Current Projects

Current Research Projects


Gill, Andrej and David Heller. "Leveraging the (Un)Known: The Value of Patent Portfolios", R&R Journal of Banking and Finance

We provide new evidence on the relevance of patents for attracting external debt financing. For a representative, multi-country sample, we  find large positive effects of valuable patent portfolios on firms' debt capacity. To study this, we develop a novel patent portfolio value measure using granular information on patent fee payments. For identification, we investigate exogenous variation in patent strength arising from the staggered implementation of the 2004 EU Enforcement Directive. Results are strongest for financially constrained firms, which emphasizes the strategic potential of patents. Moreover, our  findings highlight the importance of a harmonized, reliable legal framework to spur these effects.

Gill, Andrej, Hett, Florian and Johannes Tischer. "Time-Inconsistency and Households' Financial Mistakes: Evidence from Bank Transaction and Behavioral Measurement Data", R&R Journal of Finance

Households regularly fail to make optimal financial decisions. But what are the underlying reasons for this? Using two conceptually distinct measures of individual time inconsistency, one based on bank account transaction data and one based on behavioral measurement experiments, we show that the excessive use of bank account overdrafts is linked to time inconsistency. By contrast, there is no correlation between a survey-based measure of financial literacy and overdraft usage. Our results indicate that consumer education and information may not substantially improve households' financial decision-making. Rather, behaviorally motivated interventions targeting specific biases in decision-making might qualify as effective policy tools.

Eufinger, Christian, Gill, Andrej and Florian Hett. "Central Bank Policy and Firm Behavior: Evidence from the Swiss Franc Shock", 2nd round R&R Journal of International Business Studies

How does central bank policy affect international firm activity? We analyze the Swiss Franc shock of 2015, where the Swiss National Bank (SNB) removed the EUR/CHF exchange rate floor and simultaneously reduced interest rates to negative levels. We show that the interest rate cut led to a higher investment rate and employment growth, giving Swiss firms an advantage vis-à-vis European firms: Swiss firms' net investment rate is between 8.4pp and 9.7pp higher and their employment growth is between 6.7pp and 9.8pp larger post-shock than those of comparable European firms. This stimulating effect of the interest rate cut mitigated the negative impact of the Swiss Franc shock for exporters.

Gill, Andrej, Heller, David and Nina Michel "Enabling or Accelerating? The Timing of Innovation and The Different Roles of Venture Capitalists", R&R Research Policy

Venture capitalists (VCs) shape the innovative activities of nascent firms, moving beyond the mere role of providing financial resources. This paper investigates the timing of patenting of young firms around their initial VC funding round to elicit two pivotal roles of how VCs affect their targets' innovative activities. To do so, we differentiate among firms with and without patenting activities prior to the initial funding round, allowing us to distinguish enabling and accelerating effects of VCs on firms' patenting activities. As we show, differences in the timing of patent filings are critical for eliciting these different roles. We find a positive enabling effect of VCs on the quantity and quality of patenting, unfolding directly after the VC steps in. This immediate effect suggests that VCs push their targets for rapid commercialization. Further, our results show no additional (i.e., accelerating) effect of the average VC on targets that already own patents before their first VC round. However, highly involved and experienced investors trigger such effects. We deploy a variety of estimations techniques on a matched sample of startups, and assess selection effects. To establish these results, we explore novel data that combines European firm-, patent-, and investment-level information on first-round targets between 1995 and 2015. The findings improve our understanding of the role of key intermediaries in startups' innovation processes.