Hidden Champions (HCs) are firms unknown to the wider public, but global leaders in the niche markets they serve. This paper looks at distinctive features of these firms, focusing on their dynamic capabilities. Employing a unique data base on German firms, we identify a representative sample of...

Hidden Champions (HCs) are small- and medium-sized global market leaders that repeatedly show superior innovation capabilities and economic performance. However, empirical evidence on how the digital transformation may affect their success story remains scarce. I argue that HCs show stronger...

We investigate the causal effect of patent rights on cumulative innovation, using large-scale data that approximate the patent universe in its technological and economic variety. We introduce a novel instrumental variable for patent invalidation that exploits personnel scarcity in post-grant...

Process innovation is an important part of firms’ innovation activities and supposed to significantly contribute to positive returns from innovation. Measuring process innovation output at the firm level is still in its infancy, however. This paper reports empirical evidence on measures of...

We study the blocking effect of patents on follow-on innovation by others. We posit that follow-on innovation requires freedom to operate (FTO), which firms typically obtain through a license from the patentee holding the original innovation. Where licensing fails, follow-on innovation is...

Public procurement accounts for 15 to 20 percent of global GDP and is considered an effective innovation policy. However, the detrimental effects of non-innovative public procurement - public procurement tenders awarded solely based on their price - on firm innovations have been largely...

Functioning markets for technology are an important determinant for the type, scope and distribution of innovation activities in an economy. However, markets for technology are often underdeveloped or inefficient. Existing theory attributes such imperfections to the supply side or differences in...

This paper estimates the effect of heterogeneous university funding stemming from the German Excellence Initiative on a regional firm’s probability to innovate by using a multi-valued two-way fixed effects difference-in-differences model. The estimations show that funding an additional...

We use exogenous variation in the strength of trade secrets protection to show that a relative weakening of patents (compared to trade secrets) has a disproportionately negative effect on the disclosure of processes - inventions that are not otherwise visible to society. We develop a structural...

Skilled labor is a key input to the innovation process. A shortage in supply of skilled labor may hence impede innovation activities, resulting in lower productivity gains. While governments are concerned about these likely negative impacts, there is only limited empirical evidence whether and...