Patent Statistics: Eurostat quarterly review of literature ... · Patent Statistics: Eurostat quarterly review of literature on patent statistics. Eurostat quarterly review of literature

JuneSSDeJune

December 2013

Patent Statistics: Eurostat quarterly review of literature on patent statistics

Eurostat quarterly review of literature on patent statistics

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Acknowledgements

This publication has been managed by Eurostat, Unit G.6 - Innovation and information society.

Project leader

Bernard Félix — [email protected]

Eurostat, Unit G.6 - Innovation and information society

Statistical Office of the European Union

Bech Building

Rue Alphonse Weicker, 5

L-2721 Luxembourg

Production

This assessment report was prepared by Gaëtan Châteaugiron, Sogeti Luxembourg S.A.


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Table of Contents

1. INTRODUCTION 5

2. GENERAL INFORMATION ABOUT PATENT IN EUROPE 6

3. PATENTS AND INNOVATION 6

4. PATENTS AND TECHNOLOGY 16

5. PATENTS IN BIOTECHNOLOGY 21

6. PATENTS IN THE PHARMACEUTICAL INDUSTRY 25

7. PATENTS IN NANOTECHNOLOGY 30

8. PATENTS IN ENVIRONMENTAL TECHNOLOGIES 35

9. PATENTS AND CLIMATE CHANGE 39

10. PATENTS AND ENERGY TECHNOLOGIES 41

11. PATENTS AND ECO-INNOVATIONS/ENVIRONMENT 43

12. PATENTS AND SOFTWARE 49

13. PATENT VALUE 51

14. PATENT LICENSING 58

15. PATENTS AND GENDER 62

16. PATENTS AND NAME HARMONISATION 68

17. FOREIGN APPLICATIONS/CO-PATENTS/COOPERATION 70

18. PATENT CITATIONS 73

19. PATENTS IN REGIONS 83

20. PATENTS AND R&D (INVESTMENTS) 88

21. UNIVERSITY PATENTS/ACADEMIC PATENTS 95


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22. COMMUNITY PATENT 110

23. PATENT FEES/COSTS 115

24. PATENT QUALITY 117

25. PROTECTION OF BUSINESS METHODS (FINANCIAL PATENTS) 118

26. PATENT PORTFOLIOS AND VENTURE CAPITAL INVESTMENTS 120

27. PATENTS FILED FOR OTHER MOTIVES THAN INNOVATION 121

28. PATENTS AND DEVELOPING COUNTRIES 127

29. PATENTS, MARKETS AND COMPANIES 133

30. PATENT FAMILIES 136

31. PATENTS AND OTHER TOPICS 140

32. TECHNOLOGY TRANSFER: PUBLIC RESEARCH – INDUSTRY 154

33. COMMERCIAL PATENT INFORMATION PROVIDERS 159

34. RECENT ARTICLES ON PATENTS 160

34.1. EURACTIV.COM 160

34.2. CORDIS 162

34.3. OTHER 163


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1. Introduction

This report has been prepared in the framework of Eurostat’s work on patent statistics. It

consists of an extensive targeted review of the existing and currently developed

methodological, analytical and scientific material and of the most recent relevant literature in

the following domains:

1. PATSTAT data quality

2. Name harmonisation and gender;

3. Existing information and databases at institutional or company level or business

surveys: comparison and possible integration and matching of data for analytical

purposes;

4. Development of methods on patent data based on technical fields:

biotechnology,

nanotechnology,

environmental technologies,

energy, measurement of climate change,

eco-innovation,

technological innovation,

other emerging fields;

5. Development of methods for compiling information on patent families and citations;

6. Regionalisation.

An update of the report will be made available every three months.


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2. General information about Patent in Europe DG MARKT (European Commission), March 2011, STUDY ON THE QUALITY OF THE PATENT SYSTEM IN EUROPE. http://ec.europa.eu/internal_market/indprop/docs/patent/patqual02032011_en.pdf

This study is dedicated to a comprehensive assessment of the quality of the patent system in

Europe. An effective system for the protection and enforcement of intellectual property rights

represents an essential element for the growth of economies, which are based on the

generation and exploitation of new scientific and technological knowledge. The well-known

risks of market failures in the private financing of innovation investments call for a continuous

effort of policy makers to the improvements of the tools that are expected to guarantee proper

private returns from R&D activities while protecting also the interests of consumers and society

at large. The increased salience of patents to companies competing in the knowledge

economy has raised concerns throughout the world in the past decade about the actual

effectiveness of the current patent systems.

3. Patents and innovation de Rassenfosse, Gaétan & Dernis, Hélène & Guellec, Dominique & Picci, Lucio & Van

Pottelsberghe November 2012.

THE WORLDWIDE COUNT OF PRIORITY PATENTS: A NEW INDICATOR OF INVENTIVE

ACTIVITY

http://www.policypointers.org/Page/View/14718

This paper describes a new patent-based indicator of inventive activity. The indicator is based

on counting all the priority patent applications filed by a country's inventors, regardless of the

patent office in which the application is filed, and can therefore be considered as a complete

‘matrix’ of all patent counts. The method has the advantage of covering more inventions than

the selective Patent Cooperation Treaty (PCT) or triadic families counts, while at the same

time limiting the home-country bias of single-country-based indicators (inventors from a

particular country tend to file in their own country). The indicator is particularly useful to identify

emerging technologies and to assess the innovation performance of developing economies.

Christine MACLEOD, Alessandro NUVOLARI, February 2010, THE ROLE OF PATENTS IN

INDUSTRIAL DEVELOPMENT: AN HISTORICAL OVERVIEW


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http://www.lem.sssup.it/WPLem/files/2010-04.pdf

The aim of this paper is to provide an overview of the research on the role played by patent

systems in the industrialization process (with a special focus on the British case). Perhaps

surprisingly, no consensus has been reached yet as to whether the emergence of modern

patent systems exerted a favourable impact on inventive activities. However, the recent

literature has shed light on a number of fundamental factors which affect the links between

inventive activities and the patent system. The concluding section of the paper outlines some

"history lessons" for the current debate on the role of patent in economic development.

Raffaele CONTI, Alfonso GAMBARDELLA, Myriam MARIANI, January 2010, LEARNING TO

BE EDISON? HOW INDIVIDUAL INVENTIVE EXPERIENCE AFFECTS THE LIKELIHOOD

OF BREAKTHROUGH INVENTIONS

http://www2.druid.dk/conferences/viewabstract.php?id=500700&cf=44

By using data on 6 943 European inventors, we study how inventive experience affects their

ability to generate breakthrough inventions. For an inventor, the likelihood of producing a

technological breakthrough depends on the number of inventions produced, on one hand, and

on the probability that any of these inventions will be path-breaking, on the other hand. Our

theory posits that experienced inventors produce a larger number of inventions, but each one

of them is less likely to be a breakthrough. The former effect is a natural consequence of the

impact of experience on inventive productivity, while the latter effect stems from myopia due to

the exploitation of a well established technological path. The net effect of experience on

breakthroughs is positive, since path-breaking inventions are largely unpredictable and thus

producing many patents is the most effective strategy to achieve them. We first show, through

a conditional logistic regression, that experience has a negative effect on whether any given

invention is a breakthrough. A negative binomial regression with fixed effect then shows that

the rate at which new inventions are produced increases with experience; finally, by using a

fixed effect panel logit model, we find that expert inventors are more likely to achieve a

breakthrough. We conclude by discussing managerial implications about how to organize the

production of ideas in order to enhance the generation of breakthroughs.

Hitoshi TANAKAY, Tatsuro IWAISAKOZ, Koichi FUTAGAMIX, August 2009, A WELFARE

ANALYSIS OF GLOBAL PATENT PROTECTION IN A MODEL WITH ENDOGENOUS

INNOVATION AND FOREIGN DIRECT INVESTMENT

http://ideas.repec.org/p/osk/wpaper/0924.html

This paper constructs a North–South quality ladder model in which foreign direct investment


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(FDI) is determined by the endogenous location choice of firms and examines analytically how

strengthening patent protection in the South affects welfare in the South. Strengthening patent

protection increases the South’s welfare by enhancing innovation and FDI, but also allows the

firms with patents to charge higher prices for their goods, which decreases welfare. However,

the model shows that the former positive welfare effect overcomes the latter negative one, and

introducing the strictest form of patent protection in the South, that is, harmonizing patent

protection in the South with that in the North, may maximize welfare in the South as well as in

the North.

Gastón LLANES, Stefano Trento, July 2009, PATENT POLICY, PATENT POOLS, AND THE

ACCUMULATION OF CLAIMS IN SEQUENTIAL INNOVATION

http://www.hbs.edu/research/pdf/10-005.pdf

We present a dynamic model where the accumulation of patents generates an increasing

number of claims on sequential innovation. We study the equilibrium innovation activity under

three regimes: patents, no-patents and patent pools. Patent pools increase the probability of

innovation with respect to patents, but we also find that: (1) their outcome can be replicated by

a licensing scheme in which innovators sell complete patent rights, and (2) they are

dynamically unstable. We find that none of the above regimes can reach the first or second

best. Finally, we consider patents of finite duration and determine the optimal patent length.

Andrew W. TORRANCE, Bill TOMLINSON, May 2009, PATENTS AND THE REGRESS OF

USEFUL ARTS, Columbia Science and Technology Law Review, Vol. 10, 2009

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1411328

Patent systems are often justified by an assumption that innovation will be spurred by the

prospect of patent protection, leading to the accrual of greater societal benefits than would be

possible under non-patent systems. However, little empirical evidence exists to support this

assumption. One way to test the hypothesis that a patent system promotes innovation is

experimentally to simulate the behavior of inventors and competitors under conditions

approximating patent and non-patent systems. Employing a multi-user interactive simulation of

patent and non-patent (commons and open source) systems ("The Patent Game"), this study

compares rates of innovation, productivity, and societal utility. The Patent Game uses an

abstracted and cumulative model of potential innovations, a database of potential innovations,

an interactive interface that allows users to invent, make, and sell these innovations, and a

network over which users may interact with one another to license, assign, infringe, and

enforce patents. Initial data generated using The Patent Game suggest that a system

combining patent and open source protection for inventions (that is, similar to modern patent


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systems) generates significantly lower rates of innovation (p<0.05), productivity (p<0.001), and

societal utility (p<0.002) than does a commons system. These data also indicate that there is

no statistical difference in innovation, productivity, or societal utility between a pure patent

system and a system combining patent and open source protection.

Luigi MARENGO, Corrado PASQUALI, Marco VALENTE, Giovanni DOSI, April 2009,

APPROPRIABILITY, PATENTS, AND RATES OF INNOVATION IN COMPLEX PRODUCTS

INDUSTRIES

http://www.lem.sssup.it/WPLem/2009-05.html

The economic theory of intellectual property rights is based on a rather narrow view of both

competition and technological knowledge. We suggest some ways of enriching this framework

with a more empirically grounded view of both and, by means of a simulation model, we

analyze the impact of different property right regimes on the dynamics of a complex product

industry, that is an industry where products are complex multi-component objects and

competition takes place mainly through differentiation and component innovation. We show

that, as the complexity of the product spaces increases, stronger patent regimes yield lower

rates of innovation, lower product quality and lower consumers' welfare.

Andreea VASS, February 2009, TURNING IDEAS INTO MONEY. WHICH IDEAS AND

WHOM MONEY?

http://ideas.repec.org/a/aes/amfeco/v11y2009i25p181-188.html

Romania plays no part in the world technological race. In the last three decades, we have lost

the technological leadership role in the oil industry, simply because the communist regime was

reluctant to encourage the growth of information technology in general, and personal

computers in particular. Sadly, we failed to close the technological gap in the post-communist

era. Only one in five Romanian companies currently introduces a new product, service,

technology, etc., or brings about innovative business practices. This rate represents half of the

European average. We are lagging one decade behind the Czech Republic and Estonia, and

two decades behind the rest of the European Union. We did find, however, a number of

successful initiatives, rewarded at international innovation and trade shows. Unfortunately, the

overall picture is rather bleak; this paper suggests a series of possible solutions aimed at

improving it.

Zoltan J. ACS, Mark SANDERS, September 2008, INTELLECTUAL PROPERTY RIGHTS

AND THE KNOWLEDGE SPILLOVER - THEORY OF ENTREPRENEURSHIP

http://ideas.repec.org/p/use/tkiwps/0823.html


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We develop a model in which stronger protection of intellectual property rights has an inverted

U-shaped effect on innovation. Intellectual property rights protection allows the incumbent

firms to capture part of the rents of commercial exploration that would otherwise accrue to the

entrepreneurs. Stronger patent protection will increase the incentive to do R&D and generate

new knowledge. This has a positive impact on entrepreneurship and innovation. However,

after some point, further strengthening patent protection will reduce the returns to

entrepreneurship sufficiently to reduce overall economic growth.

Mark KNELL, Martin SRHOLEC, APRIL 2008, COLLABORATION IN INNOVATION AND

FOREIGN OWNERSHIP ACROSS INDUSTRIES IN EUROPE

http://archive.europe-innova.eu/servlet/Doc?cid=9897&lg=EN

Collaboration in innovation between firms and other organizations is essential for the creation,

transfer and absorption of new knowledge as it reduces the risk and complexity involved in the

innovation process. Collaboration partners may include other firms within an enterprise group,

up-stream suppliers, downstream customers, competitors, the government and universities

and other research institutes. This study includes foreign ownership and analyzes

collaboration in innovation within a cross-section of 13 countries, and considers whether

differences across industries are important. When all firms are included in the analysis, foreign

ownership increases the likelihood of international collaboration but decreases the likelihood of

local collaboration, correcting for firm size, age, industry, location, internal R&D activity, and

other aspects of the innovative behaviour of enterprises. However, when firms that carry out

their own R&D activities and collaborate internationally increases the likelihood of collaborating

locally, which suggests that locally-owned firms that collaborate internationally are an

important source of technical knowledge from abroad. The analysis found less conclusive

evidence at the industry level. This suggests that there is much heterogeneity within each

industry, and that national innovation policy and other policies related to foreign ownership do

not necessarily have to focus on particular industries but should rather follow a more horizontal

general approach.

Michael J. MEURER, James E. BESSEN, Working Paper No. 08-08, March 2008, DO

PATENTS PERFORM LIKE PROPERTY?

http://www.bu.edu/law/faculty/scholarship/workingpapers/BessenJMeurerM.html

Do patents provide critical incentives to encourage investment in innovation? Or, instead, do

patents impose legal risks and burdens on innovators that discourage innovation, as some

critics now claim? This paper reviews empirical economic evidence on how well patents

perform as a property system.


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Bronwyn H. HALL, December 2007, PATENTS AND PATENT POLICY

http://elsa.berkeley.edu/~bhhall/papers/BHH07_OxREP_patents.pdf

A patent is the legal right of an inventor to exclude others from making or using a particular

invention. This right is sometimes termed an “intellectual property right” and is viewed as an

incentive for innovation. This article surveys the evidence on patent effectiveness in

encouraging innovation and reviews the current controversies in patent policy.

Ian AYRES, Gideon PARCHOMOVSKY, September 2007, TRADABLE PATENT RIGHTS: A

NEW APPROACH TO INNOVATION

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1020276&rec=1&srcabs=1103143

Patent thickets may inefficient retard cumulative innovation. This paper explores two

alternative mechanisms that may be used to weed out patent thickets. Both mechanisms are

intended to reduce the number of patents in our society. The first mechanism we discuss is

price based regulation of patents through a system of increasing renewal fees. The second

and more innovative mechanism is quantity based regulation through the establishment of a

system of Tradable Patent Rights. The formalization of tradable patent rights would essentially

create a secondary market for patent permits in which patent protection will be bought and

sold.

Rainer FRIETSCH, Jue WANG, September 2007, INTELLECTUAL PROPERTY RIGHTS AND

INNOVATION ACTIVITIES IN CHINA: EVIDENCE FROM PATENTS AND PUBLICATIONS

http://ideas.repec.org/p/zbw/fisidp/13.html

Patenting at the SIPO is increasing greatly, but has not reached the international standard on

a broad scale. The large shares of universities and CAS institutes in technology production

must be stressed. It can be expected that with increasing quality of the R&D results and

growing international competitiveness, the division of labour will be changed. In the area of

information and communication technologies, where some companies from China already

operate alongside the top performers, this division of labour is already established. In this field,

as in new technologies in general, scientific activities are specialised in the form of

publications. A positive development can thus be expected here also, although the

international level has not yet been reached on a broad scale. The success of the past years

bodes well for the near future.

Rifat ATUN, Ian HARVEY, Joff WILD, 2006, INNOVATION, PATENTS AND ECONOMIC

GROWTH


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http://ideas.repec.org/a/wsi/ijimxx/v11y2007i02p279-297.html

Empirical evidence demonstrates the value of intellectual property (IP) in creating economic

growth. Especially in knowledge-based economies, IP plays a fundamental role in the

decisions to invest in innovation. In addition to enhancing productivity and profitability IP and

patents have a monetary value – which, as intangible assets, add to a company’s balance

sheet and increase enterprise value.

IP is critically important to research and development-intensive sectors of the economy, such

as the life sciences industries. In these industries patents are critical to competition, and

significant investments need to be made to institutionalise innovation and IP generation.

Hence, governments must create an enabling environment which encourages investment in IP

and innovation and rewards those that develop and commercialise IP. Investments that help

create in patents and create an IP portfolio are best exploited with strategic management of IP

to develop competitive advantage and to realise maximum value from patents.

At a country level, the US has approached IP strategically and created an IP infrastructure and

in Japan there is strong leadership from the Prime Minister to develop Japan into an “IP

nation.” China now has an increasingly well-developed IP system, and the Chinese

Government is aware of its shortcomings and is willing to address them. However, in the EU,

the picture is less encouraging: the patent system remains fragmented and expensive; there is

no EU-wide community patent; understanding of the importance of IP remains patchy, and, in

many quarters, ideological opposition to IP remains strong. While the UK and the Nordic

Countries demonstrate good practice, these are the exceptions rather than the rule.

The Lisbon Agenda explicitly identified the EU’s objective to become the world’s leading

knowledge based economy. Progress has been poor. Until recently, the life sciences industry

has been one of the few industries where, the EU enjoyed global competitive advantage, but

this advantage has been lost. Increased funding is needed in the EU to encourage more

research and development (R&D) and innovation and to create a more dynamic sector which

values and invests in IP generation and management. However, creation of IP is not an end in

itself – further investment is needed for the development and commercialization of the

products made possible by IP generation. But, in knowledge-intensive sectors such as the life

sciences, both R&D and commercialisation are expensive and risky: hence, an environment

which encourages IP generation must be further reinforced with a support system that

encourages development and commercialization of research outputs and provides appropriate

incentive systems and rents for companies that make such investments.

Christine MACLEOD, Alessandro NUVOLARI, 2006, INVENTIVE ACTIVITIES, PATENTS

AND EARLY INDUSTRIALIZATION. A SYNTHESIS OF RESEARCH ISSUES


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http://ideas.repec.org/p/aal/abbswp/06-28.html

The aim of this paper is to provide an overview of recent research on the role of patent

systems in the early phases of industrialization. Perhaps surprisingly, no consensus has been

reached yet as to whether the emergence of modern patent systems exerted a favourable

impact on inventive activities. However, the recent literature has shed light on a number of

fundamental factors which affect the links between inventive activities and the patent system.

The concluding section of the paper outlines some "history lessons" for the current debate on

the role of Intellectual Property Rights in economic development.

Mosahid KHAN, Hélène DERNIS, OECD 2006, DSTI/DOC(2006)3, GLOBAL OVERVIEW OF

INNOVATIVE ACTIVITIES FROM THE PATENT INDICATORS PERSPECTIVE

http://www.oecd.org/dataoecd/29/46/36599850.pdf

This paper provides an overview of innovative activities across a wide range of OECD member

and non-member countries, based on international comparable patent indicators. Patent data

are frequently used to measure innovative activities, because patent-based indicators reflect

the inventive performance of countries, regions, firms, as well as other aspects of the

dynamics of the innovation process.

Analysis of data from a wide range of sources (e.g. triadic patent families, EPO, USPTO, etc.)

shows that there has been a significant increase in the level of patenting for all the countries

over the past 15 years. Most of the increase in EPO patents is accounted for by European

inventors and similarly, US inventors accounted for the majority of the increase in USPTO

patents. The share of European countries (EU-25) in all EPO patents has remained stable

between 1991 and 2002. In contrast, the share of the United States in all USPTO patents has

increased by 5 percentage points. Developing countries (such as Brazil, China and India)

account for a small share of triadic, EPO and USPTO patents. However, their growth rates in

recent years have been higher than that of the OECD countries. There has also been an

increase in internationalisation of patenting activities (cross-border ownerships and patents

with foreign co-inventors), reflecting the globalisation dimension of Science and Technology

activities. ICT and biotechnology industries’ innovative activities tend to be more

internationalised than the overall level of internationalisation. In addition, non-member

countries, such as China, India and the Russian Federation have a high level of

internationalisation compared to large OECD countries. Breakdown of internationalisation

indicators by partner country shows that common language, historical links and geographical

proximity play an important role in determining partner countries.


