How Geopolitics Is Changing the Economics of Innovation

Entrepreneurship and Innovation Policy and the Economy · 2026-03-01 · 1 citations

This paper argues that the significant geopolitical shifts of the past decade require a new approach to studying the economics of innovation. We document that national governments increasingly seek to control critical technologies rather than encouraging diffusion globally. This dynamic is reshaping the pathways and production of innovation around the world—highlighting priorities for both innovation ecosystems and the industrial base. Furthermore, at each stage of the innovation process, the focus on control of innovation is shaping considerations for the geographic distribution of participation. To enable greater control, nations are creating new institutions to shape the innovation ecosystem, guided by the logic of economic security as opposed to the traditional metrics of efficiency and cost. We demonstrate the impact of this shift on the development of three technologies: quantum computers, advanced semiconductors, and fusion energy systems. We provide several implications for economists studying innovation as they develop new research questions and seek to explain the rate and direction of innovation in this new paradigm.

Opinion Trumps Fact: Entrepreneurship and Competition in Political News

SSRN Electronic Journal · 2025-01-01

Firm Boundaries and Supply Chain Resilience: Evidence from the COVID-19 Pandemic

SSRN Electronic Journal · 2025-01-01

Emergence and Growth Strategy of Entrepreneurial Firms: Evidence Based on Large-Scale Data

Academy of Management Proceedings · 2024-07-09

Entrepreneurial firms have long been hailed as the force that stimulates innovations, employment, and economic growth writ large. For these reasons, organization and entrepreneurship scholars have long been interested in the growth of technology firms. Considerable research over the past two decades has drawn scholarly attention to issues relating to how entrepreneurial firms emerge and grow their capabilities through specific organizational structure and processes, which have been found to exert enduring influences on subsequent organizational development. More recently, an emerging body of research has sought to understand the growth and strategy of young firms’ organizational capabilities by examining their human capital growth as well as their strategic moves. In recent years, novel, large-scale, longitudinal datasets have emerged that enabled researchers to adequately track firms’ historical growth trajectories beyond what small hand-collected samples of entrepreneurial firms can reveal. This symposium intends to gather a group of papers that have leveraged such novel, large-scale data to address unanswered questions in the literature regarding the founding patterns of entrepreneurial firms as well as growth strategies adopted by entrepreneurial firms. The Composition and Dynamics of Technology-Enabled Entrepreneurship Author: Innessa Colaiacovo; - Author: Daniel Gross; Fuqua School of Business, Duke U. Author: Jorge Guzman; Columbia Business School Opinion is Cheaper than Facts: How New Entrants Have Shaped the Business of Political News Author: Aaron Chatterji; Duke U. Author: Sharique Hasan; Fuqua School of Business, Duke U. Author: Dror Shvadron; - The Effect of Commercial, Regulatory, and Sociocultural Pressures on Hiring Strategies post-IPO Author: Beril Yalcinkaya; U. of Maryland R.H. Smith School of Business Author: Waverly W. Ding; U. of Maryland Author: Anil K Gupta; U. of Maryland College Park Startup Hiring through Firm-Driven Search: Evidence from Venture for America Author: Michael Pergler; The Wharton School, U. of Pennsylvania

No Free Lunch? Welfare Analysis of Firms Selling Through Expert Intermediaries

The Review of Economic Studies · 2024-09-09 · 19 citations

Abstract We study how firms target and influence expert intermediaries. In our context, pharmaceutical manufacturers provide payments to physicians during promotional interactions. We develop an identification strategy based on plausibly exogenous variation in payments driven by differential exposure to spillovers from AMC CoI policies. Using a case study of an important class of cardiovascular drugs, we estimate heterogeneous effects of payments on prescribing, with firms targeting highly responsive physicians. We also develop a model of supply and demand, which allows us to quantify how oligopoly prices reduce drug prescribing, and how payments move prescribing closer to the optimal level, but at great financial cost. In our estimated model, whether consumers are harmed by payments depends on whether there is substantial under-prescribing due to behavioural or other frictions. In a final exercise, we calibrate such frictions using clinical data and estimate that payments benefit consumers in this case study.

Taste Before Production: The Role of Judgment in Entrepreneurial Idea Generation

SSRN Electronic Journal · 2023-01-01 · 1 citations

Experimentation and Start-up Performance: Evidence from A/B Testing

Management Science · 2022-01-13

Recent scholarship argues that experimentation should be the organizing principle for entrepreneurial strategy. Experimentation leads to organizational learning, which drives improvements in firm performance. We investigate this proposition by exploiting the time-varying adoption of A/B testing technology, which has drastically reduced the cost of testing business ideas. Our results provide the first evidence on how digital experimentation affects a large sample of high-technology start-ups using data that tracks their growth, technology use, and products. We find that, although relatively few firms adopt A/B testing, among those that do, performance improves by 30%–100% after a year of use. We then argue that this substantial effect and relatively low adoption rate arises because start-ups do not only test one-off incremental changes, but also use A/B testing as part of a broader strategy of experimentation. Qualitative insights and additional quantitative analyses show that experimentation improves organizational learning, which helps start-ups develop more new products, identify and scale promising ideas, and fail faster when they receive negative signals. These findings inform the literatures on entrepreneurial strategy, organizational learning, and data-driven decision making. This paper was accepted by Toby Stuart, entrepreneurship and innovation.

The Role of Innovation and Entrepreneurship in Economic Growth

2022 · 54 citations

• Economic geography
• Business
• Economic system

Introduction: Beyond 140 Characters

NBER Chapters · 2021-01-01

When Does Entrepreneurial Failure Help the Next Tech-Based Start-Up?

Academy of Management Proceedings · 2021-07-26 · 1 citations

How entrepreneurs respond to previous start-up failure has important implications for subsequent start-up performance. As part of the research about entrepreneurial failure experience, prior researchers have examined the antecedents of learning from entrepreneurial failure. We extend the literature by focusing on changes in business model and technology after a previous start-up failure, which are crucial antecedents to understand learning mechanisms from entrepreneurial failure. To understand whether a failed entrepreneur who changed a business model or technology shows a performance advantage in a subsequent start-up or not, we build our hypotheses based on a behavior theory of firms. Using data on early-stage technology-based firms, we find several notable results. First, start-ups that change their internal business aspects (business model or technology) after previous start-up failures perform better than other start-ups that do not change their business model after previous start-up failure. Second, start-ups that change internal business aspects (business model or technology) after previous start-up failure show higher performance than other start-ups that change internal business aspects (business model or technology) after previous start-up success. Thus, the results have important implications for the study of learning antecedents from entrepreneurial failure experience.