Does Access to Patent Information Help Technological Acquisitions? Evidence From Patent Library Openings

58 Pages Posted: 29 Jul 2022 Last revised: 13 Feb 2024

See all articles by Connie X. Mao

Connie X. Mao

Temple University - Fox School of Business and Management

Yueru Qin

Temple University - Department of Finance

Xuan Tian

Tsinghua University - PBC School of Finance

Chi Zhang

University of Massachusetts Lowell

Date Written: December 28, 2021

Abstract

Technology acquirers face significant information asymmetry when identifying appropriate acquisition targets. Exploiting plausibly exogenous variation in technological information gathering costs caused by staggered openings of patent libraries, we find firms become more active in technological acquisitions following local patent library openings. In addition, acquirers prefer targets that are geographically or technologically close to a less extent, technology M&A completion rates increase and performance improves, and post-merger innovation output enhances through more collaboration between acquirers’ and targets’ inventors. Overall, our study sheds new light on the importance of information gathering costs in corporate takeovers and the search for human capital synergies.

Keywords: Mergers and Acquisitions; Patent and Trademark Depository Library; Patent Information; Information Gathering Costs

JEL Classification: G34, O3, O34, O38

Suggested Citation

Mao, Connie X. and Qin, Yueru and Tian, Xuan and Zhang, Chi, Does Access to Patent Information Help Technological Acquisitions? Evidence From Patent Library Openings (December 28, 2021). PBCSF-NIFR Research Paper Forthcoming, Fox School of Business Research Paper Forthcoming, Available at SSRN: https://ssrn.com/abstract=3995489 or http://dx.doi.org/10.2139/ssrn.3995489

Connie X. Mao

Temple University - Fox School of Business and Management ( email )

416 Alter Hall
Philadelphia, PA 19122
United States
215-204-4895 (Phone)
215-204-1697 (Fax)

Yueru Qin

Temple University - Department of Finance ( email )

Fox School of Business and Management
Philadelphia, PA 19122
United States

Xuan Tian

Tsinghua University - PBC School of Finance ( email )

No. 43, Chengfu Road
Haidian District
Beijing 100083
China
+86-10-62794103 (Phone)

HOME PAGE: http://xuantian.info/

Chi Zhang (Contact Author)

University of Massachusetts Lowell ( email )

Pulichino Tong Building
Manning School of Business
Lowell, MA 01854
United States

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