Publications
Publications
- September 2024
- Strategic Management Journal
Standing on the Shoulders of Science
By: Joshua Lev Krieger, Monika Schnitzer and Martin Watzinger
Abstract
Today’s innovations rely on scientific discoveries of the past, yet only some corporate
R&D builds directly on scientific output. In this paper, we analyze U.S. patents to
investigate how firms generate value by building on prior art “closer” to science. We
show that patent value is decreasing in distance-to-science. Overall, we find a science
premium within firms ranging from 5.0% and 18.3%. If we allow for firm sorting
into different modes of R&D based on their relative advantage, i.e., when we do not
control for firm fixed effects, we find an even larger science premium: patents building
directly on scientific publications are 4.0%–42.3% more valuable than patents in the
same technology that are not directly based on science.
Keywords
Citation
Krieger, Joshua Lev, Monika Schnitzer, and Martin Watzinger. "Standing on the Shoulders of Science." Strategic Management Journal 45, no. 9 (September 2024): 1670–1695.