We use an exogenous change in German Federal law to examine how entrepreneurial support and the ownership of patent rights influence academic entrepreneurship. In 2002, the German Federal Government enacted a major reform called Knowledge Creates Markets that set up new infrastructure to facilitate university-industry technology transfer and shifted the ownership of patent rights from university researchers to their universities. Based on a novel researcher-level panel database that includes a control group not affected by the policy change, we find no evidence that the new infrastructure resulted in an increase in start-up companies by university researchers. The shift in patent rights may have strengthened the relationship between patents on university-discovered inventions and university start-ups; however, it substantially decreased the volume of patents with the largest decrease taking place in faculty-firm patenting relationships.
Czarnitzki, Dirk, Thorsten Doherr, Katrin Hussinger, Paula Schliessler and Andrew Toole (2016), Knowledge Creates Markets: The Influence of Entrepreneurial Support and Patent Rights on Academic Entrepreneurship, ZEW Discussion Paper No. 16-036, Mannheim, published in: European Economic Review. Download