To promote university patent transfer (UPT) and technology diffusion, the Chinese government has implemented a series of economic incentives. One such incentive involves increasing the share rate of faculty inventors from 20% to 50%. We investigate whether such sharing arrangements are effective in encouraging patent disclosure by faculty inventors and in ultimately enhancing UPT performance. To conduct our empirical analysis, we selected the top 35 universities in China based on their rankings in terms of patent applications and collected comprehensive data pertaining to their patent applications and faculty inventors. A regression model based on propensity score matching was developed to obtain the results. The results demonstrate that the economic incentives of increased inventor share rates only partly achieved the policy goals. Specifically, increasing the inventor's share of equity exhibits positive influences on faculty invention disclosure rates at both the faculty and patent levels but a negative impact at the university level. It also leads to an improvement in university UPT performance. In contrast, increasing the inventor's share of royalty fails to produce the desired effect. It does not significantly contribute to promoting invention disclosure or UPT performance. From these results, this study provides better ways for Chinese university administrators and policymakers to improve the future of invention disclosures and UPT.