Social and Behavioral Sciences Commons^™

Non-Competition Agreements And Research Productivity In The Biotechnology Industry, Porcher L. Taylor Iii, Joseph E. Coombs

School of Professional and Continuing Studies Faculty Publications

This paper examines the impact of the state-level legal structure, namely the legal support for non-competition agreements, on research productivity. Specifically, we study how California’s unique lack of non-competition agreement laws influences product develop when controlling for local munificence and firm-level technological capability. Our results indicate that California’s unique legal structure is negatively associated with research productivity as measured by the number of products in development at the time a biotechnology firm goes public. Further, firm size moderates this relationship such that the effect is stronger for smaller biotechnology firms.