I am a Ph.D. Candidate in finance at the University of Rochester, Simon Business School. My research interests include Empirical Corporate Finance, Innovation, VC/PE, Entrepreneurship, and Artificial Intelligence.
Phone: +1 (617) 686 1618
Email: Tianyang.Zheng@simon.rochester.edu
Address: 4-343 Carol G. Simon Hall, University of Rochester, Rochester, NY 14627
Abstract: This paper examines the effect of mandatory pre-grant patent publications on the innovation of venture capital (VC)-backed companies. Using the American Inventors Protection Act (AIPA) as a shock that mandated an 18-month pre-grant publication, I find relative improvements in innovation outputs for companies whose pre-AIPA patent applications received more "revise and resubmit" decisions (rejections). Specifically, I interpret the pre-AIPA rejections as a proxy for companies' inability to detect overlapping inventions, or in other words, uncertainty in the scope of protection companies could obtain from patents. My findings thus suggest that pre-grant patent publications generate larger benefits when they can more effectively reduce such uncertainty.
