Working Papers



Most Recent

Upstream, Downstream: Diffusion and Impact of the Universal Product Code (with Emek Basker)

This paper matches archival data from the Uniform Code Council to establishments in the Longitudinal Business Database and Economic Census to study the diffusion and impacts of the Universal Product Code (UPC). We find evidence of network effects in the diffusion process. Matched-sample difference-in-difference estimates show that employment and trademark registrations increase following UPC adoption by manufacturers or wholesalers. Industry-level imports also increase with domestic UPC adoption. Our findings suggest that barcodes, scanning, and related technologies helped stimulate variety-enhancing product innovation and encourage the growth of international retail supply chains.

Learning When to Quit: An Empirical Model of Experimentation (with Bernhard Ganglmair and Emanuele Tarantino)

We study a dynamic model of the decision to continue or abandon a research project. Researchers improve their ideas over time, and also learn whether those ideas will be adopted by the scientific community. Projects are abandoned as researchers grow more pessimistic about their chance of success. We estimate the structural parameters of this dynamic decision problem using a novel data set that contains information on both successful and abandoned projects submitted to the Internet Engineering Task Force (IETF), an organization that creates and maintains internet standards. Using the model and parameter estimates, we simulate two counterfactual policies: a cost-subsidy and a prize-based incentive scheme. For a fixed budget, subsidies have a larger impact on research output, but prizes perform better when accounting for researchers' opportunity costs.

Patent Examiner Specialization (with Cesare Righi)

We study the matching of patent applications to examiners at the U.S. Patent and Trademark Office. The distribution of technology classes is more concentrated than would occur under random matching. Using the application text, we show that specialization persists even after conditioning on observed technology classes and sub-classes. Examiner specialization is less pronounced in computers and software than in other technological fields. More specialized examiners have a lower grant rate and produce a larger narrowing of claim-scope during the examination process. These findings undermine the idea that random matching justifies instrumental variables based on examiner behaviors or characteristics.

Disclosure Rules and Declared Essential Patents (with R. Bekkers, C. Catalini, A. Martinelli and C. Righi)

Many standard setting organizations (SSOs) require participants to disclose patents that might be infringed by implementing a proposed standard, and commit to license their essential patents on terms that are at least fair, reasonable and non-discriminatory (FRAND). Data from these SSO intellectual property disclosures have been used in academic studies to provide a window into the standard setting process, and in legal proceedings to assess parties’ relative contributions to a standard. We develop a simple model of the disclosure process to illustrate the link between SSO rules and patent-holder incentives, and examine some of the model’s predictions using a novel dataset constructed from the disclosure archives of thirteen major SSOs. The central message of the paper is that subtle differences in the rules used by different SSOs can influence which patents are disclosed, the terms of licensing commitments, and ultimately long-run citation and litigation rates for the underlying patents.

Differentiation Strategies in the Adoption of Environmental Standards: LEED from 2000-2014 (with Marc Rysman and Yanfei Wang)

We study the role of vertical differentiation in the adoption of LEED (Leadership in Energy & Environmental Design), a multi-tier environmental building certification system. Our identification strategy relies on the timing of adoption, and shows that builders seek to differentiate from each other when choosing a certification level. We estimate a model that incorporates both differentiation incentives and correlated market-level unobservables, and find that differentiation accounts for 16.5 percent of the variation due to observed factors. Finally, we use our estimates to simulate the impact of reducing the number of LEED tiers from four to two, and find that the impact on environmental investments depends upon the location of the threshold between levels.

Tax Credits and Small Firm R&D Spending (with Ajay Agrawal and Carlos Rosell)

We use a change in Canadian tax law to examine how small private firms respond to the R&D tax credit. Our estimates imply an R&D user-cost elasticity above unity. Contract R&D expenditures are more elastic than the R&D wage bill. Firms that perform contract research or recently invested in R&D capital are more responsive to a change in the after-tax cost of R&D. We interpret the latter findings as evidence of adjustment costs.

Forking, Fragmentation and Splintering (with Jeremy Watson)

Although economic theory suggests that markets may tip towards a dominant platform or standard, there are many prominent examples of persistent incompatibility, inter-platform competition and standards proliferation. This paper examines the phenomena of forking, fragmentation and splintering in markets with network effects. We illustrate several causes of mis-coordination, as well as the tools that firms and industries use to fight it, through short cases of standardization in railroad gauges, modems, operating systems, instant messaging and Internet browsers. We conclude by discussing managerial implications and the potential welfare effects of efforts to promote inter-operability.

Who Benefits Most in Disease Management Programs? Improving Target Efficiency (with Maryaline Catillon and Paul Gertler)

Disease Management Programs aim to save cost by improving the quality of care for chronic diseases. Evidence for their effectiveness is mixed. Reducing health care spending sufficiently to cover program costs has proved particularly challenging. This study uses a difference in differences design to examine the impact of a Diabetes Dis- ease Management Program for high risk patients on preventive tests, health outcomes and cost of care. Heterogeneity is examined along the dimensions of severity (mea- sured using the proxy of poor glycemic control) and preventive testing received in the baseline year. While disease management programs tend to focus on the sickest, the impact of this program concentrates in the group of people who had not received recom- mended tests in the pre-intervention period. If confirmed, such findings are practically important to improve cost effectiveness in disease management programs by targeting relevant subgroups defined both based on severity and on (missing) test information.


Older Projects

Disease Management: Helping Patients (Who Don’t) Help Themselves (with Paul Gertler)

Chronically ill patients currently consume a significant share of the U.S. health system's resources and are a rapidly growing segment of the overall population. Disease Management (DM) programs identify high-risk patients among the chronically ill, encourage them to take better care of themselves, and help coordinate the care they receive from various providers. This paper examines the impact of a diabetes Disease Management program. We find that it led to increased compliance with clinical practice guidelines, improvements in patient health, and significant reductions in the total cost of care. The financial benefits are greater for patients lacking “self control” prior to enrolment, as indicated by their failure to comply with generally accepted clinical practice guidelines. These results are especially important for the Medicare program, which has the majority of the chronically ill as beneficiaries.


Alternative Versions and Other Writing

Can standard setting organizations address patent hold­up? Comments for the Federal Trade Commission

This essay describes the problem of patent hold-up that can arise when firms own patents that are essential to an industry stadnard and fail to negotiate an ex ante license with implementers. I discusses a number of steps that standards setting organizations and government regulators might take to alleviate this problem.

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