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François LÉVÊQUE and Yann MÉNIÈRE, December 2006, PATENTS AND INNOVATION:

FRIENDS OR FOES?

http://www.cerna.ensmp.fr/Documents/FL-YM-PatentsInnovationJanuary07.pdf

What are the impacts of the patent system on innovation? The report addresses this question

in surveying the economic literature that has flourished on patents over the past ten years.

Four main economic impacts are successively discussed: the creation of incentives to

innovate, the diffusion of knowledge through information disclosure, facilitating technology

transfers through licensing, and the organization of cumulative R&D. The first three impacts

correspond to the key roles of intellectual property rights. The fourth one focuses on the most

debated and complex effects of patents in sectors such as software and biotechnology.

Alex COAD, Rekha RAO, June 2006, INNOVATION AND FIRM GROWTH IN HIGH-TECH

SECTORS: A QUANTILE REGRESSION APPROACH


We relate innovation to sales growth for incumbent firms in high-tech sectors. A firm, on

average, experiences only modest growth and may grow for a number of reasons that may or

may not be related to ‘innovativeness’. However, given that the returns to innovation are highly

skewed and that growth rates distributions are heavy-tailed, it may be misleading to use

regression techniques that focus on the ‘average effect for the average firm’. Using a quantile

regression approach, we observe that innovation is of crucial importance for a handful of

‘superstar’ fast-growth firms. We also discuss policy implications of our results.

OECD Roundtables 2006: COMPETITION, PATENTS AND INNOVATION


The questions of how competition and patent rights affect innovation have fascinated and

stymied economists for decades. This roundtable focused on recent theoretical and empirical

findings. A formidable panel of experts was assembled discuss those findings as well as its

views on how to encourage innovation. The first main issue was whether competition stifles

innovation or promotes it. Although there seems to be no universally-applicable relationship,

many industries exhibit an inverted U-shape correlation between competition and innovation.

In other words, moderate levels of competition seem to be most highly correlated with more

innovation. There were conflicting views among the delegates and some panellists regarding

the advisability of implementing compulsory licensing remedies in competition cases, with

some contending that such remedies will destroy incentives to innovate and others arguing

that their occasional use is necessary and not overly harmful to innovation. The Committee

then discussed the relationship between patent rights and innovation, which varies


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considerably from industry to industry. Some sectors rely heavily on patents to protect the

value of their inventions, while others rely more on alternative means such as secrecy and

lead time. Time did not permit a thorough discussion of the various strategies that competition

agencies are using to cooperate with patent agencies in an effort to improve the interaction

between patent policy, competition policy, and innovation, but several of the written

contributions discussed that subject in more detail.

Diana WEINHOLD, Usha NAIR-REICHERT, February 2005, INNOVATION, INEQUALITY

AND INTELLECTUAL PROPERTY RIGHTS

http://129.3.20.41/eps/dev/papers/0410/0410002.pdf

The existing literature on the sources and nature of productivity growth during the early

industrialization stages of U.S. has identified the combination of intellectual property rights

(IPRs) with a large middle class and broad participation in markets as explanations for the

extraordinary level and growth of patenting. This paper considers whether these factors could

play a role in the contemporaneous evolution of innovation in a broad cross section of

countries today. Our results indicate that IPRs and the size of the middle class help explain

patterns of resident, but not non-resident patenting. Overall, the evidence suggests that non-

resident patenting patterns are driven more by exogenous factors and global integration, while

'home grown' innovation is more sensitive to internal structural and institutional factors.

Emmanuel DUGUET and Claire LELARGE, September 2004, DOES PATENTING INCREASE

THE PRIVATE INCENTIVES TO INNOVATE? A MICROECONOMETRIC ANALYSIS


This paper examines whether patenting increases the private incentives to innovate in

manufacturing. To study this issue, we build a model in which the value of an innovation

depends both on the type of innovation implemented (product, process) and on the existence

of a patent protection or not. We obtain a three-equation model that links the values of product

and process innovations to the value of patent protection. This model and the feature of the

data imply the estimation of a censored trivariate Probit model. We reach two main

conclusions. First, the value of patent rights increases the incentives to innovate in products

but not in processes and, conversely, the value of product innovations only – and not the one

of process innovations – increases the incentives to patent. Second, we find that the

distributions of product innovations and of patent values are skewed contrary to the values of

process innovations. A significant share of the skewness in product values would come from

the efficiency differences of intellectual property rights between the different activities.


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OECD, 2004, PATENTS AND INNOVATION: TRENDS AND POLICY CHALLENGES


Patents play an increasingly important role in innovation and economic performance. Between

1992 and 2002, the number of patent applications filed in Europe, Japan and the United States

increased by more than 40%. The increasing use of patents to protect inventions by

businesses and public research organisations is closely connected to recent evolutions in

innovation processes, the economy and patent regimes. Scientific and technological advances

have created new waves of innovation, notably in information and communications technology

(ICT) and biotechnology, and innovation processes themselves have become centred less on

individual firms and more dependent on interactions among global networks of actors in the

public and private sectors. Shifts in the legal and regulatory framework of patent regimes have

resulted in more expansive domains of patentable subject matter (patent regimes in many

countries now include biotechnology and software), and more robust and more valuable

patents.

Bronwyn H. HALL, Working Paper No. E03-331, May 2003, BUSINESS METHOD PATENTS,

INNOVATION, AND POLICY

http://euro.ecom.cmu.edu/program/law/08-732/Patents/BusinessMethodPatents.pdf

The trickle of business method patents issued by the United States Patent Office became a

flood after the State Street Bank decision in 1998. Many scholars, both legal and economic,

have critiqued both the quality of these patents and the decision itself. This paper discusses

the likely impact of these patents on innovation. It first reviews the facts about business

method and internet patents briefly and then explores what economists know about the

relationship between the patent system and innovation. It concludes by finding some

consensus in the literature about the problems associated with this particular expansion of

patentable subject matter, highlighting remaining areas of disagreement, and suggesting

where there are major gaps in our understanding of the impact of these patents.

Bronwyn H. HALL, February 2002, PATENTS AND INNOVATION, UC Berkeley and NBER

http://www.ftc.gov/opp/intellect/020226bronwynhhall.pdf

Powerpoint presentation

4. Patents and technology

Fischer, Timo & Henkel, Joachim, 2012, PATENT TROLLS ON MARKETS FOR

TECHNOLOGY – AN EMPIRICAL ANALYSIS OF NPES’ PATENT ACQUISITIONS


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http://ideas.repec.org/a/eee/respol/v41y2012i9p1519-1533.html

Patent trolls, or NPEs, appropriate profits from innovation solely by enforcing patents against

infringers. They are often characterized as relying on low-quality patents, an assessment that,

if correct, would imply that eradicating such patents would effectively terminate the NPE

business. In this paper, we shed light on this issue by empirically analyzing NPEs’ patent

acquisitions. We draw on a unique dataset of 392 U.S. patents acquired by known NPEs

between 1997 and 2006, which we compare to three control groups of 784 U.S. patents each

acquired by practicing firms. We find that the probability that a traded patent is acquired by an

NPE rather than a practicing entity increases in the scope of the patent, in the patent density

of its technology field and, contrary to common belief, in the patent's technological quality. Our

findings thus support recent theoretical propositions about the NPE business model, showing

that NPEs procure patents that are more likely to be infringed, harder to substitute for, and

robust to legal challenges. The fact that NPE-acquired patents are of significantly higher

quality than those in the control group implies that elevating minimum patent quality will not put

an end to the NPE business, and suggests that this business is sustainable in the long run.

We furthermore discuss the fact that NPEs are peculiar players on markets for technology

insofar as they are solely interested in the exclusion right, not in the underlying knowledge. We

posit that transactions involving NPEs may only be the tip of the iceberg of “patent-only”

transactions, a conjecture with strong implications for the efficiency and the study of markets

for technologies. Managerial and policy implications are discussed.

Tomoya YANAGISAWA and Dominique GUELLEC, December 2009, THE EMERGING

PATENT MARKETPLACE


Facilitating the mobilisation, sharing, or exchange of patents is increasingly important to

promote innovation in this globalised and well-networked world, where the circulation of ideas

and technologies is essential to innovation. In the context of open innovation, patents are

expected to play a role as a means for transferring ideas and technologies from one entity to

another, in addition to acting as a means for excluding others from using companies’ own

ideas and technologies. In such a situation, a variety of new entities focusing on patent-related

transactions are emerging. Some IP specialist firms seek to monetize patents by creating

strategic patent portfolios and licensing them. Others provide websites to establish online

marketplaces where patents and ideas could be traded. And still others establish a co-

operative venture that buys and licenses patents to its members for defensive purpose. They

also include IP investment banks that will lend against the value of IP, and firms that seek to


18

create funds, similar to mutual funds, which allow investors to earn revenue from royalties.

These new players now could significantly influence the circulation of patents. It would be

important for governments to deepen their understanding of how these new players are

performing in the patent transaction markets in order to support their development in the most

socially beneficial directions. This may also be important for traditional technology-oriented

companies, since the effective use of patent transaction markets will help them improve their

innovation process and strengthen their competitiveness. Therefore, analysis of the functions,

business models, and activities of IP specialist firms is the central topic of this research.

Rudi BEKKERS, René BONGARD, Alessandro NUVOLARI, June 2009, ESSENTIAL

PATENTS IN INDUSTRY STANDARDS: THE CASE OF UMTS

http://www2.druid.dk/conferences/viewpaper.php?id=5587&cf=32

We study the determinants of essential patents in industry standards. In particular, we assess

the role of two main factors: the significance of the technological solution contained in the

patent and the involvement of the applicant of the patent in the standardization process. To

this end, we examine the case of UMTS one of the most successful standards in the area of

mobile telecommunications. We compare the patents claimed essential for the UMTS standard

with a group of randomly selected control patents covering the same time frame and

technology classes. We establish that both the technological significance of the patent

(measured using forward citations) and the applicant s involvement in the standardization

process have a positive effect on the probability that a patent will be claimed as essential . On

the basis of our findings, we offer policy recommendations.

Camilla LENZI, 2007, TECHNOLOGY MOBILITY AND JOB MOBILITY: A COMPARATIVE

ANALYSIS BETWEEN PATENT AND SURVEY DATA

http://www.immagic.com/eLibrary/ARCHIVES/GENERAL/DRUID_DK/D071211L.pdf

In recent years, increasing attention and resources have been devoted to the analysis of

workers’ mobility and the collection of new and extensive datasets in order to monitor and

appraise this phenomenon. Most of the studies make use of information about inventors

extracted from patent data. In fact, patent data collects detailed information on inventors, their

geographical location and the applicants of their patents.

This paper instead makes use of unique data on inventors’ curriculum vitae collected through

a survey addressed to a group of Italian inventors in the pharmaceutical field and compares

this information to those extracted from patent data.

Results seem to challenge the traditional interpretation of mobility phenomena based on

patent data and suggest that patent and survey data might capture different aspects of


19

inventors’ career path. In particular, results indicate that survey data describes the whole set of

inventors’ employers and the knowledge flows across them. Conversely, patent data portrays

a different set that is the one composed of those actors directly involved in inventive processes

and participating to the production of patented knowledge. More interestingly, they overlap

only partially and do not necessarily coincide.

Mario CIMOLI, Annalisa PRIMI, March 2008, TECHNOLOGY AND INTELLECTUAL

PROPERTY: A TAXONOMY OF CONTEMPORARY MARKETS FOR KNOWLEDGE AND

THEIR IMPLICATIONS FOR DEVELOPMENT


This paper aims to contribute to frame the IP for development debate into a more extensive

discussion on appropriability, within the perspective of policies shaping scientific, technological

and production capabilities in the light of development theory. Through the lenses of the

paradigm based theory of innovation, the authors first recognize that technological

asymmetries and gaps between firms and countries appear more as sticky features than as

transitory stages of (automatic) adjustment processes, thus reassessing the appropriability ad

disclosure function of patents. Then, the paper presents a taxonomy of contemporary markets

for knowledge, flagging the existence of what we call derivative markets for knowledge.

Patents become to a certain extent liquid because they loose the weight and the density of the

technological component and they can easily circulate in the market without having

necessarily to be entangled in any final artifact. Just as in derivative financial markets, the

value of patents is a function of expectations regarding their uncertain potential future value.

The paper concludes sketching the implications for development focusing on two major issues:

i) how reassessing the role of IP through an evolutionary perspective affects behavioral

microfoundations of innovative conducts and ii) how asymmetries in technological and

production capacities between countries mould patenting behavior and participation and

exclusion in the contemporary markets for knowledge.

Bin XU and Eric P. CHIANG, March 2005, TRADE, PATENTS AND INTERNATIONAL

TECHNOLOGY DIFFUSION, J. Int. Trade & Economic Development, Vol. 14, No. 1, 115 –

135

http://www.iprsonline.org/resources/docs/XuChiangTechDiffus.pdf

This paper investigates international technology diffusion through trade and patenting in a

sample of 48 countries for the period 1980 – 2000. We divide the sample in three income

groups to detect different patterns of technology absorption. Our results show that rich

countries benefit from domestic technology and foreign technology embodied in imported


20

capital goods, middle-income countries enjoy technology spillovers from foreign patents and

imported capital goods, and poor countries benefit mainly from foreign patents. We find that

government policies on intellectual property rights protection and trade openness have large

effects on foreign technology spillovers in middle- and low-income countries.

Biju Paul ABRAHAM, Soumyo D. MOITRA, January 2005, ANALYSIS OF INTERNET

PATENTING STRATEGIES OF E-COMMERCE FIRMS

http://www.esocialsciences.com/data/articles/Document12262010170.110943.pdf

Patents and patent applications are important indicators of innovative activity in industrial R &

D, especially in areas such as Information Technology (IT), where technology growth is rapid.

Within the IT sector this is especially true of patents for Internet-related technologies where

patenting is often the only way by which entry-barriers can be erected against competitors.

This paper presents the analysis of Internet-related patent applications that have been filed

under the Paris Cooperation Treaty (PCT) of the World Intellectual Property Organization

(WIPO) by fourteen major international firms. We analyze the patent applications of these

firms to identify the business application, technology type and countries designated in these

applications. An analysis of this data is done to try to understand the patenting behavior of the

major firms in the area of e-commerce. We also suggest a number of areas for future

research.

Bronwyn H. HALL, Manuel TRAJTENBERG, October 2004, UNCOVERING GPTS WITH

PATENT DATA

http://elsa.berkeley.edu/~bhhall/papers/HallTrajtenberg04_GPT.pdf

This paper asks the question: Can we see evidence of General Purpose Technologies in

patent data? Using data on three million US patents granted between 1967 and 1999, and

their citations received between 1975 and 2002, we construct a number of measures of GPTs,

including generality, number of citations, and patent class growth, for patents themselves and

for the patents that cite the patents. A selection of the top twenty patents in the tails of the

distribution of several of these measures yields a set of mostly ICT technologies, of which the

most important are those underlying transactions on the internet and object-oriented software.

We conclude with a brief discussion of the problems we encountered in developing our

measures and suggestions for future work in this area.

Dominique GUELLEC, Bruno VAN POTTELSBERGHE DE LA POTTERIE, Research Policy

30(8) 2001, THE INTERNATIONALISATION OF TECHNOLOGY ANALYSED WITH PATENT

DATA


21

http://www.ulb.ac.be/cours/solvay/vanpottelsberghe/resources/Pap_ResPol_1.pdf

This paper presents three new patent-based indicators of internationalisation of technology

reflecting international co-operation in research and the location of research facilities of

multinational firms. They witness both an increasing trend towards the globalisation of

technology in the OECD area and large cross-country differences in the extent of

internationalisation. An empirical analysis shows that the degree of technological

internationalisation is higher for small countries and for countries with low technological

intensity. Finally, two countries are more likely to collaborate if they are close to each other, if

they have a similar technological specialisation and if they share a common language. Being

member of the European Union involves more cross-border ownership but does not entail

more research co-operation than it is implied by the above factors. Nordic countries have a

particularly high propensity to collaborate together.

Bronwyn H. HALL, Rose Marie HAM, April 1999, THE PATENT PARADOX REVISITED:

DETERMINANTS OF PATENTING IN THE US SEMICONDUCTOR INDUSTRY, 1980-94


This paper examines the patenting behavior of firms in an industry characterized by rapid

technological change and cumulative innovation. Recent evidence suggests that

semiconductor firms do not rely heavily on patents, despite the strengthening of US patent

rights in the early 1980s. Yet the propensity of semiconductor firms to patent has risen

dramatically over the past decade. This paper explores this apparent paradox by analyzing the

patenting activities of almost 100 US semiconductor firms during 1980-94. The results suggest

that stronger patents may have facilitated entry by firms in niche product markets, while

spawning “patent portfolio races” among capital-intensive firms.

5. Patents in biotechnology

Shardul Agrawala, Cécile Bordier, Victoria Schreitter, Valerie Karplus March 2012

ADAPTATION AND INNOVATION: AN ANALYSIS OF CROP BIOTECHNOLOGY PATENT

DATA

http://ideas.repec.org/p/oec/envaaa/40-en.html

Innovation in technologies that promote mitigation and adaptation will be critical for tackling

climate change. It can decrease the costs of policy measures and provide new opportunities

for the private sector. However, most discussions of innovation have focused on mitigation,

while little attention has been paid to innovation for adaptation. This paper uses agricultural


22

crop biotechnology as a case study of innovative activity. The agricultural sector is considered

to be particularly vulnerable to climate change, in addition to facing the pressures of meeting

the demands of a rising world population. Innovation in plant breeding to develop crop

varieties that are more resilient to climate change impacts is one of several possible

adaptation options for agriculture. This paper neither advocates nor discourages the use of

biotechnology, but focuses on providing estimates of the level and trends of innovation in this

field.

John L. KING, July 2009, MULTINATIONAL TECHNOLOGY DIFFUSION IN AGRICULTURE

http://ideas.repec.org/p/ags/aaea09/49820.html

This paper presents data on international technology diffusion of agricultural biotechnology.

Patent family data, which identify related intellectual property in different countries with the

same owner, represents technology flows between countries. Technology flows occur mostly

between developed countries, and are similar for different types of entities (private, non-profit

and university, government) that seek patent protection abroad. Technology diffusion through

patent families is a significant predictor of international trade flows, which is consistent with

several different models of trade.

Enrico SORISIO, July 2009, PATENTING ACTIVITY IN BIOTECHNOLOGY AND

PHARMACEUTICALS: A COMPARATIVE ANALYSIS OF THE NORDIC COUNTRIES

http://ideas.repec.org/p/tik/inowpp/20090722.html

The main aim of this paper is to study innovative activity, as measured by patent indicators, in

pharmaceutical and biotechnological sectors in the Nordic Countries. The biotech sector in

general and pharmaceutical in particular is one of the areas selected for strategic investments

in every Nordic country. In terms of patents granted by country of inventors Denmark plays a

leading role followed by Sweden, while patenting activity in Finland and Norway is lower. A

concentration of patents towards a relative small number of assignees (mainly large biotech

and pharmaceutical companies based in Denmark and Sweden) is also observed. Norwegian

patents, as measured by patent citations indices, are more “important” than those of the other

countries, as well as in terms of relative size of innovations. Although there are other

contributing factors, our data suggest that geographical proximity to large pharmaceutical

companies plays a role in determining the relative success of national policies, and also that

new investment policies in countries where large biotech or pharmaceutical companies are not

established can yield positive returns in terms of innovation growth.


23

Martha Judith PREVEZER, February 2009, PATENTING AND OPEN-SOURCE AND

EFFECTS ON INNOVATION AND RESEARCH: COMPARISON OF BIOTECHNOLOGY

WITH SOFTWARE AND OF AGRICULTURAL BIOTECH WITH BIOMEDICAL BIOTECH


This paper is an examination of the issues of patenting and open-source IPR and effects on

R&D and innovation. It looks at the arguments for and against patenting. It compares the

issues in open source software and open source biotechnology. It compares the structures of

the software and biotechnology industries and of the agricultural biotech with biomedical

biotech sectors to think about the difficulties or appropriateness of open source in these

different sectors.

EUROPEAN PATENT OFFICE, 2008, BIOTECHNOLOGY IN EUROPEAN PATENTS -

THREAT OR PROMISE?

http://www.epo.org/news-issues/issues/biotechnology.html

Over the past decade, few technical fields have attracted more public attention than

biotechnology. Advances in medicine, agriculture, environmental engineering and other related

areas mean growing numbers of patent applications together with ever more products coming

onto the market. At the same time, the debate about the patentability of biotechnological

inventions continues.

