This paper examines the role of patent texts in the stock market valuation of patents. Utilizing the large language model BERT (Bidirectional Encoder Representations from Transformers) to summarize contextual information within patent texts, I find that patent texts explain 31.5% of the variation in the stock market valuation of patents and provide large incremental explanatory power beyond other structured patent characteristics, firm characteristics, and technological trends. Additionally, patent texts significantly predict the level, volatility, and cumulation speed of future earnings, suggesting they contain genuine information about firms' performance. However, investors do not fully incorporate such information within patent texts into stock prices, as evidenced by the predictive power of patent texts for future stock returns. This underreaction is diminished after the pre‐grant publication of patent applications is mandated. My findings underscore the value of patent texts as a source of information on internally developed intangibles and have implications for academics, practitioners, and regulators.

We show that banks use industry knowledge acquired through corporate lending in mortgage lending, a phenomenon we refer to as the “industry expertise channel.” Specifically, banks that specialize in particular industries expand their mortgage lending activity in regions where those industries are concentrated. The impact of industry expertise increases with information asymmetry and borrower risk. In addition, mortgages originated from this channel contain more soft information and perform better. The effect of the channel increases after unexpected industry distress and the 2008 financial crisis, suggesting that the effect is likely causal.

We examine the impact of technological competition on voluntary innovation disclosure around the enactment of the Leahy–Smith America Invents Act of 2011 (“AIA”). The AIA moves the US patent system from the first‐to‐invent to first‐inventor‐to‐file system and induces a patent race that increases technological competition. Firms that are slow to file a patent are disadvantaged in this race. We find that focal firms with lagging patent classes strategically increase scientific publications in their lagging technology areas in an attempt to block competitors from obtaining a patent. This effect is more pronounced in technology areas where the firm has better information about their relative competitive position (proxied by greater inventor mobility), in technology classes with constraints on increasing patent filing timeliness (proxied by fewer experienced attorneys), and areas characterized by more intense competition. We find that the peers of firms with lagging classes experience greater patent filing rejections for lack of novelty and obviousness reasons after the AIA, suggesting that strategic scientific disclosure is effective.