How Valuable is Patent Protection?: Estimates by Technology Field (original) (raw)
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Estimates of the Value of Patent Rights in European Countries During the Post-1950 Period
The Economic Journal, 1986
This paper examines the distribution of the values of patent rights in the United Kingdom, France, and Germany during the post-1950 period. These values are inferred from the behavior of patentees with respect to payment of renewal fees on their patents. A simple economic model of renewal decisions is combined with data on the proportion of patents renewed at alternative ages and the renewal fee schedules to produce estimates of the distribution (and the total) value of patent rights in these countries. Moreover, the data indicate that there have been changes in the value distribution, and we follow these changes over the period. The empirical results of particular interest concern: the total value of patent rights and the relationship between changes in it and changes in the quantity of patents, the skew in the distribution of patent values, and the rate of obsolescence on the returns to patents.
The Economics and Econometrics of Innovation, 2000
This paper studies the determinants of both the percentage of innovations that are patented and the number of European patent applications by industrial firms, using data from the French survey on appropriation (EFAT). We build a two equations model including count and interval dependent variables and estimate it by asymptotic least squares. Controlling for the traditional determinants of innovation, like research and development expenditures, we find that patent disclosure is the main reason why firms do not patent all their innovations. Moreover, once we control for the differences in the propensity to patent, patent disclosure also reduces the number of patents applications. On the other hand, the will of firms to acquire a stronger position in technology negotiations and to avoid trials increases the number of patent applications.
The market value of patents and R&D: Evidence from european firms
2007
This paper provides novel empirical evidence on the private value of patents and R&D in European firms during the period 1991-2004. We explore the relationship between firm's stock market value, patents, and "quality"-weighted patents issued by the European Patent Office (EPO) and the US Patent and Trademark Office (USPTO). We find that Tobin's q is positively and significantly associated with R&D and patent stocks, but that only those patents taken out in both patent offices or at the USPTO alone seem to be valued. Either forward citations or a composite quality indicator based on forward citations, family size and the number of technical fields covered by the patent are modestly informative for value. Software patents account for a rising share of total patents in the USPTO and EPO. Moreover, some scholars of innovation and intellectual property rights argue that software and business methods patents on average are of poor quality and that these patents are applied for merely to build portfolios rather than for protection of real inventions. We found that such patents are considerably more valuable than ordinary patents, especially if they are taken out in the U.S. However their quality indicators are no more valuable than those of other patents, suggesting that their primary purpose may be to increase the size of the patent portfolio.
International Journal of Industrial Organization, 2008
We analyze the effect of patenting on R&D with a model linking a firm's R&D effort with its decision to patent, recognizing that R&D and patenting affect one another and are both driven by many of the same factors. Using survey data for the U.S. manufacturing sector, we estimate the increment to the value of an innovation realized by patenting it, and then analyze the effect on R&D of changing that premium. Although patent protection is found to provide a positive premium on average in only a few industries, our results also imply that it stimulates R&D across almost all manufacturing industries, with the magnitude of that effect varying substantially.
The market value of patents and R&D: Evidence from European firms
2007
This paper provides novel empirical evidence on the private value of patents and R&D. We analyze an unbalanced sample of firms from five EU countries -France, Germany, Switzerland, Sweden and the UK in the period 1985-2005. We explore the relationship between firm's stock market value and patents, accounting for the 'quality' of EPO patents. We find that Tobin's q is positively and significantly associated with R&D and patent stocks. In contrast to results for the U.S., forward citations do not add information beyond that in patents. However, the composite quality indicator based on backward citations, forward citations and the number of technical fields covered by the patent is informative for value.
The Market Value of Patents and R&D: Evidence from European Firms. NBER working papers
2007
This paper provides novel empirical evidence on the private value of patents and R&D in European firms during the period 1991-2004. We explore the relationship between firm's stock market value, patents, and "quality"-weighted patents issued by the European Patent Office (EPO) and the US Patent and Trademark Office (USPTO). We find that Tobin's q is positively and significantly associated with R&D and patent stocks, but that only those patents taken out in both patent offices or at the USPTO alone seem to be valued. Either forward citations or a composite quality indicator based on forward citations, family size and the number of technical fields covered by the patent are modestly informative for value. Software patents account for a rising share of total patents in the USPTO and EPO. Moreover, some scholars of innovation and intellectual property rights argue that software and business methods patents on average are of poor quality and that these patents are app...
1 The market value of patents and R&D: Evidence from European firms
2007
This paper provides novel empirical evidence on the private value of patents and R&D in European firms during the period 1991-2004. We explore the relationship between firm’s stock market value, patents, and ‘quality’-weighted patents issued by the European Patent Office (EPO) and the US Patent and Trademark Office (USPTO). We find that Tobin’s q is positively and significantly associated with R&D and patent stocks, but that only those patents taken out in both patent offices or at the USPTO alone seem to be valued. Either forward citations or a composite quality indicator based on forward citations, family size and the number of technical fields covered by the patent are modestly informative for value. Software patents account for a rising share of total patents in the USPTO and EPO. Moreover, some scholars of innovation and intellectual property rights argue that software and business methods patents on average are of poor quality and that these patents are applied for merely to b...
Scientific American
This paper estimates the determinants of the private economic value of patents from a novel and unusually comprehensive dataset built from a questionnaire survey of European EPO patents. We find that the resource investments made in the research leading to the patent are an important determinant of the value of patents. We also find that the characteristics of the individual inventor (his past patents, motivation) are a more important determinant of the private value of patents than the characteristics of the organization in which he is employed (e.g. its past patents), or the location in which the invention is carried out. Our study then supports the view that the invention business is about investments of resources and human capital more than special organizational designs or local spillovers. To validate our measure, we find that it is correlated with all the most commonly employed proxies of the value of patents.