Ralf D. KIRSCH, Claus BECKER and Thomas WESTPHAL, Euro|Biotech|News ,2008,

DEPENDENT PATENTS IN BIOTECHNOLOGY

http://www.glawe.de/downloads/In_Einsteins_Footsteps.pdf

Patents that cannot be used without violating the scope of another “ruling” patent are known

as “dependent patents”. Comments made by Albert Einstein about “dependent patents” in a

1919 patent case are still valid today. Dependent patents in the biotech field are often based

on a “selection invention”, where a selection of a narrow region having surprising effects is

made within a broader, better-known region (e.g. certain dose ranges of a pharmaceutical

formulation, enzymes, etc.). Selection inventions are usually patentable, and generally work

particularly well as Europe-wide patents. Unfortunately, one exception to the rule is Germany,

where national case law on selection inventions is more restrictive.

Bevis FEDDER, 2008, MARINE BIOTECHNOLOGY AND PATENTS

http://www.grin.com/e-book/120146/marine-biotechnology-and-patents

Major industries relating to inventions in marine biotechnology increasingly apply for patents.

Most patents are applied for inventions that are derived from terrestrial biotechnology.


24

However, it is recognized that marine biotechnology offers a high potential to yield inventions

as well. Marine biotechnology can be divided into two main areas. First, development of

commercially viable drugs obtained from marine bioprospecting and, second, development of

marine genetically modified organisms for aquacultural and environmental purposes. A patent

means intellectual protection for an invention. Intellectual protection confers the exclusive right

upon the patent holder to sell the right of utilization of the invention to interested parties. The

selling of licenses provide one important way of receiving revenues for the research done for

the invention. The prospect of potential revenues provide the incentive for investment into

biotechnological research and subsequent patenting of inventions arising thereof. The overall

aim of this work is to illustrate the close interrelationship of science and law by using marine

biotechnology and patents as an example. Section two provides an overview on the scientific

side of marine biotechnology. It will define marine biotechnology and investigate current

advancements in marine biotechnology. Additionally, it roughly explains the international

patent system governing inventions in the biotechnological area and provide examples on

patents related to marine biotechnology. Section three illustrates the criticism expressed

against life form patents in marine as well as terrestrial biotechnology. It will describe the most

important cases that have fueled controversial debates on life form patents until today.

Sven HETMANK, Heike RÖDER, CRTD – Symposium On Patent Rights and Technology

Transfer, 2007, EUROPEAN PATENTS FOR STEM CELLS, BIOTECHNOLOGY AND

BIOMATERIALS

http://www.crt-dresden.de/fileadmin/Upload/RoederHetmank.pdf


Bart VAN LOOY, Tom MAGERMAN, Koenraad DEBACKERE, January 2006, DEVELOPING

TECHNOLOGY IN THE VICINITY OF SCIENCE: AN EXAMINATION OF THE

RELATIONSHIP BETWEEN SCIENCE INTENSITY (OF PATENTS) AND TECHNOLOGICAL

PRODUCTIVITY WITHIN THE FIELD OF BIOTECHNOLOGY

http://papers.ssrn.com/sol3/Delivery.cfm/SSRN_ID874918_code444941.pdf?abstractid=87491

8

In this paper we investigate - on a country level - the relationship between the science intensity

of patents and technological productivity, taking into account differences in terms of scientific

productivity. The number of non patent references in patents is considered as an

approximation of the science intensity of technology whereas a country's technological and

scientific performance is measured in terms of productivity (i.e. number of patents and

publications per capita). We use USPTO patent-data pertaining to biotechnology for 20


25

countries covering the time period 1992-1999. Our findings reveal mutual positive relationships

between scientific and technological productivity for the respective countries involved. At the

same time technological productivity is associated positively with the science intensity of

patents. These results are confirmed when introducing time effects. These observations

corroborate the construct validity of science intensity as a distinctive indicator and suggest its

usefulness for assessing science and technology dynamics.

6. Patents in the pharmaceutical industry

Frederick M. ABBOTT, 2009, SEIZURE OF GENERIC PHARMACEUTICALS IN TRANSIT

BASED ON ALLEGATIONS OF PATENT INFRINGEMENT: A THREAT TO INTERNATIONAL

TRADE, Development and Public Welfare, World Intellectual Property Organization Journal

(WIPO), Vol. 1, p. 43


This essay addresses the legitimacy of seizures by the customs authorities of some European

Union member states of pharmaceutical products moving in transit through European ports

and airports based on patents in force in the transit countries. Seizures have been directed to

products off-patent in the countries of manufacture and destination. EU member state customs

authorities have justified such seizures on the basis of a 2003 EU intellectual property border

enforcement regulation. The seizures have generated intense controversy at the WTO and

more widely among stakeholders interested in assuring affordable access to medicines. This

essay argues that seizure of generic pharmaceutical products in transit contravenes GATT

article V that obligates WTO Members to assure freedom of transit for goods passing through

ports and airports, and obligates Members to refrain from imposing unreasonable regulations

on such transit goods. It further argues that the seizures are fundamentally inconsistent with

the Paris Convention principle of independence of patents that recognizes the sovereign right

of states to adopt and implement patent protection as they consider appropriate, within the

framework of a general set of rules. Rules permitting enforcement of transit country patents

effectively deprives exporting and importing Paris Union and WTO Members of their right to

make determinations regarding patents, and represents an overextension of patent jurisdiction

by countries without a substantial interest in enforcement. Dutch court adoption of a

manufacturing fiction to justify transit seizures – pretending that subject pharmaceuticals are

manufactured in the Netherlands, when they clearly are not – represents a significant potential

threat to the conduct of international trade. Each WTO Member might pretend that all manner

of its domestic regulation – labor, environmental, social welfare – was violated in an exporting

country when goods were manufactured, allowing the goods of that country to be seized in


26

transit for a violation of transit country law. The international trading system could not function

reasonably in such a fiction-laden environment. The seizure of generic pharmaceutical

products in transit is inconsistent with the object and purpose of the Doha Declaration on the

TRIPS Agreement and Public Health that promotes access to medicines for all.

Birgitte ANDERSEN, Federica ROSSI, Johannes STEPHAN, August 2009, INTELLECTUAL

PROPERTY (IP) MARKETPLACES AND HOW THEY WORK: EVIDENCE FROM GERMAN

PHARMACEUTICAL FIRMS

http://www.dime-eu.org/files/active/0/WP88-v2-IPR.pdf

By exploring the patterns of engagement in several intellectual property (IP) marketplaces on

the part of a sample of pharmaceutical firms based in Germany, the article attempts to shed

light on the strategic reasons which induce firms to participate in different IP marketplaces and

governance structures, often at the same time.

The scope of the analysis includes not only the conventional proprietary marketplaces (patents

and copyright) but also non-proprietary marketplaces (open source and trade in non-patented

technology). Marketplaces are viewed as institutions that allow firms to realize strategic value

but which, due to institutional inefficiencies, may fail to deliver firms the benefits they seek.

Therefore, the obstacles that prevent IP marketplaces from functioning smoothly and efficiently

are also investigated.

The analysis suggests that different marketplaces and governance forms contribute to the

realization of specific forms of value for firms, and suffer from specific failures. In-depth

investigation and comparison of IP marketplaces and governance forms is therefore a

promising and useful area for policy-relevant research.

Paul GROOTENDORST, July 2009, Patents, PUBLIC-PRIVATE PARTNERSHIPS OR

PRIZES: HOW SHOULD WE SUPPORT PHARMACEUTICAL INNOVATION? SEDAP

Research Paper No. 250

http://socserv.mcmaster.ca/sedap

The question as to how society should support pharmaceutical (‘pharma’) innovation is both

pertinent and timely: Pharma drugs are an integral component of modern health care and hold

the promise to treat more effectively various debilitating health problems. The productivity of

the pharma R&D enterprise, however, has declined since the 1980s. Many observers question

whether the patent system is conducive to pharma innovation and point to several promising

alternative mechanisms. These mechanisms include both ‘push’ programs – subsidies

directed towards the cost of pharma R&D – and ‘pull’ programs – lumpsum and royalty-based

rewards for the outputs of pharma R&D, that is, new drugs. I review evidence why our current


27

system of pharma patents is defective and outline the various alternative mechanisms that

may spur pharma innovation more effectively.

Laura MAGAZZINI, Fabio PAMMOLLI, Massimo RICCABONI, Maria Alessandra ROSSI, April

2009, PATENT DISCLOSURE AND R&D COMPETITION IN PHARMACEUTICALS

http://ideas.repec.org/p/trt/disawp/0902.html

The prominent role played by patents within the pharmaceutical domain is unquestionable. In

this paper we take an unusual perspective and focus on a relatively neglected implication of

patents: the effect of patent-induced information disclosure (of both successes and failures) on

the dynamics of R&D and market competition. The study builds upon the combination of two

large datasets, linking the information about patents to firm level data on R&D projects and

their outcome.

Two case studies in the fields of anti-inflammatory compounds and cancer research

complement our analysis. We show the important role played by patent disclosure in shaping

firms technological trajectories through the possibility of reciprocal monitoring in a context of

parallel research efforts, and suggest the importance of enhancing the diffusion of information

concerning failures, not only to avoid wasteful duplication of innovative efforts, but also as a

tool for the identification of promising research trajectories.

Stuart J.H. GRAHAM, Matthew J. HIGGINS, August 2007, THE IMPACT OF PATENTING ON

NEW PRODUCT INTRODUCTIONS IN THE PHARMACEUTICAL INDUSTRY

http://mpra.ub.uni-muenchen.de/4574

Since Comanor and Scherer (1969), researchers have been using patents as a proxy for new

product development. In this paper, we reevaluate this relationship by using novel new data.

We demonstrate that the relationship between patenting and new FDA approved product

introductions has diminished considerably since the 1950s, and in fact no longer holds.

Moreover, we also find that the relationship between R&D expenditures and new product

introductions is considerably smaller than previously reported. While measures of patenting

remain important in predicting the arrival of product introductions, the most important predictor

is the loss of exclusivity protection on a current product. Our evidence suggests that

pharmaceutical firms are acting strategically with respect to new product introductions. Finally,

we find no relationship between firm size and new product introductions.

Camilla LENZI, October 2006, KNOWLEDGE TRANSFER TROUGH JOB MOBILITY:

EVIDENCE FROM A SURVEY OF ITALIAN INVENTORS

http://ideas.repec.org/p/cri/cespri/wp182.html


28

Knowledge transfer issues are of great interest in researchers and policy makers agenda

because of its implications in terms of innovation diffusion and economic welfare. Among the

others, workers’ mobility, namely highly skilled ones, is considered as one of the most

influential channels for knowledge transmission.

This paper examines the patterns of mobility of a group of Italian inventors in the

pharmaceutical sector. New empirical evidence is discussed and results of the analysis

support the idea that workers’ mobility is an important mechanism of valuable knowledge

diffusion. Moreover, the paper critically discusses methodological issues concerning measures

of inventors’ mobility through patent statistics.

Stefano BRUSONI, Paola CRISCUOLO, Aldo GEUNA, January 2003, THE KNOWLEDGE

BASES OF THE WORLD’S LARGEST PHARMACEUTICALS GROUPS: WHAT DO PATENT

CITATIONS TO NON-PATENT LITERATURE REVEAL?, paper No. 90

http://www.sussex.ac.uk/spru/ http://ideas.repec.org/a/taf/ecinnt/v14y2005i5p395-415.html

This paper examines the knowledge bases of the world’s largest pharmaceuticals groups by

sales. It puts forward the concepts of knowledge breadth and depth as the relevant

dimensions along which knowledge bases can be mapped. Breadth is studied by analysing the

evolution of specialisation by scientific field over time. It hints at the widening range of bodies

of scientific and technological knowledge relevant to firms’ innovative activities. Depth (or

integration) is studied by analysing the evolution of specialisation across different typologies of

research. It hints at the complex, non-linear interdependencies that link the scientific and

technological domains. We develop the analyses on the strength of an original database of

33,127 EPO patents, and of 41,931 ‘non patent document’ citations (of which 19,494 were

identified as scientific articles included in the ISI databases). The groups studied seem to have

incrementally increased the breadth of their knowledge bases, moving toward the fields proper

of the new bio-pharmaceutical research trajectory. At the same time, some of the groups

studied exhibit remarkable depth in knowledge specialisation in particular fields such as

biotechnology, biochemical research and neurosciences. Finally, this paper also provides a

first methodological test of possible problems deriving from the use of ‘unidentified’ patent

citations (i.e. added by the examiners together with those proposed by the inventor). We

compare a random sample of these citations with a sample of citations explicitly added by the

original inventor, and compare the results in terms of scientific specialisations.

Bruce LEHMAN, 2003, THE PHARMACEUTICAL INDUSTRY AND THE PATENT SYSTEM

http://users.wfu.edu/mcfallta/DIR0/pharma_patents.pdf


29

Patents are exclusive property rights in intangible creations of the human mind. They exist

only as provided in the laws of sovereign states, and can be enforced only to the extent that

application has been made and a patent granted covering the territory of an individual state.

Patent rights are limited in duration, with the global standard being 20 years from the date of

application. The new product, article of manufacture or process described in the patent

application must be something that has never been previously disclosed anywhere in the world

and something that would not be obvious to a person ordinarily skilled in the field involved.

Determinations of whether these requirements have been met are made by comparing the

claims of the patent applicant against the body of published literature in the field, including

previously issued patents. This process is called examination, and it assures that no one is

able to claim patent rights on anything that already is existence.

Patents work differently indifferent industries. In the electronic industry patents are often

shared among competitors through pooling or cross licensing. This sharing is necessary

because a given product often contains many patented technologies. However, in the

pharmaceutical, chemical and biotechnology industries the patent normally equals the product,

and protects the extensive investment in research and clinical testing required before placing it

on the market. Patent protection for chemical and pharmaceutical products is especially

important compared with other industries because the actual manufacturing process is often

easy to replicate and can be copied with a fraction of the investment of that required for the

research and clinical testing.

The extensive cost required to produce a new pharmaceutical product has meant that private

sector investment in pharmaceutical innovation has been disproportionately directed to

products meeting the needs of patients in developed countries, particularly in the United

States, which combines strong patent protection with a market free of price controls.

Until the TRIPS Agreement in 1994 many developing countries provided no patent protection

for pharmaceutical products. And, while countries that have joined the WTO have obligated

themselves to provide such protection, least developed countries are not required to meet this

obligation until 2016. The continuing lack of patent protection for pharmaceutical products

makes it very difficult to establish research-based industries in most developing countries.

Most medical research in these countries takes place in the public sector. The lack of any

means of patenting these inventions and the related lack of experience in licensing them to the

private sector, suppresses the development of commercial enterprises focused on alleviating

the disease burdens common to developing countries.

The controversy over availability of patented therapies for the treatment of HIV disease has

resulted renewed interest in the compulsory licensing of pharmaceutical products. After two

years of discussion, the WTO Council recently affirmed that the TRIPS Agreement permits


30

such compulsory licenses in health emergencies, even in cases where the compulsory license

is for an imported product. However, to date, no compulsory licenses actually have been

issued, even though the threat of compulsory licensing has been used as a means of seeking

lower prices.

One danger in compulsory licensing is that it will discourage further the commercial R & D

necessary to new drugs to fight global epidemics. Another danger is that compulsory licensing

can be used to seek price levels below what a given national market is capable of supporting,

further concentrating the burden of financing pharmaceutical innovation on developed country

consumers and discouraging development of drugs targeted at the disease burdens of

countries using compulsory licenses.

There are promising developments in countries such as India and Brazil that are beginning to

use patents to develop commercial pharmaceutical industries that produce products directed

at local diseases and available at price that patients in those countries can afford. Foundations

and nonprofit organizations such as the Bill and Melinda Gates Foundation and OneWorld

Health, Inc. are supporting such efforts. These efforts show that developing countries have the

capacity to build research-intensive pharmaceutical industries capable of operating profitably

in the conditions of the local market. However, for such local industries to take root and grow,

effective patent protection must be made available, the commercialization of publicly funded

research must be encouraged, and compulsory licensing must be kept to a minimum. Wealthy

countries can assist this process by subsidizing local markets for the purchase of drugs

through the Global Fund, and by direct programs of assistance such as that recently proposed

by President Bush. Consumers in all countries can share the burden of drug development

equitably by paying for medicine at a price level consistent with their means, rather than

attempting to shift the costs of drug development to others.

7. Patents in nanotechnology

Fred JOUTZ, Laura SCHULTZ, October 2009, METHODS FOR IDENTIFYING EMERGING

GENERAL PURPOSE TECHNOLOGIES: A CASE STUDY OF NANOTECHNOLOGIES

http://www.akademiai.com/content/5332413628045051/

Nanotechnology is an emerging field of science with the potential to generate new and

enhance existing products and transform the production process. US patent data is used to

track the emergence of nanotechnologies since 1978. The nanotechnologies that have

undergone the most development are identified using patent citation data and co-citation

patterns of patents are examined to define clusters of related nanotechnologies. The potential

for economic impact of the emerging nanotechnologies is assessed using a generality index.


31

Christopher PALMBERG, Hélène DERNIS, Claire MIGUET, 2009, NANOTECHNOLOGY: AN

OVERVIEW BASED ON INDICATORS AND STATISTICS, OECD Science, Technology and

Industry Working Papers, 2009/7, OECD publishing, © OECD

http://oberon.sourceoecd.org/vl=962727/cl=47/nw=1/rpsv/workingpapers/18151965/wp_5ksf76

8jcsr6.htm

Nanotechnology is commonly considered to offer considerable promise extending from

business opportunities throughout various industries to broader socio-economic benefits,

especially in the context of pressing global challenges such as those related to energy, health

care, clean water and climate change. Governments around the world have invested heavily in

R&D in this field and companies are also becoming increasingly engaged. Despite this

promise, investments and company involvement in nanotechnology developments are still

poorly monitored. The objective of this report is to provide a comprehensive overview of these

developments through a systematic and critical analysis of available indicators and statistics,

while acknowledging that there is a need for further work to both broaden the range of, and

develop further, nanotechnology metrics.

UK INTELLECTUAL PROPERTY OFFICE, April 2009, UK INNOVATION

NANOTECHNOLOGY PATENT LANDSCAPE ANALYSIS

http://www.ipo.gov.uk/informatic-nanotech.pdf

Patent data reflecting UK innovation in the field of nanotechnology was analysed and several

subsets considered separately:

UK innovation commercial organisations

University applicants

Global patent activity in nanotoxicity

These yield the following observations in respect of UK innovation:

UK strong overall in bionanotechnology

Commercial organisations prolific in medical and cosmetic applications

Universities strong in science-base research in nanostructures, physics and

electrical applications including scanning probes, light guides, semiconductors and

magnets

Most prolific commercial patents closely related to densely patented (established)

technology sectors

University patents spread very broadly across all sectors and tend to populate

underrepresented sectors supporting research bias


32

It was noted that whilst recent declines in nanotechnology patenting may be attributable to

patent publication delays, evidence in university patenting, and the GB patent bias in the

dataset suggested that the decline may be actual. If so, nanotechnology patent activity would

seem to have peaked in 2002.

Under technology breakdown, medical preparation including targeted drug delivery and

antibody directed enzyme therapy is seen to decline since prolific activity in the early 1990s.

On the other hand, cyclodextrins and medicinal preparations involving nanoparticles and/or

nanocapsules is recently resurgent. Activity in nanostructures and physics/electrical fields is

ongoing and may be attributable to recent university research pursuing these technologies.

The UK is underrepresented in nanotoxicity, but this appears to be a growth area, peaking

recently in 2005.

Patent portfolio (holdings) analysis suggests, despite the bias of patents in established areas

assigned to commercial organisations, that new entrants and exploratory research still form a

significant part of the UK nanotechnology landscape; 49% of patents are held within portfolios

of less than 20 nanotechnology patents.

Collaborative activity between applicants is noted although inventor collaborations are more

prolific. Universities are seen to collaborate widely suggesting a high degree of technology

transfer and/or spin out.

Patents held by non-commercial organisations make up 33% of the dataset. This suggests a

significant research and development activity-base with continuing commercialisation and

applications development.

EUROPEAN PATENT OFFICE, 2008, NANOTECHNOLOGY IN EUROPEAN PATENTS -

CHALLENGE AND OPPORTUNITY

http://en.acarpatent.com/icerikg.asp?id=1577&smi=

Nanotechnology is considered by many to be one of the key technologies of this century, with

an expected market volume of EUR 1 trillion in 2015. In 2004, about EUR 8 billion was

invested in nanotechnology research and development worldwide. The European

Commission, realising the future importance of this new field, funds nanotechnology projects

with roughly EUR 500 million a year, an amount that is likely to double over the next decade or

two, according to an EC source.

The emergence of nanotechnology (“nano” is derived from the Greek word for dwarf) has been

followed closely by the European Patent Office (EPO).


