Should I stay or should I go? Relocation and inventors' performance
SITE (Science, Innovation, Technology, and Entrepreneurship)
We study how the inventors’ response to exogenous policy changes that limit their mobility in the local job market affects the inventors’ innovation performance. To obtain exogenous variation in the inventors’ mobility limitations, we examine the U.S. state-level legal adoption of the inevitable disclosure doctrine (IDD), which reduces the local inter-firm mobility of inventors who would inevitably disclose trade secrets. Using a difference-in-differences methodology we focus on the impact of a shifting regime on the inventor-level innovation performance. Our preliminary findings show that, following the adoption of the IDD at the state level, inventors who move to a different location within the same company increase the overall quality and narrow the technological scope of their innovation outcomes, thus becoming more specialized inventors. These results have important implications for companies that may aim at adopting alternative strategies to 1) prevent knowledge leakages due to the job-hopping of key employees and 2) incentivize them to make technology- and firm-specific human capital investments.