Capturing Economic Value from Innovation Investments Archives

The Corporate Parenting Effect, Revisited

This paper investigates the cor-porate parenting advantage, the extent to which corporate parents improve the performance of theirsubsidiaries. …Read More

Understanding the Relationship between Divestitures and Innovation

Few studies have examined the impact of divestitures on the innovation performance of firms. In particular, little attention has been paid into how the divestiture of firms’ non-core businesses could influence the innovation outcomes of their core businesses. …Read More

Model Homes: Evaluating Approaches to Patient-centered Medical Home Implementation

The PCMH model has significant impact on patterns of health care utilization, especially when heterogeneity in implementation is accounted for in program evaluation.…Read More

Commuting and Innovation: Are Closer Inventors More Productive?

Commuting is costly for employees, but is it costly for employers in terms of lost productivity? We study the causal effects of commuting distance on inventor productivity. Specifically, we estimate how inventor productivity changes when their employer relocates.…Read More

A Theory of Experimentation in New Ventures

Experimentation has been the center of a fascinating debate among entrepreneurship practitioners throughout the past decade. While intellectually stimulating and practically relevant, this discussion has received little attention from management research, and therefore has no scientific support. …Read More

Experimentation and Appropriability in Early-Stage Ventures: Evidence from the U.S. Software Industry

This study examines the tension between learning and appropriability in the experimentation process of early-stage ventures. I build a stylized model to argue that, when formal intellectual property is weak, the learning benefit of experimentation may be offset by its imitation risk. …Read More

Inventor Commingling and Innovation in Technology Startup Mergers & Acquisitions

David Hsu, Management, The Wharton School, Qingqing Chen, PhD Candidate in Business Economics, The Wharton School, and David Zvilichovsky, Coller School of Management, Tel Aviv University Abstract: How does inventor team “commingling” (containing inventors from the acquiring and acquired firms) in technology startup acquisitions relate to innovation outcomes? Commingling reflects…Read More

Internal agglomeration and productivity: Evidence from microdata

Evan Rawley, Associate Professor of Management, University of Connecticut, and Robert Seamans, Stern School of Business, NYU Abstract: We study how internal agglomeration—geographic clustering of business establishments owned by the same parent company—influences establishment productivity. Using Census microdata on the population of U.S. hotels from 1987-2007, we find that doubling the…Read More

Competition, Profitability, and Discount Rates

We develop a general-equilibrium asset-pricing model with dynamic games of price competition. Price war risks arise endogenously from declines in long-run growth as firms’ incentive to undercut prices grows stronger with a worse growth outlook. …Read More

The Role of Competitive Amplification in Explaining Sustained Performance Heterogeneity

This paper presents a formal model that elucidates how sustained performance heterogeneity emerges from competitive amplification due to endogenous resource investment under uncertainty. Specifically, the model shows that if resources are scale free, any small resource differences are amplified into large performance differences. …Read More

Borrow and Buy: Complementarity and Substitutability of Acquirer’s Alliances and Technology Acquisitions

I aim to contribute to corporate strategy and technology and innovation management literatures by refining the way we think about how firms’ externally accessible resources and capabilities influence those firms’ heterogeneous boundary choices and their resulting outcomes. …Read More

Does Unlimited Vacation Benefit Firms? An Examination of How and When

This paper addresses the recent trend of offering unlimited vacation to employees. While potentially useful for acquiring human capital benefits, unlimited vacation is a risky perk for firms due to the possibility of abuse.…Read More

Benchmarking U.S. University Patent Value and Commercialization Efforts: A New Approach

University research-originated patented inventions are both becoming more numerous over time, and of higher “quality” as measured by standard social science metrics. Despite the significance of patented university research, it is difficult to observe the extent to which universities are able to capture the economic value from their patented inventions. …Read More

Feedback and Contagion through Distressed Competition

Firms tend to compete on prices more aggressively when they are in financial distress; the intensified competition in turn reduces firms’ profit margins, pushing them further into distress. Competitors’ aggressive pricing reactions could be attributed to both predatory and self-defensive incentives.…Read More

Organizational Change and the Dynamics of Innovation: Formal R&D Structure and Intrafirm Inventor Networks

Prior research has argued and shown that firms with centralized R&D produce broader innovations relative to decentralized firms, but the organizational mechanisms underlying this relationship are underexplored. This gap limits our understanding of whether and how formal R&D structure can be used as a lever to influence research outcomes.…Read More

Does Crowdfunding Benefit Entrepreneurs and Venture Capital Investors?

We study how a new development in entrepreneurship—crowdfunding—interacts with more traditional financing sources, such as venture capital (VC) and bank financing. …Read More

Data Analytics, Innovation, and Firm Productivity

This study focuses on how data analytics talent in firms can have an effect on firms’ return on their technology investment. Especially with the rise of social media, cloud computing, as well as many other technologies that can capture detailed digital trace about various human interactions, we hope to understand how some firms can capture the value of the data and gain competitive advantage while some could not.…Read More

Algorithmic Literacy in the Labor Market

Using data on employer job search, this study demonstrates that employers are seeking algorithmic literacy from workers in a particularly broad class of occupations because familiarity with algorithms in downstream “using” occupations is important for integrating AI and data science into production. …Read More

Economics of Leveraged Buyouts: Theory and Evidence from the UK Private Equity Industry

Empirical analysis of a sample of companies with private equity (PE) ownership in the UK shows that PE firms act as deep-pocket investors for their portfolio companies, rescuing them if they fall in financial distress.…Read More

Initial Coin Offerings, Speculators, and Asset Tokenization

Initial coin offerings (ICOs) are an emerging form of fundraising for blockchain-based startups. We examine how ICOs can be leveraged in the context of asset tokenization, whereby firms issue tokens backed by future assets (i.e., inventory) to finance growth.…Read More