33

Hsinchun CHEN, Mihail C. ROCO, Xin LI and Yiling LIN, April 2008, TRENDS IN

NANOTECHNOLOGY PATENTS

http://ai.arizona.edu/intranet/papers/NatureNano-April2008.pdf

An analysis of 30 years of data on patent publications from the US Patent and Trademark

Office, the European Patent Office and the Japan Patent Office confirms the dominance of

companies and selected academic institutions from the US, Europe and Japan in the

commercialization of nanotechnology.

Masatsura IGAMI, Teruo OKAZAKI, May 2007, CAPTURING NANOTECHNOLOGY'S

CURRENT STATE OF DEVELOPMENT VIA ANALYSIS OF PATENTS, STI working paper

2007/4, OECD


This analysis aims at capturing current inventive activities in nanotechnologies based on the

analysis of patent applications to the European Patent Office (EPO). The main findings are the

following: Nanotechnology: a set of technologies on the nanometre scale, not a single

technological field

• Nanotechnology is a multifaceted technology. At present, it consists of a set of technologies

on the nanometre scale rather than a single technological field. It covers “Electronics”,

“Optoelectronics”, “Medicine and biotechnology”, “Measurements and manufacturing”,

“Environment and energy”, and “Nano materials”.

• The majority of nanotechnologies, especially nanotechnologies related to “Electronics” and

“Optoelectronics”, are seemingly realised by a top-down process, where nano-structures are

developed through the improvement or advancement of existing technologies. Mutual

interactions among these top-down nanotechnologies appear to be weak, because they are

usually pushing the technological frontier within their own fields. As they build on cumulative

knowledge, top-down nanotechnologies are likely to have social and economic impacts in the

short and medium term.

• Another group of nanotechnologies is developed by a bottom-up process. The development

of such technologies has been particularly intense in the past decade and fuelled by scientific

discoveries such as carbon nanotubes and fullerenes. The increasing importance of

“Measurements and manufacturing” in the development of bottom-up nanotechnology was

also observed. At this stage, bottom-up nanotechnology is likely to have a relatively low impact

on application fields. It will take a while until bottom-up nanotechnologies have social and

economic impacts.


34

• Nanotechnology not only covers a wide range of technologies, but also underpins the

development of many fields. High citations of nanotechnology patent applications are likely to

point to their high technological or economic value.

The recent rise of inventive activities in nanotechnology

• Nanotechnology patent applications to the EPO have been increasing since the 1980s, apart

from a temporary stagnation in the early 1990s. The increase, especially remarkable since the

end of the 1990s, has been higher than the average growth in the total number of EPO

applications.

• The United States, the European Union and Japan have almost the same share in

nanotechnology patent applications to the EPO, with the United States and Japan holding a

relatively higher share compared to their total EPO average.

• Higher education and government sectors are an important source of knowledge in

nanotechnology. Their shares in nanotechnology patent applications are notably larger than in

the EPO average for all patent applications. The contributions of these sectors have become

particularly important since the middle of the 1990s. Because of differences in national

science, technology and innovation systems, the shares of government and higher education

sectors vary across countries. The share of the government sector is the largest in France and

Japan. The higher education sector holds a relatively large share in the United Kingdom, the

United States and the Netherlands. The private non-profit sector holds the largest share in

Germany.

• The current development of nanotechnology relies strongly on countries’ existing

technologies and accumulated scientific knowledge. Japan has the largest share in

“Electronics”, “Optoelectronics”, and “Environment and energy”. The United States holds the

largest share in “Medicine and biotechnology”, “Measurements and manufacturing”, and “Nano

materials”. Countries’ shares in the nanotechnology patent applications in each application

field are strongly correlated with their shares in non-nanotechnology patent applications of the

same fields, except for the European Union. Other countries are increasingly contributing to

nanotechnology inventive activities, especially Korea which holds the fourth largest share in

nanotechnology related to “Electronics”.

Science fuels technological development in diverse ways

• Science fuels nanotechnology in diverse ways. An analysis of citations to non-patent

literature shows the importance of interactions between scientific and inventive activities in

nanotechnology. Three typologies of interactions can be distinguished. First, some inventive

activities are spurred by scientific activities. These technologies show a relatively large share

of non-patent literature in the initial stage of development, e.g. semiconductor devices.

Second, some technologies are continuously fuelled by science, as revealed by their almost


35

constant share of non-patent literature, e.g. drug delivery and applications of titanium dioxide

to sun screening. Finally, there are some technologies for which the linkage between science

and technology becomes important over time, e.g. carbon nanotubes.

• Scientific activities have a crucial role in knowledge creation and flows in nanotechnology.

Measurements of citation time-lags showed a remarkable shortening of the time-lags sparked

by scientific breakthroughs, e.g. the discovery of carbon nanotubes. Citation analysis shows

that the higher education sector produces a relatively high share of frequently cited patent

publications.

ftp://ftp.cordis.europa.eu/pub/indicators/docs/mapex_nano.pdf

8. Patents in environmental technologies

Bronwyn H. Hall, Christian Helmers, March 2011, INNOVATION AND DIFFUSION OF

CLEAN/GREEN TECHNOLOGY: CAN PATENT COMMONS HELP?

http://www.nber.org/papers/w16920

This paper explores the characteristics of 238 patents on 94 “inventions” contributed by major

multinational innovators to the “Eco-Patent Commons”, which provides royalty-free access to

third parties to patented climate change related innovations. By comparing the pledged

patents to other patents in the same technologies or held by the same multinationals, we

investigate the motives of the contributing firms as well as the potential for such commons to

encourage innovation and diffusion of climate change related technologies. This study,

therefore, indirectly provides evidence on the role of patents in the development and diffusion

of green technologies. More generally, the paper sheds light on the performance of hybrid

forms of knowledge management that combine open innovation and patenting.

OECD, June 2009, Working Party on National Environmental Policies, INDICATORS OF

INNOVATION AND TRANSFER IN ENVIRONMENTALLY SOUND TECHNOLOGIES:

METHODOLOGICAL ISSUES

http://www.oecd.org/officialdocuments/displaydocumentpdf/?cote=ENV/EPOC/WPNEP(2009)1

/FINAL&doclanguage=en

This report is a contribution to the OECD Environment Directorate's work on environmental

policy and technological innovation (www.oecd.org/environment/innovation). It summarises

recent progress in the development of indicators of innovation and transfer in environmentally


36

sound technologies (EST). A number of alternative measures are discussed, and the

methodology for the development of indicators based on patent data is presented.

Yamei SUN, Yonglong LU, Tieyu WANGA, Hua MAABAND, Guizhen HE, October 2007,

PATTERN OF PATENT-BASED ENVIRONMENTAL TECHNOLOGY INNOVATION IN CHINA

http://www.sciencedirect.com/science?_ob=ArticleURL&_udi=B6V71-4R0CPN2-

2&_user=10&_rdoc=1&_fmt=&_orig=search&_sort=d&view=c&_acct=C000050221&_version=

1&_urlVersion=0&_userid=10&md5=96e889ecfcdee237345e347fe45ea3b4#vt4

Technology innovation benign to environmental preservation is one of the key strategies to

address sustainable development. Understanding the pattern of environmental technology

innovation in a country is necessary for making policies and decisions in environment

management. Temporal and spatial distribution of environmental patents was analyzed to

identify innovation capability of environmental technologies in China. In terms of features the

patents were classified into invention, utility model (performance improvement) and design.

The patents belonged to the individuals, enterprises and research institutes in terms of

ownership. Through analyzing the pattern of environmental patents by features and

ownership, it was found that individual-owned patents and utility model patents accounted for

the biggest percentage of all the environmental patents applied by the domestic applicants.

Eastern provinces had the majority of environmental patents. The cluster analysis showed that

invention patents and enterprise-owned patents were concentrated in the eastern provinces. In

general, the innovation capability of environmental technologies in the east is strongest among

the regions. Though it had been improved in the last two decades, the percentage of invention

patents was still small and enterprises did not play the most important role in innovation.

Applications of environmental patents increased gradually but had a declining share of all the

patents in the last two decades. The innovation capability of environmental technologies in

China is still not strong on a global perspective.

Marcus WAGNER, 2007, working paper 07-14, THE LINK BETWEEN ENVIRONMENTAL

INNOVATION, PATENTS, AND ENVIRONMENTAL MANAGEMENT


This paper analyses empirically the relationship between environmental innovations,

environmental management and patenting. In particular it tests a number of propositions on

how environmental management systems and the interaction with environmentally more or

less concerned stakeholders are associated with the probability of firms to pursue innovation

in general (measured as patenting behaviour) and specifically environmental innovation

(measured as firm self-assessment and based on patent data). In applying a negative binomial


37

as well as binary discrete choice models the relationship is studied using data on German

manufacturing firms. As a novel and important insight, the study finds that environmental

innovation can be meaningfully identified using patent data and that environmental innovation

defined this way is less ubiquitous than self-reported environmental innovation. It also reveals

that the implementation level of environmental management systems has a positive effect

exclusively on environmental process innovation, whereas it is negatively associated with the

level of a firm’s general patenting activities. For environmental product innovation and

patented environmental innovations a positive relationship with environ-mentally concerned

and a negative link with environmentally neutral stakeholders is found.

Åsa GUILAMO, 2007, JAPANESE POLICY FOR ENVIRONMENTAL INNOVATION AS A

WAY TO REALIZE GROWTH A close-up study on current Japanese measures to nurture and

promote environmental technology

http://www.tillvaxtanalys.se/tua/export/sv/filer/publikationer-arkiv/itps/rapporter/2007/japanese-

policy-for-environmental-innovation-as-a-way-to-realize-growth-07.pdf

The overall aim of this study is to gain an understanding of the current development and

promotion of environmental technology in Japan, including governmental measures and, to

some extent, new initiatives from the private sector. Policies and research strategies are

analyzed from the viewpoint of gaining insight in both the underlying assessments as well as

the main aspirations for the future. Three questions are highlighted: What are the current

development trends in Japan for governmental R&D, research strategies and patent activity

relating to environmental technology? What are the other environmental technology promotion

measures of significance? And, finally, what are the current and what future strengths within

the field of environmental technology can be expected?

The overall purpose, based on an overview of Japanese success factors and future

aspirations, is to learn and gain experiences for potential future efforts in Sweden to foster

prolonged competitive advantages in the environmental technology sector. In this regard, the

relationship between environmental regulations and innovation, as well as the preconditions

for creating lead markets enabling domestic firms to export environmental innovations, are

elaborated upon.

To summarize, new visions in Japan’s third basic Science & Technology plan include a

strengthened focus on biomass & 3R (Reduce, Reuse, Recycle) as well as a more

comprehensive view on climate change issues. Ministries and research institutes are currently

working on how to mirror and realize the visions of the basic plan into their own strategies. The

ministries are highlighting applications of cutting-edge technologies and the need for an Asian

perspective. The research institutes to a large extent mirror biomass and the Asian focus.


38

Other key features of the strategies are the emphasis on relating current undertakings to long-

term visions and the establishment of follow-up indicators, as done in e.g. the Ministry of

Environment’s Strategy on promotion of Environmental Research and Technology

Development.

According to patent data, Japan’s strong competence is currently concentrated to a few key

areas: air pollution control equipment, waste disposal and recycling. Weaker areas are water

pollution and noise protection. Looking into market sizes the following strong areas appear:

Renewable energy plants, Waste treatment and construction, and Instrument for Waste water

treatment. Bringing together these results with conclusions from competitiveness indexes and

(although limited) export statistics, the main fields of Japanese strengths can be sorted out as:

• Air pollution control equipment

• Waste disposal, treatment & management equipment

• Recycling

• Renewable energy plants

There are also high expectations for future success for so-called environment induced

businesses. There are expectations on strong future market growth in following areas:

manufacturing of air pollution control equipment and pollution preventing resources

(photocatalytic system, catalysts, emissions treatment devices etc.), education, training,

information supply (environmental reporting, auditing, consulting for obtaining ISO 14000 etc.),

environmental burden reducing and energy saving technology and processes, and energy

saving and energy management (fuel cell cars, new energy etc).

The Eco-Town concept, in spite of the program’s limited budget, is considered an effective

measure in Japan to promote local economic stimulation through fostering environmental

businesses. The Eco Town Program can, to some extent, be compared to the Local

Investment Programmes (LIP) and Climate Investment Programmes (KLIMP) in Sweden. As in

LIP and KLIMP, local governments/ municipalities are working together with local companies

and organisations. However, the Eco-Town program has had a much stronger focus on 3R-

related activities (Reduce, Reuse, Recycle), compared to the Swedish programs mainly aiming

at reducing the emissions of greenhouse gases. Official development assistance is

increasingly being used by Japanese actors as a tool to promote environmental technology

abroad, mainly in nearby Asia. Another innovative policy measure Japan has applied is the

environmental technology verification, in place as a pilot project since 2003 and planned as a

full-fledged program starting two years from now. The verification has already proven useful

for example to obtain knowledge/know-how for providing guidance and information on

procurement of environmental technologies. And, as developers were able to learn about


39

features and improvements in technology, these were further stimulated, thanks to publicity

from the program.

Reflecting on the Japanese experiences, life cycle analysis (LCA) seems to be an increasingly

important complementary tool to regulations for adjusting the imbalances of today’s price and

cost structures. Since LCA measures are also a part of Swedish environmental policy, the

Japanese experiences as a lead market in this regard may contribute to valuable learning. In

addition to LCA advancements, Japan will provide a favorable ground for development of

environmental innovations on e.g. it’s demographic situation, high degree of competition and

close monitoring activities from other countries; all important so-called demand factors for

national markets to become lead markets.

9. Patents and climate change

Hall, Bronwyn H., Helmers, Christian, 2013, INNOVATION AND DIFFUSION OF

CLEAN/GREEN TECHNOLOGY: CAN PATENT COMMONS HELP?

http://ideas.repec.org/a/eee/jeeman/v66y2013i1p33-51.html

This paper explores the characteristics of 238 patents on 90 inventions contributed by major

multinational innovators to the “Eco-Patent Commons”, which provides royalty-free access to

third parties to patented innovations on green technologies. We compare the pledged patents

to other patents in the same technologies or held by the same multinationals to investigate the

motives of the contributing firms as well as the potential for such commons to encourage

innovation and diffusion of climate change related technologies. We find pledged patents to

protect environmentally friendly technologies and to be of similar value as the average patent

in a pledging firm's patent portfolio but of lower value than other patents in their class. Our

analysis of the impact of the patent commons on diffusion of patented technologies suggests

that making patents accessible royalty-free did not result in any significant increase in diffusion

as measured by citing patents. This study, therefore, indirectly provides evidence on the role

of patents in the development and diffusion of green technologies.


40

Antoine Dechezleprêtre, Matthieu Glachant, Yann Ménière, 2013, WHAT DRIVES THE

INTERNATIONAL TRANSFER OF CLIMATE CHANGE MITIGATION TECHNOLOGIES?

EMPIRICAL EVIDENCE FROM PATENT DATA

http://ideas.repec.org/a/kap/enreec/v54y2013i2p161-178.html

Technology transfer plays a key role in global efforts to reduce greenhouse gas emissions. In

this paper, we characterize the factors that promote or hinder the international diffusion of

climate-friendly technologies using detailed patent data from 96 countries for the period 1995–

2007. The data provide strong evidence that lax Intellectual Property regimes have a strong

and negative impact on the international diffusion of patented knowledge. Restrictions on

international trade and foreign direct investment also hinder the diffusion of climate-friendly

technologies. Surprisingly, local technological capabilities tend to discourage transfers. While

broad indicators of technology capabilities are expected to facilitate transfers, this latter result

stems from our technology-specific definition of local capabilities, which makes it possible to

capture a substitution effect between local and foreign inventions. Copyright Springer

Science+Business Media B.V. 2013

Ghafele, Roya & Gibert, Benjamin, Roya Ghafele, Benjamin Gibert October, 2011, A

CHANGING CLIMATE: STATISTICAL EVIDENCE OF THE INTELLECTUAL PROPERTY

LANDSCAPE OF CLEAN ENERGY TECHNOLOGIES

http://ideas.repec.org/p/pra/mprapa/36217.html

The intellectual property (IP) system plays an important role in the development and diffusion

of technologies by determining the institutional context in which transactions occur. This article

reviews the recent EPO report ‘Patents and Clean Energy Technologies: Bridging the Gap

between Evidence and Policy’ and offers further insights into the interplay between patents,

innovation in climate change mitigating technologies and access to technology. Empirical

evidence and analysis of patent trends forms the basis for understanding the spectrum of

policy choices available to combat climate change. In an effort to bridge the gap between

policy and evidence, the EPO report provides ample statistical analysis of existing patenting

trends, fleshes out the current patent landscape and assesses licensing trends in emerging

technologies relating to climate change. This review evaluates these statistical insights and

discusses the implications for both the developed and developing world. It aims to deepen

understanding of how intellectual property influences the development of markets for green

technologies.


41

Matthieu GLACHANT, Antoine DECHEZLEPRÊTRE and Yann MÉNIÈRE, 2010, WHAT

DRIVES THE INTERNATIONAL TRANSFER OF CLIMATE CHANGE MITIGATION

TECHNOLOGIES? EMPIRICAL EVIDENCE FROM PATENT DATA

http://www.feem.it/userfiles/attach/201021618384NDL2010-012.pdf

Using patent data from 66 countries for the period 1990–2003, we characterize the factors

which promote or hinder the international diffusion of climate-friendly technologies on a global

scale. Regression results show that technology-specific capabilities of the recipient countries

are determinant factors. In contrast, the general level of education is less important. We also

show that restrictions to international trade—e.g., high tariff rates—and lax intellectual property

regimes negatively influence the international diffusion of patented knowledge. A counter-

intuitive result is that barriers to foreign direct investments can promote transfers. We discuss

different possible interpretations.

10. Patents and energy technologies

Mark C SCARSI, Lawrence T KASS & Chris L HOLM, July/August 2009, PATENTS,

LITIGATION & LICENSING EMERGING ISSUES FOR CLEAN ENERGY TECHNOLOGIES

http://www.milbank.com/NR/rdonlyres/A745AF9D-1A44-4C90-B4C8-

A1D5EC679C2A/0/NACE_JulAug09.pdf

WIPO, April 2009, PATENT-BASED TECHNOLOGY ANALYSIS REPORT – ALTERNATIVE

ENERGY

http://www.wipo.int/patentscope/en/technology_focus/pdf/landscape_alternative_energy.pdf

Since the oil crises of the 1970s, the world has increasingly paid attention to the development

and diffusion of alternative energy sources in order to reduce dependency on fossil fuels.

During the oil crises, the primary focus was on increasing selfsufficiency with respect to energy

sources. By the 1990s, environmental concerns had taken the forefront, leading to a new

phase in the development of alternative energies. This new phase coincided with an increase

in the number of patent applications as well as the number of applicants involved in developing

alternative energy technologies, particularly from 2000 onwards, when a rapid acceleration in

patent activity took place. Among the major patent offices at which patent applications for

alternative energy technologies were filed, namely those of the United States, Japan, and

Germany, the distribution of applications among different areas of technology appears to be

related strongly to the countries’ geographic and resource situation as well as the distribution

of research and development budgets and supporting policies. Japan entered the field of


42

alternative energy development early and has seen strong patenting activity from domestic

applicants. Patent applications at the Japan Patent Office (JPO) have focused strongly on

solar power and hydrogen and fuel cell technologies. Patent applications at other patent

offices based on priority applications at the JPO appear to mirror this pattern. Patent

applications at the United States Patent and Trademark Office (USPTO) have been relatively

evenly distributed between domestic and foreign applicants. During the period from 2001 to

2005, the USPTO saw rapid growth both in the number of patent applications and the number

of applicants. The focus of patent applications filed at the USPTO has been primarily on bio

energy, geothermal energy, and hydrogen and fuel cell technologies. The European Patent

Office (EPO) and major European national patent offices have experienced a relatively steady

growth in both the number of patent applications and applicants since the 1990s. Patent

applications at the EPO and European national offices have tended to focus on different areas

of technology, depending on the office. Germany, the national office with the largest number of

applications filed, received patent applications primarily for wind power and solar energy

technologies. In Korea and China, most patent applications were filed by domestic applicants.

Though the initial number of applications filed at the patent offices of these countries was quite

small, the growth rate has been very high. While patenting activity at the Korean Intellectual

Property Office (KIPO) has focused on wind power and hydrogen and fuel cell technologies,

the largest number of applications at the State Intellectual Property Office (SIPO) in China

have been for solar energy and hydropower technologies.

