A new study by a Sloan researcher suggests that the recent increase of so-called “patent trolls”—companies that do little more than sue others over patent rights—has resulted in a huge loss of entrepreneurial activity in the United States. The study, by marketing professor Catherine Tucker, correlates patent litigation and venture capital (VC) investment using data from 1995 to 2012. The “evidence suggests that more lawsuits can distract management from developing new and innovative products, and may cause them to ignore products targeted by lawsuits, in addition to the more obvious litigation costs,” she writes. The paper says that VC investment would have been more than $21 billion higher over five years if not for lawsuits brought over patents by frequent litigators.

Explore Professor Tucker’s research in the Open Access Articles collection in DSpace@MIT, where it is openly accessible to the world.

Since the MIT faculty established their Open Access Policy in March 2009 they have made thousands of research papers freely available to the world via DSpace@MIT. To highlight that research, we’re offering a series of blog posts that link news stories about scholars’ work to their open access papers in DSpace.