This paper conjectures that equity supply is crucial for firms in order to maintain a smooth patenting profile through time. This hypothesis is tested on Swedish firm-level observations from 1997 to 2005. Patent applications growth in Sweden has been highly volatile in recent years. During the economic downturn, following the burst of the IT-bubble, applications dropped substantially, but results here show that the downturn had little effect on the patenting of high-equity firms. Instead, the entire decline in patent applications is confined to firms with lower levels of equity. This effect is consistent across sectors, firm-size, corporate-affiliation, and human-capital intensity.
CITATION STYLE
Martinsson, G., & Lööf, H. (2013). Financial factors and patents. In Long Term Economic Development: Demand, Finance, Organization, Policy and Innovation in a Schumpeterian Perspective (pp. 395–416). Springer Berlin Heidelberg. https://doi.org/10.1007/978-3-642-35125-9_17
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