Robert M. MARGOLIS and Daniel M. KAMMEN, July 1999, UNDERINVESTMENT: THE

ENERGY TECHNOLOGY AND R&D POLICY CHALLENGE

http://rael.berkeley.edu/sites/default/files/old-site-files/1999/Margolis-Kammen-Science-

1999.pdf

This Viewpoint examines data on international trends in energy research and development

(R&D) funding, patterns of U.S. energy technology patents and R&D funding, and U.S. R&D

intensities across selected sectors. The data present a disturbing picture: (i) Energy

technology funding levels have declined significantly during the past two decades throughout

the industrial world; (ii) U.S. R&D spending and patents, both overall and in the energy sector,

have been highly correlated during the past two decades; and (iii) the R&D intensity of the

U.S. energy sector is extremely low. It is argued that recent cutbacks in energy R&D are likely

to reduce the capacity of the energy sector to innovate. The trends are particularly troubling

given the need for increased international capacity to respond to emerging risks such as global

climate change.


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David POPP, August 1998, THE EFFECT OF NEW TECHNOLOGY ON ENERGY

CONSUMPTION

http://www2.ku.edu/~kuwpaper/Archive/papers/Pre1999/wp1998_5.pdf

This paper uses patent data to estimate the effect of new technologies on energy

consumption. A stock of energy knowledge is created for each of 13 energy-intensive

industries. The median present value of long run savings from a new patent is nearly 9 million

dollars. The results are used to simulate the effect of a ten-percent energy tax. Although factor

substitution is found to play a greater role than induced innovation in the short run, the energy

savings from induced innovation play a much larger role than factor substitution in the long

run, due to the cumulative nature of research.

Clean Energy Patent Growth Index Presented by the Cleantech Group- Heslin Rothenberg

Farley & Mesiti P.C.

The CLEAN ENERGY PATENT GROWTH INDEX (CEPGI), published quarterly by the

CLEANTECH GROUP at Heslin Rothenberg Farley & Mesiti P.C, provides an indication of the

trend of innovative activity in the Clean Energy sector.

GREEN PATENT BLOG® covering intellectual property issues in clean technology

Eric Lane is a patent attorney at Luce, Forward, Hamilton & Scripps in San Diego, where he is

in the Intellectual Property and Climate Change & Clean Technologies practice groups.

11. Patents and eco-innovations/environment

Matthieu GLACHANT, Antoine DECHEZLEPRETE, Ivan HASCIC, Nick JOHNSSTONE &

Yann MENIERE, 2009. "INVENTION AND TRANSFER OF CLIMATE CHANGE MITIGATION

TECHNOLOGIES ON A GLOBAL SCALE," Working Papers 2009.82, Fondazione Eni Enrico

Mattei.

http://www.feem.it/userfiles/attach/2009111910454482-09.pdf

Accelerating the development of less GHG intensive technologies and promoting their global

diffusion - in particular in fast-growing emerging economies - is imperative in achieving the

transition to a low-carbon economy. Consequently, technology is at the core of current

discussions about the post-Kyoto regime. The purpose of this study is to fuel this discussion

by providing an in-depth analysis of the geographic distribution of climate mitigation inventions

since 1978 and their international diffusion on a global scale. We use the EPO/OECD World

Patent Statistical Database (PATSTAT) which includes patents from 81 national and

international patent offices. Note that the Least Developed Countries patent a negligible


44

number of inventions, meaning that the geographical scope of the study is limited to

industrialized countries and emerging economies. In this study, patent counts are used to

measure the output of innovation but also the transfer of inventions across borders on the

ground that an innovator patents his/her invention in a foreign country because he/she plans to

exploit it commercially there. They are the only indicator available today that provides a

comprehensive view on innovation and technology diffusion on a global scale. Patent data

also present drawbacks. First, patents are not the only tool available to inventors to protect

their inventions. Second, successful technology transfers also involve the transfer of know-

how. Still one can reasonably assume that patent counts are positively correlated to the

quantity of non-patented innovations and transfers. We consider 13 different classes of

technologies with significant global GHG emission abatement potentials, and analyze inventive

activities and international technology transfer between 1978 and 2003. The technologies

considered are seven renewable energy technologies (wind, solar, geothermal, ocean energy,

biomass, waste-to-energy, and hydropower), methane destruction, climate-friendly cement,

energy conservation in buildings, motor vehicle fuel injection, energy-efficient lighting and

Carbon Capture & Storage (CCS).

Impact of the Kyoto Protocol

Statistics suggest that the Protocol has induced more innovation in the recent period. While

innovation in climate change technologies and innovation in all technologies were growing at

the same pace until the mid-nineties, the former is now developing much faster. Between 1998

and 2003, innovation in climate mitigation technologies has been growing at the average

annual rate of 9%. This increase has taken place in Annex 1 countries which have ratified the

Kyoto Protocol but not in Australia and in the USA.

In contrast, there is no visible effect of the Kyoto protocol on technology transfer: international

technology flows have been increasing in the recent period, but the growth rate is the same as

the average.

Main inventor countries

Innovation in climate change technologies is highly concentrated in three countries—Japan,

Germany and the USA—which account for two thirds of total innovations in the thirteen

technologies. The performance of Japan is particularly impressive as it ranks first in twelve

technology fields out of 13. In average it accounts for 40 percent of worldwide innovation.

Surprisingly, the innovation performance of emerging economies is far from being negligible as

China, South Korea and Russia are respectively the fourth, fifth and sixth largest innovators.

They globally represent about 15% of total inventions.

International technology diffusion


45

Do these new technologies cross national borders? The export rate—measured by the share

of inventions that are patented in at least two countries—is around 25%. This sounds small,

but it is only a few percent below the rate for all technologies. International transfers mostly

occur between developed countries (75% of exported inventions). Exports from developed

countries to emerging economies are still limited (18%) but are growing rapidly. This suggests

a huge potential for the development of North-South transfers. Although China, Russia and

South Korea are major innovators, flows between emerging economies are almost non-

existent. Accordingly, there also exists a huge potential for South-South exchanges—

particularly given that these countries may have developed technologies that are better

tailored to the needs of developing countries.

Timothy FOXON, Maj MUNCH ANDERSEN, June 2009, THE GREENING OF INNOVATION

SYSTEMS FOR ECO-INNOVATION – TOWARDS AN EVOLUTIONARY CLIMATE

MITIGATION POLICY


Policies for mitigating climate change have never received as much attention worldwide as

now. At the same time another upcoming policy trend is the increasing synthesis between

innovation- and environmental policy, a synthesis that is captured by the eco-innovation

concept. However, the climate and innovation policy areas are currently little aligned and have

in fact been considered opposites until very recently.

The paper seeks to identify how evolutionary economic theory, hitherto very little applied to the

environmental area, may guide the development of climate policies and eco-innovation

policies in important ways. The paper argues that the evolutionary economic perspective

entails a new policy rationale which not only puts more emphasis on greening of markets as a

means towards reaching climate goals but also shifts the representation of the economy

towards a more dynamic one. The policy implications of this shift are considerable and have

hitherto gained little attention.

A deeper understanding of eco-innovation dynamics is strongly needed for informing both

climate and innovation policies. The paper argues that the fact that environmental problems

have largely been neglected by evolutionary economic research illustrates a lack of genuine

systems thinking within this line of thought, despite the prominence of systems ideas. The

paper proposes a strong paradigmatic explanation of eco-innovation based on a combination

of innovation systems thinking and an evolutionary capabilities approach.


46

Vanessa OLTRA, René KEMP, Frans P. de VRIES, April 2009, PATENTS AS A MEASURE

FOR ECO-INNOVATION

http://www.dime-eu.org/wp25

This paper examines the usefulness of patent analysis for measuring eco-innovation. The

overall conclusion is that patents are a useful means for measuring environmentally motivated

innovations, such as pollution control technologies and green energy technologies, and for

general purpose technologies with environmental benefits.

For these types of innovations it is acceptable to use patent analysis, provided they are

carefully screened. Patent analysis may be used for measuring five attributes of

ecoinnovation: (1) eco-inventive activities in specific technology fields, (2) international

technological diffusion, (3) research and technical capabilities of companies, (4) institutional

knowledge sources of eco-innovation, and (5) technological spillovers and knowledge flows.

Up until now it is mainly used for measuring eco-inventive activity.

Anthony ARUNDEL and René KEMP, with contributions from Tomoo MACHIBA and Nick

JOHNSTONE of the OECD, 2009, MEASURING ECO-INNOVATION

http://www.merit.unu.edu/

In this paper we offer a discussion of eco-innovation and methods for measuring it. Eco-

innovation is a new concept of great importance to business and policy makers, covering

many innovations of environmental benefit. Past research and measurement activity primarily

focused on pollution control and abatement activities or on the environmental goods and

services sector. We argue that eco-innovation research and data collection should not be

limited to such environmentally motivated innovations, but should encompass all products,

processes, or organizational innovations with environmental benefits. Attention should be

broadened to include innovation in or oriented towards resource use, energy efficiency,

greenhouse gas reduction, waste minimization, reuse and recycling, new materials (for

example nanotechnology-based) and eco-design. Research should cover the drivers, patterns,

and benefits of eco-innovation for each of these applications, since these factors are likely to

differ. For measuring eco-innovation, no single method or indicator is likely to be sufficient. In

general, one should therefore apply different methods for analyzing eco-innovation – to see

the “whole elephant” instead of just a part. More effort should be devoted towards direct

measurement of eco-innovation outputs using documentary and digital sources to complement

the current emphasis on innovation inputs such as R&D or patents. Innovation can also be

measured indirectly from changes in resource efficiency and productivity. These two avenues

are underexplored and should be given more attention in order to augment our rather narrow

knowledge basis.


47

Tomoo MACHIBA, OECD DSTI, December 2008, PROMOTING ECO-INNOVATION FOR

GREEN ECONOMY AN OVERVIEW OF THE OECD PROJECT ON SUSTAINABLE

MANUFACTURING & ECO-INNOVATION

http://www.oecd.org/department/0,3355,en_2649_34273_1_1_1_1_1,00.html


Alasdair REID, Michal MIEDZINSKI, May 2008, SECTORAL INNOVATION WATCH IN

EUROPE ECO-INNOVATION, FINAL REPORT

http://www.europe-innova.org/

Detailed insights into sectoral innovation performance are essential for the development of

effective innovation policy at regional, national and European levels. The Sectoral Innovation

Watch project provides policy-makers and stakeholders with a better understanding of sectoral

drivers, barriers and challenges for innovation across the EU.

A fundamental question is to what extent and why innovation performance differs across

sectors. The project develops new indicators and innovation models at sectoral level, performs

statistical analysis and studies qualitative aspects.

Sharing eco-friendly patents on global basis (see

http://ec.europa.eu/environment/etap/index_en.htm )

Global businesses are set to share patents with other companies to reduce environmental

impacts. This will help develop products, processes and services protecting the environment.

Eco-Patent Commons is sharing patents to encourage researchers, entrepreneurs and

companies of all sizes in any industry to create, apply and further develop their consumer or

industrial products, processes and services in a way that will help protect and respect the

environment. This effort was initiated by the World Business Council for Sustainable

Development (WBCSD, www.wbscd.org) and IBM, in partnership with Nokia, Pitney Bowes

and Sony. The patent portfolio is available on a public website (http://www.wbcsd.org/web/epc)

hosted by the WBCSD. It focuses on environmental matters and innovations in manufacturing

or business processes where the solution provides an environmental benefit such as reducing

hazardous waste generation, energy use or water consumption.

Environmental benefits expected include:

· Energy conservation or improved energy or fuel efficiency;

· Pollution prevention;

· Use of environmentally preferable materials or substances;


48

· Reduction of water or materials use; and

· Increased recycling opportunities.

Membership open to all

Membership in the Eco-Patent Commons is open to all individuals and companies pledging

one or more patents. The founding companies and the WBCSD are inviting other interested

companies to become members and participate in this initiative promoting innovation and

collaboration to help protect the planet. “Innovation to address environmental issues requires

the application of technology as well as new models for sharing intellectual property among

companies in different industries,” says Dr John E. Kelly III, director of IBM Research. “In

addition to enabling new players to engage in protecting the environment, the free exchange of

valuable intellectual property will accelerate work on the next level of environmental

challenges. We strongly urge other companies to contribute to the Eco-Patent Commons.”

“Environmental issues have great potential to help us discover the next wave of innovation

because they force us all to think differently about how we make, consume and recycle

products,” adds Donal O’Connell, Director of Intellectual Property, Nokia. “We have pledged a

patent designed to help companies safely re-use old mobile phones by transforming them into

new products. Recycling the computing power of mobile phones in this way could significantly

increase reuse of materials in the electronics industry.”

More information:

The Eco-Patent Commons: A leadership opportunity for global business to protect the planet

(http://www.wbcsd.org/DocRoot/QdMK547NiducgYLJhvSL/Eco-

Patent%20Commons%20Brochure_011008.pdf )

René KEMP (project leader), June 2008, Final Report “MEASURING ECO-INNOVATION

(MEI)”

http://www.merit.unu.edu/MEI/papers/Final%20report%20MEI%20project%20June%203%202

008.pdf

René KEMP (project leader), June 2008, Policy Brief “MEASURING ECO-INNOVATION

(MEI)”

http://www.merit.unu.edu/MEI/papers/Policy%20Brief%20MEI%20June%202008.pdf

MEI is a project for DG Research of the European Commission (Call FP6-2005-SSP-5A, Area

B, 1.6, Task 1). The project has been carried out in collaboration with Eurostat, the European

Environment Agency (EEA) and the Joint Research Center (JRC) of the European

Commission. MEI offers a conceptual clarification of eco-innovation (developing a typology)

and discusses possible indicators, leading to proposals for eco-innovation measurement.


49

Objectives

• To offer a conceptual clarification of eco-innovation (developing a typology) based on an

understanding of innovation dynamics.

• To identify and discuss the main methodological challenges in developing indicators and

statistics on eco-innovation and to explore how they may be overcome.

• To propose possible indicators for measuring relevant aspects of eco-innovation, taking into

account data availability issues; and to define future research needs for addressing these

methodological challenges in developing eco-innovation indicators; and to set up guidance for

the most feasible route for implementation of eco-innovation indicators on the time scale

envisaged.

12. Patents and software

Ahmed DRIOUCHI, Molk KADIRI and Moulay Abdelaziz ALAOUI BELGHITI, March 2010,

DIGITAL RIGHTS MANAGEMENT, INTELLECTUAL PROPERTY RIGHTS PROTECTION

AND ECONOMIC DEVELOPMENT: THE CASE OF DIGITAL PIRACY IN THE SOUTH

MEDITERRANEAN COUNTRIES. (Unpublished)

http://mpra.ub.uni-muenchen.de/21609/1/MPRA_paper_21609.pdf

The potential benefits that could be gained from information technologies in South

Mediterranean economies are constrained by both DRM and institutional protection related to

Intellectual Property Rights. But, pervasive piracy can appear to be a major obstacle to access

these benefits. This paper through a simplified theoretical decision model attempts to suggest

foundations to reveal levels of protection rates. This is followed by an empirical assessment of

the likely effects of different macroeconomic variables in the context of selected South

Mediterranean countries using software piracy data and the protection rates derived from the

above model. This is intended to reveal the most important variables that drive software

protection. The results attained show how protection should be strengthened through further

investments in knowledge and through openness to foreign direct investments that lead to

superior economic outcomes.

Birgitte ANDERSEN, Ainurul ROSLI, Federica ROSSI, Waraporn YANGSAP, August 2009,

PROPRIETARY AND NON-PROPRIETARY INTELLECTUAL PROPERTY MARKETPLACES:

THEIR FUNCTIONING AND EFFICIENCY AS EXPERIENCED BY UK SOFTWARE FIRMS

http://www.dime-eu.org/files/active/0/WP89-v2-IPR.pdf

By exploring the patterns of engagement in several intellectual property (IP) marketplaces on

the part of a sample of software firms based in the UK, the article attempts to shed light on the


50

strategic reasons which induce firms to participate in different IP marketplaces and

governance structures, often at the same time.

The scope of the analysis includes not only the conventional proprietary marketplaces (patents

and copyright) but also non-proprietary marketplaces (open source and trade in non-patented

technology). Marketplaces are viewed as institutions that allow firms to realize strategic value

but which, due to institutional inefficiencies, may fail to deliver firms the benefits they seek.

Therefore, the obstacles that prevent IP marketplaces from functioning smoothly and efficiently

are also investigated.

The analysis suggests that different marketplaces and governance forms contribute to the

realization of specific forms of value for firms, and suffer from specific failures. In-depth

investigation and comparison of IP marketplaces and governance forms is therefore a

promising and useful area for policy-relevant research.

James BESSEN, 2006, A COMMENT ON “DO PATENTS FACILITATE FINANCING IN THE

SOFTWARE INDUSTRY?”

http://www.researchoninnovation.org/comment%20on%20Mann.pdf

“Do Patents Facilitate Financing in the Software Industry?” by Ronald J. Mann contributes

empirical evidence to our understanding of how software startups use patents. However, a

close examination of the actual empirical findings in this paper points to rather different

conclusions than those that Mann draws, namely: few software startups benefits from software

patents and patents are not widely used by software firms to obtain venture financing. Indeed,

among other things, the paper reports that 80% of venture-financed software startups had not

acquired any patents within four years of receiving financing.

James BESSEN, Robert M. HUNT, 2004, AN EMPIRICAL LOOK AT SOFTWARE PATENTS

http://www.philadelphiafed.org/research-and-data/publications/working-papers/2003/wp03-

17.pdf

U.S. legal changes have made it easier to obtain patents on inventions that use software.

Software patents have grown rapidly and now comprise 15 percent of all patents. They are

acquired primarily by large manufacturing firms in industries known for strategic patenting; only

5 percent belong to software publishers. The very large increase in software patent propensity

over time is not adequately explained by changes in R&D investments, employment of

computer programmers, or productivity growth. The residual increase in patent propensity is

consistent with a sizeable rise in the cost effectiveness of software patents during the 1990s.

We find evidence that software patents substitute for R&D at the firm level; they are


51

associated with lower R&D intensity. This result occurs primarily in industries known for

strategic patenting and is difficult to reconcile with the traditional incentive theory of patents.

13. Patent value

Nicolas van Zeebroeck, Bruno van Pottelsberghe de la Potterie, THE VULNERABILITY OF

PATENT VALUE DETERMINANTS

http://ideas.repec.org/a/taf/ecinnt/v20y2011i3p283-308.html

This paper presents a critical survey of the literature on the determinants of patent value. The

contributions to the literature are essentially two-fold. First, significant inconsistencies across

existing studies are underlined. Second, a sensitivity analysis shows strong dependencies of

several 'classical' results on two main empirical dimensions, namely the choice of the

dependent variables (indicator of patent value) and the sampling methodology. The new

indicators of filing strategies put forward by van Zeebroeck and van Pottelsberghe de la

Potterie (this journal) turn out to be the most robust and stable determinants.

Philipp G. Sandner, Joern Block, January 2011, THE MARKET VALUE OF R&D, PATENTS

AND TRADEMARKS


This paper investigates the effects of trademarks on the market value of firms. The results

show that trademarks have a positive effect on firm value. Next, the firms’ market values are

regressed on indicators of trademark value such as trademark seniorities, the number of

oppositions filed, and the number of product and services classes covered. We found that they

at least partially reflect trademark value.

Alessandro NUVOLARI, Valentina TARTARI, March 2009, MR. WOODCROFT AND THE

VALUE OF ENGLISH PATENTS, 1617-1841


We examine the potentialities of a new indicator for measuring the value of English patents in

the period 1617-1841. The indicator is based on the relative visibility of each individual patent

in the contemporary technical and legal literature as summarized in Bennet Woodcroft's

Reference Index of Patents of Invention. We conclude that the indicator provides a reasonable

proxy for the value of patents and that it can be usefully employed to shed light on the timing

and nature of innovation during the Industrial Revolution. In particular, our indicator offers a


52

suitable reconciliation between the patent records evidence and the Crafts-Harley view of the

Industrial Revolution.

Nicolas VAN ZEEBROECK, May 2008, THE PUZZLE OF PATENT VALUE INDICATORS

http://ideas.repec.org/p/sol/wpaper/07-023.html

This paper reviews and analyses several issues in the measurement and interpretation of

patent value indicators over a large database. Each of the five most classical indicators

proposed in the literature (family sizes, renewals, grant decision outcomes, forward citations,

and oppositions) witnesses the well-known properties of patent value: a severe skewness and

significant country and technology variations. Nonetheless, a high degree of orthogonality

appears between them as well as opposite trends in their evolution, suggesting that they

actually capture different dimensions of a patent’s value and therefore do not always pinpoint

the same patents as being the most valuable. To maximize the chances of capturing all

potentially valuable patents in a large database, a composite index is proposed, which reflects

the intensity of the patent value signal provided by all five constituting indicators. Its declining

trend reflects a rarefaction of this signal on average, leading to different plausible

interpretations.

