Working Papers
Working Papers
We study how patent protection affects venture capital (VC) investment in startups by exploiting the Bilski v. Kappos Supreme Court decision, which unexpectedly narrowed patent eligibility. Using variation in industry exposure to the ruling, we find that more exposed industries experienced larger increases in initial VC investment after the decision. These gains are concentrated in startups with limited patent holdings, particularly in competitive and patent-intensive industries, while investments in startups with extensive patent holdings show no comparable response. Our findings suggest that weaker patent protection lowers barriers to VC-backed entry and reallocates capital toward startups previously constrained by incumbent patents.
Conventional wisdom lacks consensus on the influence of formal education on entrepreneurship. Using exogenous introduction of entrepreneurship major degrees as an empirical setting to overcome selection bias, I examine the impact of obtaining a degree in entrepreneurship on entry into and success within entrepreneurial ventures. Difference-in-differences estimates show modest but statistically significant increases in entrepreneurial entry among sophomores exposed to these programs, suggesting that entrepreneurship education can shift entry decisions at the margin. Students majoring in entrepreneurship are about 6 percentage points more likely to begin their careers as entrepreneurs compared to peers in other majors.