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Trade Secret Protection and R&D Investment of Family Firms

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  • Katrin Hussinger

    (Université du Luxembourg)

  • Wunnam Basit Issah

    (University of Leicester)

Abstract

Family firms are known for their reluctance to invest in research and development. We show that strengthened trade secret protection is associated with higher R&D investment by family firms. More specifically, we show that the association between the strength of trade secret protection through the U.S. Uniform Trade Secrets Act and R&D investment is positively moderated by family control. Our results further show that the positive moderation of family control on the association between the strength of trade secret protection and R&D investment varies with the industry context, being stronger in high tech industries and weaker in discrete product industries.

Suggested Citation

  • Katrin Hussinger & Wunnam Basit Issah, 2022. "Trade Secret Protection and R&D Investment of Family Firms," DEM Discussion Paper Series 22-11, Department of Economics at the University of Luxembourg.
    • Handle: RePEc:luc:wpaper:22-11
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    File URL: http://hdl.handle.net/10993/51974
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    Keywords

    Family firms; intellectual property protection; trade secret protection; UTSA; R&D investments; socioemotional wealth.;
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