Emotions and Inventor Productivity: Evidence from Terrorist Attacks

We examine whether the emotional shocks associated with terrorist attacks affect local inventors’ productivity. We find that high-fatality attacks make inventors less innovative, and low-fatality attacks make them more innovative. Inventors living in high risk-taking environments have greater increase in productivity following low-fatality attacks, while less decrease in productivity following high-fatality attacks. Further, the effect of terrorist attacks on inventor productivity mainly comes from exploratory innovation which involves more risks. Inventors affected by high-fatality attacks are also more likely to move to places without any significant terrorist attack history, but there is no such effect for low-fatality attacks.

Keywords: Terrorist attacks; Emotion; Inventor productivity

JEL Classification: G39, O31

Suggested Citation: Suggested Citation

Luo, Yue and Chen, Yangyang and Lin, Ji-Chai, Emotions and Inventor Productivity: Evidence from Terrorist Attacks (September 9, 2020). Available at SSRN: https://ssrn.com/abstract=3321554 or http://dx.doi.org/10.2139/ssrn.3321554