The New New Financial Thing: The Sources of Innovation Before and After State Street

Josh Lerner

No 10223, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: This paper examines the sources of financial innovations between 1990 and 2002, using Wall Street Journal articles as indicators of innovations. No evidence suggests that larger firms are particularly innovative; in many specifications, there is a disproportionate representation of smaller firms among the innovators. Less profitable firms and those with stronger academic ties also innovate more. The elasticity of innovation with respect to size appears to have increased sharply since the State Street decision that greatly accelerated the rate of financial patenting. I conclude by exploring how the origins of financial patents resemble or differ from those of innovations.

JEL-codes: G2 O3 (search for similar items in EconPapers)
Date: 2004-01
New Economics Papers: this item is included in nep-cfn, nep-ent and nep-tid
Note: CF PR
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Citations: View citations in EconPapers (5)

Published as Lerner, Josh. "The New New Financial Thing: The Original Of Financial Innovations," Journal of Financial Economics, 2006, v79(2,Feb), 223-255.

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