NBER Working Papers and Publications by Noah Stoffman

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Working Papers and Chapters and Reporter Articles

January 2013Winners and Losers: Creative Destruction and the Stock Market
with Leonid Kogan, Dimitris Papanikolaou: w18671
We develop a general equilibrium model of asset prices in which the benefits of technological innovation are distributed asymmetrically. Financial market participants do not capture all the economic rents resulting from innovative activity, even when they own shares in innovating firms. Economic gains from innovation accrue partly to the innovators, who cannot sell claims on the rents that their future ideas will generate. We show how the unequal distribution of gains from innovation can give rise to a high risk premium on the aggregate stock market, return comovement and average return differences among growth and value firms, and the failure of traditional representative-agent asset pricing models to account for cross-sectional differences in risk premia.
January 2012Technological Innovation, Resource Allocation, and Growth
with Leonid Kogan, Dimitris Papanikolaou, Amit Seru: w17769
We propose a new measure of the economic importance of each innovation. Our measure uses newly collected data on patents issued to US firms in the 1926 to 2010 period, combined with the stock market response to news about patents. Our patent- level estimates of private economic value are positively related to the scientific value of these patents, as measured by the number of citations that the patent receives in the future. Our new measure is associated with substantial growth, reallocation and creative destruction, consistent with the predictions of Schumpeterian growth models. Aggregating our measure suggests that technological innovation accounts for significant medium-run fluctuations in aggregate economic growth and TFP. Our measure contains additional information relative to citatio...

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