Private Equity and the Innovation Strategies of Entrepreneurial Firms: Empirical Evidence from the Small Business Innovation Research Program

Albert Link, Christopher Ruhm and Donald Siegel

No 18297, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: There is great interest in evaluating the impact of private equity investments on innovation and economic growth. However, there is no direct empirical evidence on the effects of such transactions on the innovation strategies of entrepreneurial firms. We fill this gap by examining a rich project-level data set consisting of entrepreneurial firms receiving Small Business Innovation Research (SBIR) program research awards. We find that SBIR firms attracting private equity investments are significantly more likely to license and sell their technology rights and engage in collaborative research and development agreements. Our results suggest that private equity investments accelerate the development and commercialization of research-based technologies, thus contributing to economic growth. We conclude that both public investments and private investments are key to innovation performance.

JEL-codes: G24 G34 L26 O31 O33 O38 (search for similar items in EconPapers)
Date: 2012-08
New Economics Papers: this item is included in nep-ino
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Citations: View citations in EconPapers (3)

Published as Peter Klein & Donald Siegel & Nick Wilson & Mike Wright & Albert N. Link & Christopher J. Ruhm & Donald S. Siegel, 2014. "Private Equity and the Innovation Strategies of Entrepreneurial Firms: Empirical Evidence from the Small Business Innovation Research Program," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 35(2), pages 103-113, 03.

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Journal Article: Private Equity and the Innovation Strategies of Entrepreneurial Firms: Empirical Evidence from the Small Business Innovation Research Program (2014)
Working Paper: Private Equity and the Innovation Strategies of Entrepreneurial Firms: Empirical Evidence from the Small Business Innovation Research Program (2012)
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