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Dynamics of First-Time Patenting Firms

Author

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  • Nilsen, Øivind Anti

    (Norwegian School of Economics)

  • Raknerud, Arvid

    (Statistics Norway)

Abstract

This paper investigates firm dynamics in the period before, during, and after an event consisting of a first published patent application. The analysis is based on patent data from the Norwegian Industrial Property Office merged with data from several business registers covering a period of almost 20 years. We apply an event study design and use matching to control for confounding factors. The first patent application by a young firm is associated with significant growth in employment, output, assets and public research funding. Moreover, our results indicate that economic activity starts to increase at least three years ahead of the first patent application. However, we find no evidence of additional firm growth after patent approval for successful applicants. Our findings indicate that the existence of a properly functioning patenting system supports innovation activities, especially early in the life cycle of firms.

Suggested Citation

  • Nilsen, Øivind Anti & Raknerud, Arvid, 2022. "Dynamics of First-Time Patenting Firms," IZA Discussion Papers 15529, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp15529
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    More about this item

    Keywords

    patenting; firm performance; panel data; event study design;
    All these keywords.

    JEL classification:

    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • O34 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital

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