James BESSEN, November 2007, ESTIMATES OF PATENT RENTS FROM FIRM MARKET

VALUE


The value of patent rents is an important quantity for policy analysis. However, estimates in

the literature based on patent renewals might be understated. Market value regressions could

provide validation, but they have not had clear theoretical foundations for estimating patent

rents. I develop a simple model to make upper bound estimates of patent rents using

regressions on Tobin’s Q. I test this on a sample of US firms and find it robust to a variety of

considerations. My estimates correspond well with estimates based on patentee behavior

outside the pharmaceutical industry, but renewal estimates might be understated for

pharmaceuticals.

Bronwyn H. HALL, Grid THOMA, Salvatore TORRISI, September 2007, THE MARKET

VALUE OF PATENTS AND R&D: EVIDENCE FROM EUROPEAN FIRMS, NBER Working

Paper No. 13426


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


53

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.

Mark A. LEMLEY, Nathan MYHRVOLD, August 2007, HOW TO MAKE A PATENT MARKET


Imagine a stock market in which buyers and sellers couldn't find out the prices at which

anyone else sold a share of stock. If you wanted to buy (or sell) a share of stock, you'd have to

guess what it was worth. The result, everyone would agree, would be massively inefficient.

Willing buyers and sellers would often miss each other. Patents, however, exist in just such a

blind market. Want to know if you're getting a good deal on a patent license, or acquiring rights

in a technology? Too bad. Even if that patent or ones like it have been licensed dozens of

times before, the terms of those licenses, including the price itself, will almost invariably be

confidential. Patent owners who want to put their rights up for sale face the same problem.

The result? Willing licensors and licensees can't find each other. Patent auctions often fizzle,

because without a thick market - one with an array of buyers and sellers bidding on price - no

one can know whether they are getting a steal or being had. When parties do license patents,

the prices are (to the extent we can tell) all over the map. And the rest of the world has no idea

what those prices are. This in turn means that courts lack adequate benchmarks to determine

a “reasonable royalty” when companies infringe patents.

The solution is straightforward: require publication of patent assignment and license terms.

Doing so won't magically make the market for patents work like a stock exchange; there will

still be significant uncertainty about whether a patent is valid and what it covers. But it will

permit the aggregate record of what companies pay for rights to signal what particular patents

are worth and how strong they are, just as derivative financial instruments allow markets to

evaluate and price other forms of risk. It will help rationalize patent transactions, turning them


54

from secret, one-off negotiations into a real, working market for patents. And by making it clear

to courts and the world at large what the normal price is for patent rights, it will make it that

much harder for a few unscrupulous patent owners to hold up legitimate innovators, and for

established companies to systematically infringe the rights of others.

James BESSEN, 2006, THE VALUE OF U.S. PATENTS BY OWNER AND PATENT

CHARACTERISTICS


This paper uses renewal data to estimate the value of U.S. patents, controlling for patent and

owner characteristics. Estimates of U.S. patent value are substantially larger than estimates

for European patents, however, the ratio of U.S. patent value to R&D for firms is only about

3%. Patents issued to small patentees are much less valuable than those issued to large

corporations, perhaps reflecting imperfect markets for technology. Litigated patents are more

valuable, as are highly cited patents. However, patent citations explain little variance in value,

suggesting limits to their use as a measure of patent quality.

Elefthérios SAPSALIS, Bruno VAN POTTELSBERGHE DE LA POTTERIE, Ran NAVON,

Research Policy June 2006, ACADEMIC VS. INDUSTRY PATENTING: AN IN-DEPTH

ANALYSIS OF WHAT DETERMINES PATENT VALUE

http://www.sciencedirect.com/science/article/pii/S0048733306001612

This paper compares corporate and academic patents and tests whether they have similar

value distributions and share common determinants of value. The empirical results based on

an in-depth analysis of 400 biotech patents applied for by Belgian universities and firms lead to

the following observations: (i) academic and corporate patent value distributions have similar

levels of ‘skewness’; (ii) the identification of the institutional origin of knowledge allows for an

improved understanding of the value determinants and (iii) there is a need to focus on

researchers with a high scientific profile in order to crystallize their tacit knowledge into high

value patents.

Alfonso GAMBARDELLA, Paola GIURI, Alessandra LUZZI, February 2006, THE MARKET

FOR PATENTS IN EUROPE


By using the PatVal-EU dataset we find that the most important determinant of patent licensing

is firm size. Patent breadth, value, protection, and other factors suggested by the literature

also have an impact, but not as important. In addition, most of these factors affect the

willingness to license, but not whether a license actually takes place.


55

We discuss why this suggests that there are transaction costs in the markets for technology.

The issue is important because many potential licenses are not licensed suggesting that the

markets for technology can be larger, with implied economic benefits.

Shigeki KAMIYAMA, Jerry SHEEHAN, Catalina MARTINEZ, OECD, 2006, DSTI/DOC(2006)5

VALUATION AND EXPLOITATION OF INTELLECTUAL PROPERTY

http://www.oecd.org/sti/working-papers

As firms shift to more open models of innovation based on collaboration and external sourcing

of knowledge, they are exploiting their intellectual property, notably patents, not only by

incorporating protected inventions into new products, processes and services, but also by

licensing them to other firms or public research organisations (PROs), using them as

bargaining chips in negotiations with other firms, and as a means of attracting external

financing from banks, venture capitalists and other sources.

These developments raise the importance of efficient technology markets and effective IP

valuation schemes. Efficient technology markets can improve innovation processes by

facilitating exchanges of patented inventions (via sale or licensing) among private and public

sector actors that can put inventions in the hands of those most able to commercialise them.

Improved valuation can facilitate not only technology transfer, but a full range of channels for

exploiting IP such as decision to file a patent and investment in firms which hold patents.

This paper reviews recent evidence and analyses about the current status of valuation and

exploitation of patents, with the aim of informing development of related policy. First, it

examines the broadening set of channels through which firms aim to exploit their IP. It

complements this firm-level perspective with a review of macroeconomic statistics related to

the development of technology markets in major geographic regions. Second, the paper

reviews various approaches to the valuation of patents. Finally, the paper examines the range

of policy initiatives that have been undertaken by governments of OECD countries to foster

and improve the valuation and the exploitation of patents.

J. Timothy CROMLEY, November 2004, 20 STEPS FOR PRICING A PATENT - TO VALUE

AN INVENTION YOU HAVE TO UNDERSTAND IT

http://www.journalofaccountancy.com/Issues/2004/Nov/20StepsForPricingAPatent.htm

Ian COCKBURN, ASSESSING THE VALUE OF A PATENT: THINGS TO BEAR IN MIND

(WIPO)

http://www.wipo.int/sme/en/documents/valuing_patents.htm


56

One truism that is often quoted is that, “if it is worth copying, it is worth protecting”. This simple

piece of homespun philosophy is one of the first questions that any inventor or innovator

should ask. If the answer that returns is a bleak NO, then the matter can be laid to rest and

greener pastures explored. More often than not though, the answer is an emphatic YES!

Further questions then arise such as how much will it cost? And what sort of return can I

expect on my efforts, that is, how much is my patent worth?

This article attempts to provide an answer to the latter question and is written to encourage

start-up companies to look seriously at the value of their innovations and to consider ways that

will make the most of their intellectual and capital investment. The article focuses mainly on

patents. For answers relating to the costs involved in gaining patent protection, consult an

intellectual property (IP) professional in the relevant jurisdiction.

Patents are only one of many kinds of Intellectual Property Rights (IPRs) and are granted for

new products or for new processes for making known products better. They give the owner an

exclusive right to exploit those new products or processes for a maximum of 20 years. They

are, therefore, acknowledged as a powerful commercial tool and an important link between

Research & development and the marketplace.

But patents are much more than just that, and can be used to identify and develop new

brands, to maintain present markets or create new ones. They can be used to raise

development finance and can also be used to generate new income streams through

licensing, or to create a business presence in countries without incurring a large expenditure

on bricks and mortar entities of your own. When used wisely, patents may even be the

difference between a company’s success and its failure.

THE VALUE OF EUROPEAN PATENTS EVIDENCE FROM A SURVEY OF EUROPEAN

INVENTORS FINAL REPORT OF THE PATVAL EU PROJECT

http://ec.europa.eu/internal_market/indprop/docs/patent/studies/patentstudy-report_en.pdf

The full scale PatVal-EU survey was conducted from May 2003 to January 2004, and was

directed to the inventors of 27,531 patents granted at the EPO with priority date in 1993-1997

located in France, Germany, Italy, the Netherlands, Spain and the United Kingdom. The

targeted number of patents for which we expected the inventors to respond was 10,000. In the

end the European inventors responded to 9,216 questionnaires covering 9,017 patents.

The distribution of the surveyed patents across countries is the following: 3,346 patents are

invented in Germany, 1,486 in France, 1,542 in the UK, 1,250 in Italy, 1,124 in the

Netherlands, and 269 in Spain. The number of patents surveyed in each country mirrors the

relative size of the country population.


57

Gilles KOLEDA, February 2003, LA VALEUR DE LA PROTECTION DES BREVETS

FRANÇAIS APPRECIEE PAR LEURS RENOUVELLEMENTS

http://alize.finances.gouv.fr/prevision/revue/resumes/ep168/pdf/rsf168a6.pdf

In this article, we compute the value of patent protection for patents applied at the French

Patent Office (INPI), using renewal patent data and values of renewal fees having to be paid to

maintained patents in vigour, on the 1951-2000 period. Simulations of patent protection value,

based on our econometric estimations for the 1951-1993 period, demonstrate that average

patent value have continuously and sharply increased during this period and that patent value

distribution function is strongly asymmetric. Interpreting this increase of the patent protection

average value as an evidence of the quality elevation of innovations protected by patents, we

explain an important fraction of the patents-to-R&D ratio decrease by a focus of R&D on more

valuable objectives.

Mark SCHANKERMAN and Ariel PAKES, 1986, ESTIMATES OF THE VALUE OF PATENT

RIGHTS IN EUROPEAN COUNTRIES DURING THE POST-1950 PERIOD, The economic

journal, 96 (384), pp. 1052-1076, ISSN 1468-0297

http://www.blackwellpublishing.com/journals/ecoj

The principal objectives of this paper are to estimate and analyse the private value of patent

rights in the United Kingdom, France and Germany during the post-1950 period, and to

provide and consider some implications of an index of the `quality' (or average private value)

of patents. Since patent rights are seldom marketed, their private value is in general

unobserved. This paper makes inferences on the value of patent rights from the economic

responses of patentees. In most countries patentees must pay an annual renewal fee in order

to keep their patents in force. If it is assumed that agents make renewal decisions based on

the value of the patent right obtained by renewal, then data on patent renewals and renewal

fee schedules contain information on the distribution of the value of patent rights. In Section I

we outline a simple economic model of patent renewal decisions which, when combined with

the renewal data, allows us to estimate the distribution of the private value of patent protection.

Section II describes the data set and provides some simple nonparametric evidence on shifts

in the patent value distribution over time. In Section III we parameterise the model, and then

present and discuss the estimates. This includes some discussion of the empirical correlates

of intertemporal changes in the value distribution. Section IV derives estimates of the quantiles

of the distribution of the value of patent rights, and compares our results to information on both

the distribution of the value of patented ideas and on the resource cost of producing them.

Section V considers some implications of our results for the distinction between measures of

the quantity and the value of patents. The results indicate that the average value of patents


58

varies across countries. We also use the estimates to examine the relationship between the

decline in patenting activity since the late 1960s, the simultaneous fall in patents per unit of

inventive output.

14. Patent licensing

Mario BENASSI, Daniela CORSARO, Guido GEENEN, January 2010, ARE PATENT

BROKERS A POSSIBLE FIRST BEST?

http://ideas.repec.org/p/mil/wpdepa/2010-11.html

Licensing and reassignment of patents occur either directly or with the assistance of a patent

broker. Building forth on previous research on the topic, we investigate under which conditions

patent brokers can be a first best. First, we discuss structural reasons that can make patent

brokers a preferable option in extracting value from patents. Second, we argue that patent

brokers do have specific competences that make their presence necessary. By discussing

most relevant managerial theories, we formulate specific hypotheses to be tested empirically.

We also offer thoughts on a possible research design as to investigate patent brokers.

Ming-Chung CHANG, January 2010, INSIDER PATENT HOLDER LICENSING IN AN

OLIGOPOLY MARKET WITH DIFFERENT COST STRUCTURES: FIXED-FEE, ROYALTY,

AND AUCTION, Economics Bulletin, Vol. 30 no.1 pp. 20-31.

http://www.accessecon.com/Pubs/EB/2010/Volume30/EB-10-V30-I1-P3.pdf

The issue of the optimal licensing contract in firms having different cost structures is studied

when the innovator is a producing patent holder who has three alternative licensing strategies,

namely, the fixed-fee, royalty rate, and auction strategies. We conclude that the auction

licensing strategy is not the best strategy when the innovator is a producing patent holder. This

finding differs from that of Kabiraj (2004) where the auction licensing method is the optimal

licensing strategy when the innovator is a non-producing patent holder. However, when we

only compare two of the licensing methods, namely, the fixed-fee licensing method and the

royalty licensing method, we conclude that if the inside innovator licenses to only some of the

firms, then the royalty licensing method will be the best strategy. This result is different from

that of Fosfuri and Roca (2004), who concluded that if only some of the licensees obtain a

licensing contract, then the fixed-fee licensing method will be the best choice for a producing

patent holder.


59

Maria Isabella LEONE, Toke REICHSTEIN, Paolo BOCCARDELLI, Mats MAGNUSSON,

2010, FUEL ON THE INVENTION FUNNEL: TECHNOLOGY LICENSING-IN,

ANTECEDENTS AND INVENTION, Working Paper no. 10-13, ISBN: 978-87-7873-295-8

http://www3.druid.dk/wp/20100013.pdf

In this paper, we examine the impact of technology licensing-in on firm invention performance.

Studying a sample of 266 licensees and matched non-licensees using a two-part model

specification, we find that licensees are more likely to introduce inventions than their non-

licensee counterparts. This holds both if we consider invention in general, and invention in the

licensed technological class only. We also show that familiarity with the licensed technology

and technological specialization drives licensees to pursue a narrow invention strategy

primarily focusing on the technological class specified in the license agreement.

Annamaria CONTI, Patrick GAULÉ, January 2010, IS THE US OUTPERFORMING EUROPE

IN UNIVERSITY TECHNOLOGY LICENSING? A NEW PERSPECTIVE ON THE EUROPEAN

PARADOX, Working Paper no. 10-04, ISBN 978- 87-7873-286-6


Europe is perceived to be lagging behind the US in converting its academic results into

economic outcomes. Using new survey data on European and US Technology Transfer

Offices (TTOs), we find that differences in academic research, TTO staff and experience

explain to a great extent the gap between the US and Europe in terms of the number of

license agreements concluded. However, these factors account for only part of the difference

in license income. We relate the difference in licensing income to differences in the

organization and staffing of TTOs. Our analysis reveals that US TTOs do not attach more

importance to generating revenue as an objective than their European counterparts. However,

they employ more staff with experience in industry which explains some of the remaining

differential in license income performance.

Martin H. VARGAS, September 2009, LICENSING PROBABILISTIC PATENTS AND

LIABILITY RULES

http://mpra.ub.uni-muenchen.de/17593/

In this paper a dynamic game is used to compare licensing of a cost reduction innovations

under lost profits (LP) and unjust enrichment (UE), both damage rules used by courts in the

calculation of damages when a patent has been infringed.

The innovation, whose property right belongs to a firm (patent holder) has a positive probability

to be declared invalid in a court. The market is composed by two homogeneous firms that


60

compete in quantities (Cournot). Licensing by using royalty rates is preferred compared with

fixed fees, it is observable little licensing (just big innovations).

LP is better (almost all cases) than UE for the industry and society. However in the major of

the cases consumers are better off under UE and in the major of cases LP benefits more to

the patent holder.

Christoph GRIMPE, Katrin HUSSINGER, 2009, INVENTIONS UNDER SIEGE? THE IMPACT

OF TECHNOLOGY COMPETITION ON LICENSING, Discussion Paper No. 09-039


In recent years, the view on patents as an instrument for firms to appropriate the returns from

inventive activities has shifted towards a more explicit consideration of a patent’s strategic

importance. In fact, firms have increasingly contributed to and been confronted with a patent

landscape characterized by numerous but marginal inventions, overlapping claims and

multiple patent ownerships for complementary technologies, as well as by patent fences of

substitute technologies owned by a single firm or a group of firms. Existing literature suggests

that both the fragmentation of ownership and the threat of a firm’s patent applications being

blocked by other patents lead to increased patenting and in-licensing activity in order to

mitigate potential hold-up by opportunistic patentees owning critical patents. In this paper, we

argue that firms facing a high chance of being blocked by technology competitors engage both

in in- and out-licensing of technology. This suggests that the blocking threat favors investment

in patent licenses rather than in pure in-house research and development (R&D) for some

firms while it increases licensing revenues of firms owning blocking patents. The relationship

should be particularly pronounced in complex technologies as these exhibit a higher density of

patent thickets compared to discrete technologies. We construct a novel measure that

captures the threat of being blocked if a firm files an average patent application conditional on

its technology portfolio. Based on a comprehensive dataset of more than 400 manufacturing

firms from Germany, our results largely confirm the research hypotheses. Distinguishing the

effect of the blocking threat for firms in discrete and complex industries (i.e., product

technologies characterized as complex contain a large number of patentable elements while

product technologies characterized as discrete consist of relatively few patentable elements),

we find that the likelihood of being blocked only affects the licensing activities of firms in

complex industries, while there is no effect of blocking on licensing for firms operating in

discrete industries. This result is in line with the argument that licensing can mitigate hold-up

problems in technology markets. In addition, we take account of the potential feedback effects

of licensing on internal R&D investments of the firm and find that these are endogenous.


61

Maria PLUVIA ZUNIGA, Dominique GUELLEC, March 2009, WHO LICENSES OUT

PATENTS AND WHY? LESSONS FROM A BUSINESS SURVEY, OECD Science,

Technology and Industry Working Papers, 2009/5, OECD publishing, © OECD


The increasing importance of licensing for innovation is supported by ample anecdotal

evidence. However, statistics on this topic are scarce. The OECD, together with the European

Patent Office and the University of Tokyo, carried out a business survey on the licensing-out of

patents. The goal was to investigate the intensity of licensing to affiliated and non-affiliated

companies, its evolution, the characteristics, motivations and obstacles met by companies

doing or willing to license. The target population was patent holders: 600 European firms and 1

600 Japanese firms responded to the survey, in the second half of 2007. The results show that

patent licensing is widespread among patenting firms: around one company in five in Europe

licenses patents to non-affiliated partners, whereas more than one in four does so in Japan.

The relationship between size of the firm and probability to license out is U-shaped: small firms

and large firms are more likely to license out their patented inventions. In Europe, SMEs have

more difficulties to license out their patents than large firms. The major barrier to licensing out

patent markets is informational (identifying partners). Finally, we also find that more than one

third of young European firms (born after 2000) deem patents as quite or very important to

convince private investors and venture capitalists to provide them with funds.

Iain M. COCKBURN, Megan J. MACGARVIE and Elisabeth MÜLLER, November 2008,

PATENT THICKETS, LICENSING AND INNOVATIVE PERFORMANCE

http://ideas.repec.org/p/zbw/zewdip/7475.html

We examine the relationship between fragmented intellectual property (IP) rights and

innovative performance, taking into consideration the role played by in-licensing of IP.

Controlling for a variety of firm and market characteristics, we find that firms facing more

fragmented IP landscapes are more likely to report expenditures on in-licensing and for those

firms that do incur license costs we find a weak positive association between licensing

expenditure and fragmented IP rights in the relevant technology. We also observe a negative

relationship between IP fragmentation and innovative performance, but only for firms that

engage in in-licensing and only for product innovation. The relationship between fragmentation

and innovative performance also depends on the size of a firm’s patent portfolio, which

suggests an important strategic role for defensive patenting in the context of fragmented

property rights.


62

Joel SANDONÍS, Ramón FAULÍ-OLLER, April 2007, PATENT LICENSING BY MEANS OF AN

AUCTION: INTERNAL VS. EXTERNAL PATENTEE

http://www.ivie.es/downloads/docs/wpasad/wpasad-2007-09.pdf

An independent research laboratory owns a patented process innovation that can be licensed

by means of an auction to two Cournot duopolists producing differentiated goods. For large

innovations and close enough substitute goods the patentee auctions of only one license,

preventing the full diffusion of the innovation. For this range of parameters, however, if the

laboratory merged with one of the firms in the industry, full technology diffusion would be

implemented as the merged entity would always license the innovation to the rival firm. This

explains that, in this context, a vertical merger is both profitable and welfare improving.

