Exploratory Report: Annual Business Survey Ownership Diversity and Its Association with Patenting and Venture Capital Success
October 2024
Working Paper Number:
CES-24-62
Abstract
The Annual Business Survey (ABS) as the replacement for the Survey of Business Owners (SBO) serves as the principal data source for investigating business ownership of minorities, women, and immigrants. As a combination of SBO, the innovation questions formerly collected in the Business R&D and Innovation Survey (BRDIS), and an R&D module for microbusinesses with fewer than 10 employees, ABS opens new research opportunities investigating how ownership demographics are associated with innovation. One critical issue that ABS is uniquely able to investigate is the role that diversity among ownership teams plays in facilitating innovation or intermediate innovation outcomes in R&D-performing microbusinesses. Earlier research using ABS identified both demographic and disciplinary diversity as strong correlates to new-to-market innovation. This research investigates the extent to which the various forms of diversity also impact tangible innovation related intermediate outcomes such as the awarding of patents or securing venture capital financing for R&D. The other major difference with the earlier work is the focus on R&D-performing microbusinesses that are an essential input to radical innovation through the division of innovative labor. Evidence that disciplinary and/or demographic diversity affect the likelihood of receiving a patent or securing venture capital financing by small, high-tech start-ups may have implications for higher education, affirmative action, and immigration policy.
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ownership,
acquisition,
venture,
minority,
investor,
acquirer,
innovation,
patent,
innovate,
patenting,
developed,
opportunity,
founder,
diversify,
innovative,
innovation patenting
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National Science Foundation,
Department of Energy,
Economic Census,
North American Industry Classification System,
Census Bureau Disclosure Review Board,
Survey of Business Owners,
Disclosure Review Board,
Business R&D and Innovation Survey,
Federal Statistical Research Data Center,
National Center for Science and Engineering Statistics,
Annual Business Survey,
J16
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