Product market power serves as a natural hedge against adverse shocks and competitive threats, thus increasing managerial risk tolerance of innovation investment. Consistent with that, we find that product market power is positively associated with firm innovation input and output. Additionally,...

We examine how firms react to their competitors' highly publicized technology breakthroughs measured by the renowned R&D 100 Award. These awards have been granted to top 100 technological inventions every year since 1965 and have come to be known as the “Oscar of Invention” (e.g., Verhoeven,...

We estimate the value of innovative assets using the value paid for private, innovative targets. Since young, private firms are the primary drivers of mold-breaking innovation, we focus on such firms. We adopt a novel approach that uses the price paid for young, private targets together with...

We find that small innovators earn higher returns than small non-innovators for up to five years. We find no such innovation premium among large firms. A battery of tests shows that this innovation premium among small firms is explained by risk. Our findings, which are based on a simple measure...

Prior research finds that investors have difficulty pricing corporate innovation. This paper investigates the role of long-term growth forecasting financial analysts in the efficiency of stock prices and consensus sell-side analyst forecasts, with respect to information about firms' innovative...

Does the stock price efficiency, i.e. the speed and the extent with which prices reflect public information, affect corporate innovation? Using the intensity of algorithmic trading (AT) to capture price efficiency and the Tick Size Pilot experiment setting, we establish a causal positive...

Using the staggered implementation of the EDGAR system from 1993 to 1996 as a shock to information dissemination technologies, we examine the potential benefits and costs of modern information technologies on the real economy. On the one hand, we document that broader information dissemination...

We examine how the regulation of financial reporting frequency affects corporate innovation. We use a difference-in-differences approach based on a sample of treatment firms that experience a change in their reporting frequency and matched industry peers and control firms whose reporting...