Publications
Publications
- Forthcoming
- Review of Financial Studies
The Use and Misuse of Patent Data: Issues for Finance and Beyond
By: Josh Lerner and Amit Seru
Abstract
Patents and citations are powerful tools for understanding innovation increasingly used in financial economics (and management research more broadly). Biases may result, however, from the interactions between the truncation of patents and citations and the changing composition of inventors. When aggregated at the firm level, these patent and citation biases can survive popular adjustment methods and are correlated with firm characteristics. These issues can lead to problematic inferences. We provide an actionable checklist to avoid biased inferences and also suggest machine learning as a potential new way to address these problems.
Keywords
Citation
Lerner, Josh, and Amit Seru. "The Use and Misuse of Patent Data: Issues for Finance and Beyond." Review of Financial Studies (forthcoming).