Working Papers
Working Papers
Embedded Files
Patent Quality Across Innovation Waves
"First Mover Advantages in Innovation Waves" (Job Market Paper) (Link)
Abstract: This study shows that firms innovating early in innovation waves outperform later entrants in patent quality and financial outcomes. Using a novel nonparametric spectral estimation method, I identify innovation waves at the sector level and test for first-mover advantages. Consistent with first-mover advantages, I find that patents filed immediately before a wave begins are associated with more citations and higher patent value than later filings. At the firm level, pre-wave patenting firms show increasing long-term profitability and capital expenditures. Testing the source of these advantages, I find they stem mainly from endogenous firm traits like life cycle stage and inventor talent rather than timing alone. The findings indicate that the timing of entry into innovation waves offers valuable insights into a firm's future financial performance and market value, with implications for investment strategies and competitive dynamics.
Rate of future acquisitions
Abstract: We study the causal effect of failed acquisition attempts on the likelihood of acquiring other firms. Our empirical design compares the future acquisitions of U.S. listed firms after failed and completed international attempts. Attempt failure is instrumented with post-deal-announcement short-run foreign exchange rate variation. Deals fail more often when the local currency depreciates after announcement. Firms that fail in their attempts (for this arguably exogenous reason) are less likely to complete other acquisitions, particularly domestic and downstream acquisitions. Our findings suggest that failed attempts disrupt a series of complementary acquisitions rather than merely representing independent missed opportunities.
Biases and Information amplify tax effects
"The dynamics of executive stock options: Taxes, inside information, and behavioral biases"
Abstract: After executives exercise stock options, they choose when to sell the acquired shares. If they hold the shares for at least one year, they enjoy lower capital gains and tax benefits but bear stock price risk before the one-year anniversary. In this paper, I build a model of the optimal timing of option exercise and stock sales with a rational risk-averse executive and taxes. The model predicts that risk-averse executives who expect stock prices to appreciate will exercise and hold shares for tax purposes. Extending the model to incorporate informational advantages and behavioral biases of optimism and overconfidence, I find that both information and biases are positively related to the propensity to hold shares longer. However, realized gains from biases are lower than gains from inside information. Empirical results confirm that holding shares for tax purposes is more related to biases than information advantages."The dynamics of executive stock options: Taxes, inside information, and behavioral biases"
Works in progress
Works in progress
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