| Abstract: |
This paper provides new causal evidence on how patent allowances affect firms
and their employees based on quasi-random assignment of patent applications to
examiners. Exploiting employer–employee records with newly linked German firm
data and web-scraped patent documents, we show that patent-induced shocks
reduce firm exit, improve productivity, and increase wages, with rent-sharing
elasticities between 0.10 and 0.21. Wage gains are broadly observed across
occupational tasks, with high heterogeneity: managers benefit
disproportionately in publicly traded firms, whereas broader wage increases
accrue to workers in non-traded firms. Our findings highlight the role of
institutional features and firm organization in shaping how rents are shared. |