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Trade secrets protection and employment of public firms: Evidence from the Uniform Trade Secrets Act

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  • Liu, Andrew Yizhou

Abstract

I demonstrate that the adoption of the Uniform Trade Secrets Act (UTSA) results in a 5.1% increase in employment among public firms in Compustat. The effects are concentrated in firms with below-median initial employment, higher debt costs, and greater potential for knowledge spillovers. R&D expenditures and the accumulation of intangible assets emerge as key drivers of these employment effects. An analysis of labor demand reveals a 9.4% rise in vacancy postings, particularly for skilled workers, following UTSA adoption. Counties with higher initial exposure to public firms’ labor demand experience declines in unemployment rates, underscoring the UTSA’s non-uniform impact on local labor markets and employment growth.

Suggested Citation

  • Liu, Andrew Yizhou, 2025. "Trade secrets protection and employment of public firms: Evidence from the Uniform Trade Secrets Act," Research Policy, Elsevier, vol. 54(6).
    • Handle: RePEc:eee:respol:v:54:y:2025:i:6:s0048733325000721
    DOI: 10.1016/j.respol.2025.105243
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    1. Hussinger, Katrin, 2026. "Did the defend trade secrets act spur the reliance on trade secrets?," Research Policy, Elsevier, vol. 55(5).

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    Keywords

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    JEL classification:

    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • E24 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs
    • K2 - Law and Economics - - Regulation and Business Law

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