Maria Isabella LEONE, Raffaele ORIANI, 2007, THE OPTION VALUE OF PATENT

LICENSES

http://elsa.berkeley.edu/~bhhall/e222spring07_files/LEONE_ORIANI_TheOptionValueOfPaten

tLicenses.pdf

Patent valuation is one of the most relevant issues within the studies on the management of

intellectual property rights. As firms rely more and more on external sources of innovation, the

need for reliable measurements of what is traded becomes essential. Patent valuation is

especially challenging primary because of the great uncertainty affecting their returns and for

the lack of market-based data. The most recent and promising attempts in this research field

have been developed within the real option theory (ROT), which recognizes the effect of

uncertainty on patent value, and they have taken advantage of the increasing amount of

information available about licenses. The aim of this paper is to propose and empirically test a

valuation model of licensed patents based on ROT. According to our model, the initial fee paid

by the licensee is considered analogous to the premium she is willing to pay to buy an option

to commercialize the licensed patents in the future. A fundamental prediction of ROT is that

this option value increases with volatility. In order analyze the relationship between volatility

and the initial fee of the license, we assume that volatility is primarily determined by market

and technological uncertainty. We analyse 105 patent licenses. The results of our regression

model show that both market and technological uncertainty positively affect the initial fee paid

for a patent license.

15. Patents and gender

Ejermo, Olof & Jung, Taehyun (2012), DEMOGRAPHIC PATTERNS AND TRENDS IN

PATENTING: GENDER, AGE, AND EDUCATION OF INVENTORS


63

http://ideas.repec.org/p/hhs/lucirc/2012_005.html

This paper uses register-linked patent records covering an extended period 1985-2007 to

analyze detailed demographic profiles of inventors. The analysis covers about 80 percent of all

inventors with Swedish addresses listed on European Patent Office records. Examining

temporal trends of gender, age, and education shows that the body of inventors is becoming

more balanced in gender, younger, and more educated. However, the rate at which female

inventors are entering into patenting has slowed down since the early 2000’s compared to the

mid-1990s. Moreover, comparing the inventor sample with the entire population of Sweden

reveals that 1) the closing of the gender gap in inventing is not taking place at the same rate

as among Ph.D. holders and that 2) the dependence of inventing on the highly educated

(especially, Ph.D. holders) is being intensified over time, but the number of highly educated is

growing faster among the general population than among inventors. Finally, the analysis

shows that there is significant heterogeneity in the composition and tendency of gender, age,

and education of inventors across technology fields.

Yu MENG, January 2010, WOMEN IN PATENTING: DOES NANOTECHNOLOGY MAKE A

DIFFERENCE?


The lower level of women’s scientific productivity relative to men’s has been well documented

as a consistent pattern over time and across disciplines (Astin 1969; Cole and Cole 1973; Cole

and Zuckerman 1984; Fox and Faver 1985; Long 1987; Zuckerman 1987; Long 1992;

Creamer 1998; Levin and Stephan 1998; Long 2001; Zuckerman 2001; Fox 2005). Given the

close association between productivity and rewards in science, the fact that women scientists

are less productive has a significant and negative impact on their career advancement by

creating and perpetuating gender inequality in other important dimensions beyond productivity,

such as promotion and salary (Fox 1999; Fox 2001; Fox and Stephan 2001). The resulted

pervasive gender inequality in science has been detrimental to social values and economic

development by reinforcing negative stereotypes and discouraging talented people to

participate in and contribute to science and technology (S&T).

However, the traditional research on gender difference in scientific productive focused more

on academic scientists and their publication productivity. This volume of research cannot show

us the full picture of women’s status with regard to productivity in the contemporary S&T

community any more because some dramatic exchanges have occurred in the S&T context

and impose potential influence on women scientists’ performance relative to their male

counterpart’s, among which the emergence of commercial sciences, the quick rise of


64

interdisciplinary sciences, and the influx of women in S&T employment sectors outside of

academia are the most relevant. Although scholars are making efforts to address the effects of

these contextual changes on the theme, including those investigating women’s involvement in

commercial activities relative to men’s (Thursby and Thursby 2005; Whittington and Smith-

Doerr 2005; Ding, Murray et al. 2006; Murray and Graham 2007; Stephan and El-Ganainy

2007), those assessing women’s performance in industry (Evetts 1996; Reskin and McBrier

2000; Padavic and Reskin 2002; Smith-Doerr 2005; Whittington 2007; Bunker Whittington

2009), and those discussing more likelihood of women’s participation in interdisciplinary

sciences (Rhoten and Parker 2004; Carayol and Thuc Uyen Nguyen 2005; Corley and

Gaughan 2005; Rhoten and Pfirman 2007), they only capture one or two aspects of the total

changing trend, still leaving the complete knowledge need unmet.

This study develops a comprehensive framework that integrates above highlighted contextual

changes to assess the effects of nanotechnology (as an example of interdisciplinary sciences)

on gender differences in commercial output (patents here) across all S&T employment

sectors. Using a unique nano-related patent database developed by Porter and his colleague

(Porter, Youtie et al. 2008) and adopting a methodology of identifying inventors' sex from their

first names (Naldi et al. 2002, 2004; Frietsch et al. 2009), the study will provide empirical

information to answer whether nanotechnology has some effect on narrowing the gender gap

in patenting. As my preliminary result shows that the gender gap in patent outputs is smaller in

nanotechnology, The study is expected not only to fill the gap between current literature and

the need for updated knowledge, but also to provide justification on the huge investment in

interdisciplinary sciences from social equality perspective and to suggest effective means of

attracting women in S&T.

Ulrike BUSOLT, Kordula KUGELE, Iris TINSEL, 2008, EUROPEAN STUDIES ON GENDER

ASPECTS OF INVENTIONS - STATISTICAL SURVEY AND ANALYSIS OF GENDER

IMPACT ON INVENTIONS (ESGI)

http://www.esgi.de/uploads/media/080901_IAF_Forschungsbericht_2008.pdf

Ulrike BUSOLT, Kordula KUGELE, Svenja PALTZ, ESGI (European Study on Gender Aspects

of Inventions) project: WHAT IS THE CURRENT STATE OF THE FEMALE CONTRIBUTION

OF EUROPEAN INVENTORS TO PATENT APPLICATIONS FILED AT THE EUROPEAN

PATENT OFFICE?

http://www.esgi.de/uploads/media/071112_WorkReport1.pdf

This report is part of the ESGI project which started in October 2006 and runs till September

2008. The project is financed by the European Commission under the Sixth Framework


65

Programme and located at Hochschule Furtwangen University in Germany. Within this

Specific Support Action the gender impact on inventive activities within the time-span 2001 –

2003 will be investigated.

The ESGI inventor and patent database consists of 157 645 patent applications to the

European Patent Office with priority year 2001, 2002 and 2003. The sample includes the data

of 388 844 inventors of which 360 844 or 93% have a residence address in one of the

European Union Member States.

German inventors clearly dominate the European patenting activities. 46.9% of all inventors

have a German residence address. Inventors from France count up for 13.6% followed by

Great Britain with 10.2% and Italy as well as the Netherlands with 7.0% each.

On the basis of an existing first name database, containing names from six countries, the

project developed the extended first name database “FNDB ESGI”. It includes a total of 11 301

names from 27 European countries. ESGI proved to be an efficient tool for the gender

assignment of inventor’s names in the inventor and patent database.

93% of all inventors with a residence address in the EU-27 were classified as male or female.

The success rate for the 27 different EU Member States ranges from 100% to 81%.

Out of all European inventors 8.3% are women and 91.7% are men, meaning that out of 10

inventors approximately one is a woman. Pronounced differences between the different

countries are found for this indicator. The female proportions ranges from 23.1% for the best

achieving country Lithuania to 4.8% for the least achieving country Austria. It stands out that

the highest proportions of female inventors are found in the Eastern European Union Member

States which in contrast are low in absolute numbers of patent applications. Germany, the

leading country in patenting activities in general, reaches a female share of 6.1% only. Thus,

this striking disproportion particularly lowers the European average.

The indicator contribution (patent-equivalents) generally is lower than the female share of

inventors and sums up to 6.3% for the EU-27 average. These comparatively lower shares

indicate that women invent in larger groups than men do.

All patent applications were allocated to eight sections and 31 technical units.

Concluding these findings the dominance of women in section A “Human necessities” and C

“Chemistry/Metallurgy” is pronounced. Female researchers invent most often in pharmacy

(22.7%) and biotechnology related technologies (22.2%) where approximately one out of four

patents is filed by a woman. High rates are also found in chemistry related areas while the

female activities are low in the mechanical, construction, physics and electrical sections.

The business enterprise sector clearly dominates the patenting activities in the European

Union since 87.8% of all patents are applied for by inventors from the business enterprise

sector. The other sectors reach shares of 3.9% (individuals), 2.0% (higher education), 1.8%


66

(government), 1.9% (private non-public) and 0.1% (hospital). A total of 2.5% inventors could

not be allocated to a sector.

In the business enterprise sector the female proportion counts up to 7.9%, meaning that out of

100 patents only 12 were applied by women, whereas 88 were applied by men.

Compared to the general distribution, women generally apply for patents in those technological

areas where larger groups are present.

HALLER, M. VROHLINGS, R. FRIETSCH, H. GRUPP, Studien zum deutschen

Innovationssystem, Nr. 18-2007, Studie im Rahmen der Berichterstattung zur

Technologischen Leistungsfähigkeit Deutschlands, ANALYSE DES TECHNISCHEN UND

WISSENSCHAFTLICHEN BEITRAGS VON FRAUEN

http://www.bmbf.de/pubRD/sdi-18-07_.pdf

The aim of this study is to measure and to describe the technical and scientific contribution of

women. Patent applications and publications have been analysed. The study used data from

14 countries France, Germany, Italy, Spain, Sweden, the United Kingdom, Austria, Australia,

Belgium, Switzerland, Denmark, Ireland, New Zealand and the United States. Three indicators

are used to show the patent activities and the publication from women in an empiric form:

participation as inventor/author, citation as inventor/author and contribution as inventor/author.

Waverly W. DING, Pierre AZOULAY and Toby E. STUART, Journal of Economic Behavior and

Organization, 2007, vol. 63, p. 599-623, THE DETERMINANTS OF FACULTY PATENTING

BEHAVIOR: DEMOGRAPHICS OR OPPORTUNITIES?

http://www.haas.berkeley.edu/faculty/papers/ding7_determinants%20of%20faculty%20patenti

ng.pdf

We examine the individual, contextual, and institutional determinants of faculty patenting

behavior in a panel dataset of 3,862 academic life scientists. Using discrete time hazard rate

models and fixed effects logistic models, we find that patenting events are preceded by a flurry

of publications, even holding constant time-invariant scientific talent and the latent patentability

of a scientist’s research. Whereas previous research emphasized that academic patenters are

more accomplished on average than their non-patenting counterparts, our findings suggest

that patenting behavior is also a function of scientific opportunities. This result has important

implications for the public policy debate surrounding academic patenting.

Waverly W. DING, Fiona MURRAY, and Toby E. STUART, 2006, GENDER DIFFERENCES

IN PATENTING IN THE ACADEMIC LIFE SCIENCES

http://haas.berkeley.edu/faculty/papers/ding9_gender%20differences%20in%20patenting.pdf


67

We analyze longitudinal data on academic careers and conduct interviews with faculty

members to determine the scope and causes of the gender gap in patenting among life

scientists. Our regressions on a random sample of 4,227 life scientists over a 30-year period

show that women faculty members patent at about 40 percent of the rate of men. We find that

the gender gap has been improving over time, although it remains large.

Angela HULLMANN, October 2001, BIBLIOMETRIC AND PATENT INDICATORS BY

GENDER: IS IT FEASIBLE?

ftp://ftp.cordis.europa.eu/pub/indicators/docs/ind_wp_ah1.pdf

Both publication and patent indicators are used as proxy to measure the scientific and

technological productivity of a country. An application for a patent indicates that there has

been a production of new knowledge linked to an invention, and, more importantly, that this

knowledge might have potential economic returns. The bibliometric indicator that measures

the number of publications gives an indication of the research capacity of a country or of a

specific research community within the country as well as the changes in scientific productivity

over time.

Given the importance attached to patent indicators as an output indicator, it might be

worthwhile to investigate the gender issue. Are women more or less productive in the area of

science and technology, are they associated with patents of higher economic value, in which

technology fields do they tend to be present? Similar important questions can be asked about

the publication indicator: do women publish more than men, in which disciplines and

technology fields are they most active, do they publish higher quality papers?

Despite the importance of these questions – also with a view on the utilisation of a country’s

human resources – little information is systematically recorded on the gender of inventors and

authors. In order to support the development of a methodology that enables registering gender

aspects, the European Commission decided to commission two feasibility studies. Both

studies were carried out by Biosoft in Milano, Italy.

This paper relies on extracts from the final reports of the two studies. This paper will describe,

first, the methodological design of the so-called First Name Data Base (FNDB) which was

developed in these feasibility studies to determine the gender of the inventor or author.

Secondly, this paper will present the results emerging from the use of the FNDB methodology

to generate patent and bibliometric data by gender for six EU countries, nine disciplines and

31 technology fields. Finally, the paper will assess the feasibility of the FNDB methodology

and finish with an outlook if and how this methodology could be extended to all fifteen EU

Member States.


68

16. Patents and name harmonisation

Grid THOMA, Salvatore TORRISI, Alfonso GAMBARDELLA, Dominique GUELLEC, Bronwyn

H. HALL, Dietmar HARHOFF, Draft version 3 June 2009, METHODS AND SOFTWARE FOR

THE HARMONIZATION AND COMBINATION OF DATASETS: A test based on IP-related

data and accounting databases with a large panel of companies at the worldwide level

https://docs.google.com/viewer?url=http%3A%2F%2Fwww.esf-ape-

inv.eu%2Fdoc%2Fupload%2FTTGGHH_200920091117120005.pdf

The lack of firm-level data on innovative activities has always constrained the development of

empirical studies on innovation. More recently, the availability of large datasets on indicators

such as R&D expenditures and patents has relaxed these constraints and spurred the growth

of a new wave of research. However, measuring innovation still remains a difficult task for

reasons linked to the quality of available indicators and the difficulty of integrating innovation

indicators to other firm-level data.

Data on R&D expenditures have traditionally been used as a proxy for innovation effort or

value, but because they measure input they are unable to tell us much about the ‘success' of

innovative activities, nor do they give much detail about their direction. Moreover, especially in

the case of European firms, data on R&D expenditures are often missing because reporting

these expenditures is not required by accounting and fiscal regulations in a number of

countries. Therefore, an increasing number of studies have used patents counts as a measure

of inventive output. However, crude patent counts are an extremely noisy indicator of inventive

output because they do not account for differences in the value of patented inventions. For this

reason, many innovation scholars have introduced various patent-related indicators as a

measure of the importance or ‘quality' of the inventive output.

Eric J. IVERSEN, Iiro MÄKINEN, Hans LÖÖF, Dong-hyun OH, Svend T. JESPERSEN, Martin

JUNGE and Jonas BECH, April 2009, SMALL NORDIC ENTERPRISES - DEVELOPING IPR

IN GLOBAL COMPETITION

http://scripts.abe.kth.se/cesis/documents/WP178.pdf

This paper presents the results of a pan-Nordic study to explore how small and medium-size

enterprises use IPR. It is a pilot study that demonstrates a commonly developed approach

designed to overcome the barriers that hinder study of IPR use by small firms. The pilot study

focuses particularly on patenting, based on the common approach linking national business

registries with patent applicants. This is the first cross-country project of its kind to develop and

execute such an exercise. It applies available definitions and approaches to improve

comparability in the Nordic area and with other efforts (such as the OECD patent name

harmonization activity). The intention is to demonstrate how this cross-country approach can


69

address the needs of policymakers in the Nordic countries for reliable and comparative

information about IPR use among the smallest firms.

Grid THOMA, Salvatore TORRISI, 2007, CREATING POWERFUL INDICATORS FOR

INNOVATION STUDIES WITH APPROXIMATE MATCHING ALGORITHMS. A TEST BASED

ON PATSTAT AND AMADEUS DATABASES

ftp://ftp.unibocconi.it/pub/RePEc/cri/papers/WP211ThomaTorrisi.pdf

The lack of firm-level data on innovative activities has always constrained the development of

empirical studies on innovation. More recently, the availability of large datasets on indicators,

such as R&D expenditures and patents, has relaxed these constrains and spurred the growth

of a new wave of research. However, measuring innovation still remains a difficult task for

reasons linked to the quality of available indicators and the difficulty of integrating innovation

indicators to other firm-level data. As regards quality, data on R&D expenditures represent a

measure of input but do not tell much about the ‘success’ of innovative activities. Moreover,

especially in the case of European firms, data on R&D expenditures are often missing

because reporting these expenditures is not required by accounting and fiscal regulations in

some countries.

An increasing number of studies have used patents counts as a measure of inventive output.

However, crude patent counts are a biased indicator of inventive output because they do not

account for differences in the value of patented inventions. This is the reason why innovation

scholars have introduced various patent-related indicators as a measure of the ‘quality’ of the

inventive output.

Integrating these measures of inventive activity with other firm-level information, such as

accounting and financial data, is another challenging task. A major problem in this field is

represented by the difficulty of harmonizing information from different data sources. This is a

relevant issue since inaccuracy in data merging and integration leads to measurement errors

and biased results.

An important source of measurement error arises from inaccuracies in matching data on

innovators across different datasets. This study reports on a test of company names

standardization and matching. Our test is based on two data sources: the PATSTAT patent

database and the Amadeus accounting and financial dataset. Earlier studies have mostly

relied on manual, ad-hoc methods. More recently scholars have started experimenting with

automatic matching techniques. This paper contributes to this body of research by comparing

two different approaches – the character-to-character match of standardized company names

(perfect matching) and the approximate matching based on string similarity functions. Our

results show that approximate matching yields substantial gains over perfect matching, in


70

terms of frequency of positive matches, with a limited loss of precision – i.e., low rates of false

matches and false negatives.

Tom MAGERMAN, Bart VAN LOOY, Xiaoyan SONG, November 2006, DATA PRODUCTION

METHODS FOR HARMONIZED PATENT STATISTICS: PATENTEE NAME

HARMONIZATION, KUL Working Paper No. MSI 0605


0

Patent documents are one of the most comprehensive data sources on technology

development. As such, they provide a unique source of information to analyze and monitor

technological performance. Patent indicators are now used by companies and by policy and

government agencies alike to assess technological progress on the level of regions, countries,

domains, and even specific entities such as companies, universities and individual inventors.

In this paper, we develop a comprehensive method to achieve harmonization of patentee

names in an automated way so that analysis at the level of patentees can be facilitated. The

method has been applied to an extensive set of all patentee names found for all EPO patent

applications published between 1978 and 2004 and all granted USPTO patents published

between 1991 and 2003. As completeness (the extent to which the name-harmonization

procedure is able to capture all name variants of the same patentee) and accuracy (the extent

to which the name-harmonization procedure correctly allocates name variants to a single,

harmonized patentee name) do not go hand in hand, priority has been given to accuracy.

Before discussing in detail the methodology and its effects as applied to the EPO and USPTO

patentee name list, we will first clarify the difference between patentee name harmonization

and legal entity identification. In addition, we will briefly expand on the methods and

approaches previously developed to address the issue of patentee name harmonization, in

order to shed light on our specific contribution. Finally, future refinements and extensions are

discussed.

17. Foreign applications/co-patents/cooperation

Valentina DE MARCHI, January 2010, COOPERATION TOWARD GREEN INNOVATION: AN

EMPIRICAL INVESTIGATION


This paper explores the relationship between firms' cooperation on innovation and green

innovation propensity.


71

As consumers awareness on environmental problem is on the rise and policies are

increasingly directed to push eco-friendly productions, the attention of firms to reduce their

impact on the environment is becoming mainstream in many industries. The way companies

integrate environmental concerns into their strategies, while consolidating their competitive

advantage, is through green innovations.

Previous literature has demonstrated the peculiarity of green innovation with respect to other

innovations as regards its drivers (Horbach, 2008), its positive spill-overs (Rennings, 2000),

the importance of regulation to trigger it (Porter and van der Linde, 1995).

I add to this stream of literature that such innovations differ from other innovations also

because they are more likely the result of a cooperative effort with partners of their network.

Green innovations are in fact inherently systemic (Foxon and Andersen, 2009, Senge,

Carstedt, and Porter, 2001) for technological, organizational or marketing issues. As far as the

different production process stages are split among different firms, due to the fragmentation of

production, firms need to coordinate the innovative effort with such parters. Furthermore,

needing complementary assets and capabilities (Teece, 1986) that are external to the firm or

need to be created ad hoc, green innovators engage in cooperative agreements with industrial

partners and knowledge providers to complement internal resources (Hemmelskamp, 1999,

Love and Roper, 2009).

