Corporate taxation and the choice of patent location within multinational firms

► Patents are mobile and valuable assets within multinational entities (MNEs). ► MNEs thus have an incentive to distort their location towards low-tax affiliates. ► We test for this using firm panel data augmented by data on patent applications. ► The results suggest that high taxes deter the number of patent applications. ► The effect is quantitatively large and prevails in various robustness checks.