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  5. M&A and Innovation: A New Classification of Patents

M&A and Innovation: A New Classification of Patents

  • Zhaoqi Cheng
  • Ginger Zhe Jin
  • Mario Leccese
  • Dokyun Lee
  • Liad Wagman
AEA Papers and Proceedings
vol. 113, May 2023
(pp. 288-93)
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Abstract

Policymakers are increasingly concerned that incumbent acquisitions of small or young firms may slow down rather than speed up innovation, but it is difficult to identify which firms are related in the fast-changing space of technological innovation. This paper proposes a new, data-driven method to classify patent data into tech-business zones on a probabilistic basis, using patent assignee information. After combining mergers and acquisitions data from S&P Global Market Intelligence with PatentsView data from the US Patent and Trademark Office, we discuss how the zone classification can aid merger reviews and other lines of research.

Citation

Cheng, Zhaoqi, Ginger Zhe Jin, Mario Leccese, Dokyun Lee, and Liad Wagman. 2023. "M&A and Innovation: A New Classification of Patents." AEA Papers and Proceedings, 113: 288-93. DOI: 10.1257/pandp.20231100

Additional Materials

JEL Classification

  • D22 Firm Behavior: Empirical Analysis
  • G34 Mergers; Acquisitions; Restructuring; Voting; Proxy Contests; Corporate Governance
  • G38 Corporate Finance and Governance: Government Policy and Regulation
  • K21 Antitrust Law
  • L41 Monopolization; Horizontal Anticompetitive Practices
  • O31 Innovation and Invention: Processes and Incentives
  • O34 Intellectual Property and Intellectual Capital