The Breakup of Bell and its Impact on Innovation
In 1984, the Bell System was broken up after a a seven-year legal battle. Bell was
accused of having used its position as a regulated monopolistic provider of local telephone
services to erect anticompetitive barriers to entry in the potentially competitive markets for
telecommunications equipment and for long-distance telephone services. In this paper, we
show that this breakup had a substantial positive long-term impact on US innovation. By
distinguishing different technology fields, we demonstrate that the structural separation of
the Baby Bells stimulated innovation over and above what previous regulatory interventions
aiming at fostering competition in the equipment and the long-distance market had achieved.
Projektstatus |
laufend |
Projektzeitraum |
seit 01.02.2021 |
Schlüsselwörter |
Innovation; Antitrust; Structural remedies |
Standing on the shoulders of science
The goal of science is to advance knowledge, yet little is known about its value for
marketplace inventions. Analyzing U.S. patents, we establish three new facts about the
relationship between science and the value of inventions. First, we show that a patent
directly building on science is on average 2.9 million U.S. dollars more valuable than a
patent in the same technology but unrelated to science. Based on the analysis of the patent
text, we show second that the novelty of patents predicts their value, and third that scienceintensive
patents are more novel. This documents that science introduces new concepts that
are valuable for marketplace inventions. Our study informs the debate on the merits of
science for corporate innovation and the origins of breakthrough inventions.
Projektstatus |
laufend |
Projektzeitraum |
seit 01.02.2021 |
Schlüsselwörter |
Corporate Innovation; Science |