Are Inventors or Firms the Engines of Innovation?

Ajay Bhaskarabhatla (), Luis Cabral, Deepak Hegde () and Thomas Peeters
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Ajay Bhaskarabhatla: Erasmus School of Economics, Erasmus University, 3062 PA Rotterdam, Netherlands
Deepak Hegde: Stern School of Business, New York University, New York, New York 10012

Management Science, 2021, vol. 67, issue 6, 3899-3920

Abstract: In this study, we empirically assess the contributions of inventors and firms for innovation using a 37-year panel of U.S. patenting activity. We estimate that inventors’ human capital is 5–10 times more important than firm capabilities for explaining the variance in inventor output. We then examine matching between inventors and firms and find highly talented inventors are attracted to firms that (i) have weak firm-specific invention capabilities and (ii) employ other talented inventors. A theoretical model that incorporates worker preferences for inventive output rationalizes our empirical findings of negative assortative matching between inventors and firms and positive assortative matching among inventors.

Keywords: human capital; innovation; matching (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (11)

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Persistent link: https://EconPapers.repec.org/RePEc:inm:ormnsc:v:67:y:2021:i:6:p:3899-3920

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