Innovation Networks and Business-Stealing

Abstract

We use the universe of USPTO data on patents and inventors from 1976 to 2019 to look at the dynamics of coauthorship on patents and its relationship with competition. First, we find an inverted-U relationship between competition and the growth in coauthorship: the number of new collaborators on each patent is maximized at intermediate levels of competition. Next, we find that there is a surge of new coauthors at the time of invention, and then fewer than normal new coauthors after a breakthrough invention. Third, the sizes of the surge and subsequent decline in coauthorship are largest in industries with intermediate levels of competition. We also present a simple model in which researchers trade off gains from collaboration against threats of business stealing, which provides one explanation for our empirical findings.