Seminar by Jeffrey Kuhn, UC Berkeley Haas School of Business
Event details
| Date | 07.10.2015 |
| Hour | 12:00 › 13:30 |
| Speaker | Jeffrey Kuhn, PhD Candidate, UC Berkeley Haas School of Business |
| Location | |
| Category | Conferences - Seminars |
"Does Patent Scope Affect Cumulative Innovation? Evidence from Claim Narrowing During USPTO Examinations"
Abstract
Innovation is cumulative, in that new inventions are built on old ones. Patents on inventions typically cover at least some of the innovation that follows, and broader patents can potentially cover a lot of follow-on innovation. There is a large theoretical literature about patent scope and cumulative innovation, but its predictions are ambiguous and the empirical evidence is sparse.
In this paper, we study the causal effect of broader patent rights from a less stringent examination process on cumulative innovation, as measured by later citations. To do this, we construct a novel measure of patent narrowing and validate it with a cadre of volunteer legal experts. Then, following Sampat and Williams (2015), we exploit that patent examiners systematically vary in how strictly they evaluate patents. Because examiners are randomly assigned, this provides exogenous, examiner-level shocks to patent scope, which we can use to evaluate the impact on cumulative innovation.
Using this exogenous variation we find that increased patent scope leads to (i) an increase in follow-on research in that area by the patenting firm, (ii) a decrease in follow-on research in that area by other firms, (iii) a small net decrease in overall follow-on research, and (iv) that these results vary by industry. We also implicitly see that firms value broader patents more highly, as they are more likely to pay the maintenance fees required to keep them in force. Together, these results suggest that patent scope affects both the private value of the average patent as well as subsequent R&D decisions of both the patenting firm and its competitors.
Abstract
Innovation is cumulative, in that new inventions are built on old ones. Patents on inventions typically cover at least some of the innovation that follows, and broader patents can potentially cover a lot of follow-on innovation. There is a large theoretical literature about patent scope and cumulative innovation, but its predictions are ambiguous and the empirical evidence is sparse.
In this paper, we study the causal effect of broader patent rights from a less stringent examination process on cumulative innovation, as measured by later citations. To do this, we construct a novel measure of patent narrowing and validate it with a cadre of volunteer legal experts. Then, following Sampat and Williams (2015), we exploit that patent examiners systematically vary in how strictly they evaluate patents. Because examiners are randomly assigned, this provides exogenous, examiner-level shocks to patent scope, which we can use to evaluate the impact on cumulative innovation.
Using this exogenous variation we find that increased patent scope leads to (i) an increase in follow-on research in that area by the patenting firm, (ii) a decrease in follow-on research in that area by other firms, (iii) a small net decrease in overall follow-on research, and (iv) that these results vary by industry. We also implicitly see that firms value broader patents more highly, as they are more likely to pay the maintenance fees required to keep them in force. Together, these results suggest that patent scope affects both the private value of the average patent as well as subsequent R&D decisions of both the patenting firm and its competitors.
Practical information
- General public
- Free
Organizer
Contact
- cdm-seminars@epfl.ch