Events

Multinational Firms and Global Innovation
Presenter: Cristina Rujan (Max Planck Institute for Innovation and Competition)
Discussant: Alexey Rusakov (LMU Munich School of Management)

Competition for Attention on Information Platforms: The Case of Local News Outlets
Presenter: Tim Meyer (LMU Munich School of Management)
Discussant: Lucia Baur (TUM)

We estimate the impact of the inflow of inventors on the formation and success of local venture-backed startups, strengthening causality with a shift-share instrument based on the historic spatial distribution of millions of inventor surnames in the 1940 U.S. Census. Arrival of inventors increases the number of venture-backed startups, but only in the same technology fields of the newly-arrived inventors — and at the expense of other fields. Inventor arrivals boost the number of successful startups — including $1B+ “unicorn” exits — while reducing bankruptcies and “fire-sale” acquisitions. The improvement is also driven by a reallocation of venture capital away from investment in low-tech startups, especially unsuccessful ones.

Contact: Marina Chugunova

On 6/7 December 2021, the Max Planck Institute for Innovation and Competition will host the 4^th Research on Innovation, Science and Entrepreneurship Workshop, an annual workshop for Ph.D. students and Junior Post-docs in Economics and Management. The workshop is held online.

The goal of the RISE4 Workshop is to stimulate an in-depth discussion of a select number of empirical research papers. It offers Ph.D. students and Junior Post-docs an opportunity to present their work and to receive feedback.

Keynote speaker of the RISE4 Workshop is Catherine Tucker (MIT & NBER).

Get the Program here.
See RISE Workshop

There is an ongoing debate around whether or not universities produce too many PhD students in light of the limited number of available permanent faculty positions. A body of literature has emerged that investigate the destinations and career preferences of PhD students, but has neglected the importance of graduates’ job satisfaction, which is vital for an employee to be productive and to contribute to society. This paper contributes to our current understanding of the job market for academics by comparing job satisfaction and motivations of PhD holders outside of academia (industry or government) to those in academia, and by comparing job satisfaction and motivations of PhD holders compared to PhD drop-outs. We rely on a unique survey of 608 PhD grant applicants at the FNR and, in line with prior research, find a strong preference for intrinsic motivations and jobs in academia. We also show that many graduates leave academia and that this does not result in lower job satisfaction. However, there are distinct job satisfaction profiles, in terms of job attributes, for different sectors. These findings are of relevance to employers and policy as they inform them on job match of graduates and on the opportunity cost of pursuing a PhD. (Joint work with Cornelia Lawson, University of Manchester)

Contact person: Rainer Widmann

Prior management research has provided extensive evidence that organizational members who identify with their organization tend to support its norms and objectives by displaying behaviors that are in-line with or beyond organizational expectations. We question whether this account of observable in-role or extra-role behaviors is complete and study organizational identification dynamics in a series of secret, unauthorized innovation projects (so-called “bootlegging” projects) within a technology-driven multinational firm. In contrast to prior research, our findings suggest that organizational identification may sometimes lead members to deliberately violate organizational norms in a struggle to support their organization. More specifically, we find that organizational identification turns out to simultaneously motivate both overt in-role and secret counter-role behaviors which, at first sight, appear to be conflicting as they both draw on the member’s scarce resources. However, our results reveal that both behaviors really complement each other and thus create an interesting, hitherto unexplored organizational paradox. We then move on to also study how a member’s organizational identification may change when performing the secret innovation project and uncover the critical role of managerial responses for successfully sustaining and strengthening organizational identification of members who are both, loyal members and loose mavericks at the same time. (joint with Philipp Bubenzer)

Contact person: Rainer Widmann

We study the participation of nascent firms in open-source communities and its implications for attracting VC funding. To do so, we exploit unique data on 160,065 US startups linking information from Crunchbase to firms' GitHub accounts. Estimating a within-startup model saturated with a host of relevant fixed effects, we show that startups accelerate their activities on the platform in the twelve months prior to raising their first financing round. The intensity of their involvement on GitHub declines in the twelve months after. Remarkably, startups intensify those activities that rely on external technology sources above and beyond the technologies they themselves control. Applying machine learning to classify GitHub projects, we find that the most prevalent among these external activities are related to software development, data analytics, and integration. Our results indicate that VCs and renowned investors are the most responsive to these activities. (Joint work with Christian Peukert, HEC Lausanne, and Maria Roche, Harvard Business School)

Contact Person: Fabian Gaessler

Policy- and law-making in the field of intellectual property (IP) is about drawing a line between excludability and non-excludability of results of creative and innovative activity. The rationales for such boundaries stem from various theories about innovation, creativity, and social well-being.  The question of where to draw a line often becomes a matter of balancing competing interests and policy objectives.

The workshop will explore the challenges of this exercise in the context of EU IP law. It will stimulate the participants to view IP law and policy as a ‘work in progress’ rather than being ‘cast in stone’ and consider how the IP framework could be improved.  

5 November 2021 – 10:00 a.m. to 12:30 p.m.

• Theoretical foundations of IP law
• Critical perspectives on IP
• IP policy levers
• IP law from a law-in-social-context perspective

In-person if possible or hybrid format

Enrollment: Maximum 25 Participants

Webpage of Daria Kim

In most OECD countries, the gross domestic spending on research and development (R&D) is substantial, on average 2.5 percent of gross domestic product. A large share of the R&D expenditures, including research in the business enterprise sector, is funded by the governments. This paper investigates empirically the dynamics between firms’ employment, output, success in obtaining public research funding, labour productivity, return on assets (ROA), and capital intensity in the periods before, during, and after filing a patent application. The analysis is based on a panel of accounting data for all Norwegian firms merged with patent application data from the Norwegian Industrial Property Office (NIPO). The final panel covers a period of 18 years (2001-2018). Since the sample includes the whole population of Norwegian firms, it allows to form both a large control- and treatment-group (firms that file at least one patent application in the period). year a patent application A patent has significant positive effects on employment, output and public research funding both in periods before, during and after it is filed. The effects are largest at the extensive margins, i.e. largest for firms without any prior patent applications. Additional patents have small or insignificant effects. We also find that there is a negative correlation between R&D support and age. The overall finding is therefore that patents are important in the early in the life-cycle of firms.

Contact Person: David Heller

Pharmaceutical firms produce patents related to existing drugs even after approval by the US Food and Drug Administration. We investigate the reasons behind this strategy and relate them to generic entry threats. Estimating difference-in-differences models saturated with fixed effects, we show the threat of generic entry via Paragraph IV challenges induces pharmaceutical firms to increase the number of patents they add to an FDA-approved drug application. This strategy is aimed at fencing the firms’ existing drugs as we find no evidence that firms generate new drugs or modifications to the existing drugs after a Paragraph IV challenge. Additionally, we provide evidence showing that the added patents are negatively related to the hazard of generic entry. Consistent with patents being a double-edged sword, which protects drugs but reveals information to competitors, we find that listing all patents at the filing of a drug application is not as effective against generic entry as adding them later on.

Contact person: Fabian Gaessler

International industry-academia collaborative research（IIACR）is a developing form of R&D for creating new knowledge and stimulating innovation. However, it is difficult to pursue because of the substantial institutional distance between industry and academia as well as the significant geographical distances between various countries. This year, we launched a research project on IIACR targeting Germany, Japan, and the United States to discover the factors behind success in IIACR. We will make presentations on the current status of IIACR, research framework, and research methods.

Contact Person: Cristina Rujan