Despite the importance of understanding eco-friendly innovation propensity and the

antecedents of its successfully implementation and diffusion for policy and firm strategies

development, there is still little empirical evidence: studies that systematically analyzed such

topic are scarce and mainly qualitative or empirically bounded (Geffen and Rothenberg, 2000,

Mazzanti and Zoboli, 2005). The purpose of this paper is to fill this gap, by analyzing the

impact of network innovative activities on green innovative propensity.

The contribution of this paper is intended to be two-fold: theoretical, by providing a framework

that build on network and innovation economics literature to analyze determinants of green

innovation, as briefly described above; and empirically, by testing these hypothesis at the

microeconomic level.

I use the 2007 Community Innovation Survey for Spanish firms (PITEC) data in order to

investigate the relations between the number of interorganizational cooperative agreements

and the type of partners on green innovative performance of firms. The dataset, made by 6196

manufacturing firms, contains information on firm structural characteristics, R&D and

innovation cooperation attitudes and characteristic of the innovations. To test the hypothesis a

logit model on innovative firms controlling for possible selection bias is used. The results

confirm the hypothesis that green innovative firms rely on external knowledge and cooperate

on innovation to an higher extend than other innovative firms, engaging in an higher number of


72

cooperative agreements. Furthermore, the role of suppliers and of kibs and universities seems

to be more relevant than for other innovations, whereas clients doesn't seems to affect green

innovation to a different degree than other innovations.

Federico CAVIGGIOLI, January 2010, INTERNATIONAL PATENT EXTENSIONS: FOREIGN

APPLICATIONS AT THE JAPAN PATENT OFFICE


This article aims to evaluate some of the possible factors which could have had a significant

role in the increase in the yearly number of foreign patent applications at the Japan Patent

Office. Starting from the 90’s, foreign applications increased constantly while the number of

domestic filings remained almost the same or even decreased. The increase is more striking

when compared to analogue figures for the US Patent and Trademark Office and the

European Patent Office, where the same ratio didn’t change too much in the same period.

The existing literature has recognized, not always unanimously, some factors affecting the

propensity to file a patent application in a foreign country. A group of them is related to the

innovativeness of the extending countries (Eaton and Kortum, 1996; Grupp and Schmoch,

1999; Furman et al., 2002; van Zeebroeck et al., 2009) while other authors have focused on

the characteristics of the recipient country (Bosworth, 1984; Maskus, 1998; O’Keefe, 2005).

This paper tries to capture the relevance of such drivers in the increased amount of foreign

patent applications at the JPO.

The innovativeness of the extending countries is measured through their wealth, size and

research commitment, respectively proxied by GDP per capita, population and R&D

expenditures. The attractiveness of the recipient country is similarly indexed by analysing its

wealth, market size and the peculiarities of the national patent office in charge to process

international patent applications. With these considerations, Japan is valuated by its GDP per

capita, population, patent fee and the level of the harmonization of Japan patent system

compared to each extending country, by evaluating the Ginarte and Park patent protection

index (1997 and 2008).

The dependent variable is the number of patent application filed at the JPO by each country

per every year from 1991 to 2005. The data have been collected from the JPO Annual

Reports. Since it can assume only positive integer values and it is affected by overdispersion I

decided to use a negative binomial model for panel data. In order to take in consideration

possible missed differences among countries, I opted for a fixed effects regression. To control

for the involvement of each extending country in Japan economy, I considered the level of FDI

and of trade to Japan from each originating nation and the proximity in terms of filed patents at


73

the USPTO and the EPO. In the same way I tried to keep trace of the national propensity to

patent in general

Regression results show a positive influence of some of the characteristics of the extending

countries, in particular: population and commitment to R&D and of the level of harmonization

between Japan’s and each extending country’s patent system; entry fee, Japan’s population

and GDP per capita, trade and FDI are much less relevant.

18. Patent citations

Czarnitzki, Dirk & Hussinger, Katrin & Leten, Bart (2011), THE MARKET VALUE OF

BLOCKING PATENT CITATIONS

http://ideas.repec.org/cgi-bin/htsearch?np=1&q=patent+citation

There is a growing literature that aims at assessing the private value of knowledge assets and

patents. It has been shown that patents and their quality as measured by citations received by

future patents contribute significantly to the market value of firms beyond their R&D stocks.

This paper goes one step further and distinguishes between different types of forward citations

patents can receive at the European Patent Office. While a patent can be cited as non-

infringing state of the art, it can also be cited because it threatens the novelty of patent

applications ('blocking citations'). Empirical results from a market value model for a sample of

large, R&D-intensive U.S., European and Japanese firms show that patents frequently cited as

blocking references have a higher economic value for their owners than patents cited for

nonblocking reasons. This finding adds to the patent value literature by showing that different

types of patent citations carry different information on the economic value of patents. The

result further suggests that the total number of forward citations can be an imprecise measure

of patent value.

Joaquín M. AZAGRA-CAROA, Pauline MATTSSON, François PERRUCHAS, 2010,

SMOOTHING THE LIES: DO PATENT EXAMINERS TAKE NOTICE IF APPLICANTS

INCLUDE CITATIONS?

https://docs.google.com/viewer?url=http%3A%2F%2Fdigital.csic.es%2Fbitstream%2F10261%

2F26646%2F1%2FSmoothing%2520the%2520lies_%2520Do%2520patent%2520examiners

%2520take%2520notice%2520if%2520applicants%2520include%2520citations_%255B1%25

5D.pdf


74

Examiner patent citations are a popular source of indicators of technological impact and

knowledge flows, despite various critiques. We analyse the distribution of examiner patent

citations according to patent characteristics, to show their comparative meaningless. Our

findings show that it is the science-base of the technology that determines the inclusion of

applicant citations. However, this gets masked by the citations added by patent examiners,

who smooth the distribution of citations across technology classes and include the ‘standard’

knowledge bases regardless of which references applicants cite. Some researchers have

called for the use of applicant rather than examiner patent citations to build indicators of

technology impact and knowledge flows. However, we show that the former are not

necessarily ‘better’ than the latter, because applicants may ‘inflate’ the numbers in

international patents especially when there are co-applicants. The implications are that

analysts should consider alternative uses of patent citations e.g. to build indicators of trust

within a research system.

Georg VON GRAEVENITZ, Stefan WAGNER, Dietmar HARHOFF, July 2009, HOW TO

MEASURE PATENT THICKETS - A NOVEL APPROACH, Discussion paper 2009-9

http://epub.ub.uni-muenchen.de/

The existing literature identifies patent thickets indirectly. In this paper we propose a novel

measure based on patent citations which allows us to measure the density of patent thickets

directly. We discuss the algorithm which generates the measure and present descriptive

results validating it. Moreover, we identify technology areas which are particularly impacted by

patent thickets.

Emanuele BACCHIOCCHIY, Fabio MONTOBBIO, February 2009, INTERNATIONAL

KNOWLEDGE DIFFUSION AND HOME-BIAS EFFECT. DO USPTO & EPO PATENT

CITATIONS TELL THE SAME STORY?

http://portale.unibocconi.it/wps/wcm/connect/resources/file/eb50cd098ee9388/WP15_Bacchio

cchiMontobbio.pdf

This paper estimates the international diffusion and obsolescence of technological knowledge

by technological field and country using patent citations from the U.S. Patent and Trademark

Office (USPTO) and from the European Patent Office (EPO). We control for self-citations and

for procedural and legal differences between patent offices in the citation procedures using

equivalent patents. We show that (1) both at the EPO and USPTO domestic citations come

sooner and there is a strong localization effect of patent citations at national level; (2) the US

technological system is becoming less central in the international web of knowledge flows; (3)

some differences across patent offices emerge in the ranking by technological fields in the


75

speed of diffusion and decay of technological knowledge. We support the conjecture that not

only technological opportunities but also absorptive capacity plays a role. Finally on the

methodological side we show that at the USPTO the median citation lag is twice as large

relatively to the citations at the EPO, that some bias is induced by the different institutional

practices at the EPO and USPTO and that using patent families generates a selection bias

towards high quality patents.

Fabio MONTOBBIOA and Valerio STERZI, November 2008, INVENTING TOGETHER:

EXPLORING THE NATURE OF INTERNATIONAL KNOWLEDGE SPILLOVERS IN LATIN

AMERICA

http://eco.uninsubria.it/webdocenti/fmontobbio/papers/Montobbio_Sterzi2011.pdf

This paper studies the nature, sources and determinants of international patenting activity in

Latin American countries (LACs) and examines the extent to which LACs benefit from R&D

that is performed in the G-5 countries (France, Germany, Japan, United Kingdom, and United

States). By using patents and patent citations at the United States Patent and Trademark

Office we trace intrasectoral knowledge flows from G-5 countries to LACs. We study the

impact of three channels of spillovers: pure spillovers, patent citations related spillovers, and

face-to-face contact spillovers. Our results, based on data for Argentina, Brazil, Chile,

Colombia, and Mexico, suggest that international knowledge spillovers from the G-5 countries

are a significant determinant of inventive activity over the period 1988-2003. In particular we

find that the stock of ideas produced in the US has a strong impact on the international

patenting activity of these countries. Moreover controlling for US-driven pure spillover effects,

bilateral patent citations and face-to-face relationships between inventors are both important

additional mechanisms of knowledge transmission. Some of our results suggest that the latter

mechanism is more important than the former.

Juan ALCÁCER, Michelle GITTELMAN, Bhaven SAMPAT, July 2008, APPLICANT AND

EXAMINER CITATIONS IN US PATENTS: AN OVERVIEW AND ANALYSIS

http://www.hbs.edu/research/pdf/09-016.pdf

Researchers studying innovation increasingly use indicators based on patent citations.

However, it is well known that not all citations originate from applicants— patent examiners

contribute to citations listed in issued patents—and that this could complicate interpretation of

findings in this literature. In 2001 the US Patent and Trademark Office (USPTO) began

reporting examiner and applicant citations separately. In this paper, we analyze the prior art

citations of all patents granted by the USPTO in 2001–2003. We show that examiner citations

account for 63 per cent of all citations on the average patent, and that 40 per cent of patents


76

have all citations added by examiners. We use multivariate regression and analysis of

variance to identify the determinants of examiner shares. Examiner shares are highest for non-

US applicants and in electronics, communications, and computer-related fields. However,

most of the variation is explained by firm-specific variables, with the largest patent applicants

having high examiner shares. Moreover, a large number of firms are granted patents that

contain no applicant prior art. Taken together, our findings suggest that heterogeneity in firm-

level patenting practices, in particular by high-volume applicants, has a strong influence on the

data. This suggests that analysis of firm-level differences in patenting strategies is an

important topic for future research.

Tom MAGERMAN, Bart VAN LOOY, Xiaoyan SONG, July 2008, EXPLORING THE

FEASIBILITY AND ACCURACY OF LATENT SEMANTIC ANALYSIS BASED TEXT MINING

TECHNIQUES TO DETECT SIMILARITY BETWEEN PATENT DOCUMENTS AND

SCIENTIFIC PUBLICATIONS

http://ssrn.com/abstract=1191744

In this study, we examine and validate the use of existing text mining techniques (based on the

vector space model and latent semantic indexing) to detect similarities between patent

documents and scientific publications. Clearly, experts involved in domain studies would

benefit from techniques that allow similarity to be detected - and hence facilitate mapping,

categorization and classification efforts. In addition, given current debates on the relevance

and appropriateness of academic patenting, the ability to assess content-relatedness between

sets of documents - in this case, patents and publications - might become relevant and useful.

We list several options available to arrive at content based similarity measures. Different

options of a vector space model and latent semantic indexing approach have been selected

and applied to the publications and patents of a sample of academic inventors (n=6). We also

validated the outcomes by using independently obtained validation scores of human raters.

While we conclude that mixed mining techniques can be valuable for detecting similarities

between patents and publications, our findings also indicate that the various options available

to arrive at similarity measures vary considerably in terms of accuracy: some generally

accepted text mining options, like dimensionality reduction and LSA, do not yield the best

results when working with smaller document sets. Implications and directions for further

research are discussed.

Joint Committee on Quantitative Assessment of Research, June 2008, CITATION

STATISTICS, A report from the International Mathematical Union (IMU) in cooperation with the


77

International Council of Industrial and Applied Mathematics (ICIAM) and the Institute of

Mathematical Statistics (IMS).

http://www.mathunion.org/fileadmin/IMU/Report/CitationStatistics.pdf

This is a report about the use and misuse of citation data in the assessment of scientific

research. The idea that research assessment must be done using "simple and objective"

methods is increasingly prevalent today. The "simple and objective" methods are broadly

interpreted as bibliometrics, that is, citation data and the statistics derived from them. There is

a belief that citation statistics are inherently more accurate because they substitute simple

numbers for complex judgments, and hence overcome the possible subjectivity of peer review.

But this belief is unfounded.

Aditi MEHTA, Marc RYSMAN, Tim SIMCOE, May 2008, IDENTIFYING THE AGE PROFILE

OF PATENT CITATIONS: NEW ESTIMATES OF KNOWLEDGE DIFFUSION

http://people.bu.edu/mrysman/research/ageProfile.pdf

Knowledge diffusion is a central issue in the study of innovation, agglomeration and growth,

but is notoriously difficult to measure. Many papers have addressed this problem by using

patent citations as an observable proxy for knowledge flows. These studies typically rely on

functional form assumptions to identify the citation age distribution, given the collinearity

between application-year, citation-year, and patent-age. We show empirically that a patent's

\citation clock" does not start until it issues, and propose a highly flexible identification strategy

that uses the lag between application and grant as a source of exogenous variation. We

examine the potential bias if our identification assumption is incorrect, and discuss potential

extensions into other research areas. Finally, we use our method to re-examine prior results

on the citation age-profile of patents from different technological fields and application-year

cohorts.

Rekha RAO, May 2008, A REPORT ON GEOGRAPHICAL COVERAGE OF IPR RESEARCH,

WP 70


In this report we endeavour to undertake a survey of literature on IPR (Intellectual property

rights) and look at the geographical coverage of the research being undertaken in this field.

This survey gives us an idea of who is working on what and where the researchers are

located. There are 4 important themes in IPR and we observe a broad geographical coverage

among these 4 themes. We shall classify the publications that we had obtained from the above

literature review into following 4 themes, the motivations to patent and the use of patents (T1),

the measurement of patent value and the determinants of high quality patents (T2), the


78

innovation process: the role of organisational competencies, research collaborations and

agglomeration economies (T3) and Inventors and inventors’ productivity (T4).

Roberto FONTANA, Alessandro NUVOLARI, Bart VERSPAGEN, February 2008, MAPPING

TECHNOLOGICAL TRAJECTORIES AS PATENT CITATION NETWORKS. AN

APPLICATION TO DATA COMMUNICATION STANDARDS, SEWP 166

http://www.sussex.ac.uk/spru/documents/sewp166

We use patent citation networks to study the dynamics of technical change in Ethernet, a

standard for data communication. We first consider the evolution of the broad technological

system of Local Area Networks (LANs) and we identify the most significant inventions within

the specific subfield of Ethernet. Then we analyse the structure of connectivity of patent

citation networks to reconstruct the main technological trajectories in this subfield. Our results

suggest that these technological trajectories are characterized by the presence of a number of

interconnected technological environments which cluster following an engineering logic. These

clusters include the most significant patents related to 'milestones inventions' in the evolution

of the LAN technology. Thus, our analysis of the structure of connectivity in patent citation

networks seems appropriate to capture both the cumulativeness associated to the

development of a specific technology and the significant discontinuities that punctuate the

trajectory, as well as the technological interrelatedness characterising large technical systems.

Önder NOMALER, Bart VERSPAGEN, June 2007, KNOWLEDGE FLOWS, PATENT

CITATIONS AND THE IMPACT OF SCIENCE ON TECHNOLOGY

http://www.merit.unu.edu/publications/wppdf/2007/wp2007-022.pdf

Technological innovation depends on knowledge developed by scientific research. The

number of citations made in patents to the scientific literature has been suggested as an

indicator of this process of transfer of knowledge from science to technology. We provide an

intersectoral insight into this indicator, by breaking down patent citations into a sector-to-sector

matrix of knowledge flows. We then propose a method to analyze this matrix and construct

various indicators of science intensity of sectors, and the pervasiveness of knowledge flows.

Our results indicate that the traditional measure of the number of citations to science literature

per patent captures important aspects intersectoral knowledge flows, but that other aspects

are not captured. In particular, we show that high science intensity implies that sectors are net

suppliers of knowledge in the economic sector, but that science intensity does not say much

about pervasiveness of either knowledge use or knowledge supply by sectors. We argue that

these results are related to the specific and specialized nature of knowledge.


79

Alan C. MARCO, Economics Letters, Vol. 94, No. 2, February 2007, THE DYNAMICS OF

PATENT CITATIONS

http://ssrn.com/abstract=949461 The use of patent citations as a measure of patent "quality" increased dramatically in recent

years. In this note, I use hazard estimation to explore the dynamics of patent citation. I find

evidence of unobserved heterogeneity and a means to separate patent quality from citation

"inflation."

Dietmar HARHOFF, Stefan WAGNER, October 2006, MODELING THE DURATION OF

PATENT EXAMINATION AT THE EUROPEAN PATENT OFFICE

http://www.ip.mpg.de/shared/data/pdf/harhoff_wagner_06.pdf

We analyze the duration of the patent examination process at the European Patent Office

(EPO). Our data contain information related to the patent’s economic and technical relevance,

EPO capacity and workload as well as novel citation measures which are derived from the

EPO’s search reports. In our multivariate analysis we estimate competing risk specifications in

order to characterize differences in the processes leading to a withdrawal of the application by

the applicant, a refusal of the patent grant by the examiner or an actual patent grant. Highly

cited applications are approved faster by the EPO than less important ones, but they are also

withdrawn less quickly by the applicant. The process duration increases for all outcomes with

the application’s complexity, originality, number of references (backward citations) in the

search report and with the EPO’s workload at the filing date. Endogenous applicant behavior

becomes apparent in other results: more controversial claims lead to slower grants, but faster

withdrawals, while relatively well-documented applications (identified by a high share of

applicant references appearing in the search report) are approved faster and take longer to be

withdrawn.

Emanuele BACCHIOCCHI and FABIO MONTOBBIO, KNOWLEDGE DIFFUSION FROM

UNIVERSITY AND PUBLIC RESEARCH. 2006, A COMPARISON BETWEEN US, JAPAN

AND EUROPE USING PATENT CITATIONS

http://www.cespri.unibocconi.it/

This paper estimates the process of diffusion and decay of knowledge from university, public

laboratories and corporate patents in six countries and tests the differences across countries

and across technological fields using data from the European Patent Office. It finds that

university and public research patents are more cited relatively to companies’ patents.

However these results are mainly driven by the Chemical, and Drugs & Medical fields and US

universities. In Europe and Japan, where the great majority of patents from public research

comes from national agencies, there is no evidence of a superior fertility of university and


80

public laboratories patents vis-à-vis corporate patents. The distribution of the citations lags

shows that knowledge embedded in university and public research patents tends to diffuse

more rapidly relatively to corporate ones in particular in US, Germany, France and Japan.

Colin WEBB, Hélène DERNIS, Dietmar HARHOFF, Karin HOISL, October 2005, ANALYSING

EUROPEAN AND INTERNATIONAL PATENT CITATIONS: A SET OF EPO PATENT

DATABASE BUILDING BLOCKS

http://www.oecd.org/sti/working-papers

This paper presents a preliminary set of European and international citation data tables

designed to enable researchers to become familiar with the subject and undertake a range of

analyses. It addresses analytical and statistical issues such as why citations from international

searches and European searches should be combined; the calculation of citation lags; use of

International Patent Classification (IPC) codes for grouping patents according to technology;

treatment of references to Non-Patent Literature (NPL); and the notion that many publications,

from different patenting authorities, covering the same invention can be cited. Differences

between US and European citations are also discussed.

The database was built using data kindly provided by the European Patent Office (EPO) and

its development has been carried out under the auspices of OECD’s Patent Statistics Task

Force. The work is an OECD contribution to a wider project to construct a worldwide patent

database mainly co-ordinated by EPO and the World Intellectual Property Organisation

(WIPO). It has already provided useful input into EPO’s current PATSTAT database project to

make their raw patent data more accessible for statistical and econometric analyses.

It is assumed that potential users are reasonably familiar with recent citation analysis

literature. Possible avenues of research such as knowledge spillovers (geographical or across

fields of science), knowledge flows and value of patents are not addressed in this paper but

dealt with in a related document, by the same authors, “European Patent Citations – How to

count and interpret them?”. For the development of citations-based indicators and examples of

a wide range of related analyses, reference to the significant body of work based on US

citations, by researchers such as Hall, Jaffe and Trajtenberg, is encouraged.

The data tables currently cover all patent applications published by EPO and WIPO, under the

Patent Co-operation Treaty (PCT), from their introduction in 1978 up until November 2001.

Elif BASCAVUSOGLUY, September 2005, DOES INTERNATIONAL TRADE TRANSFER

TECHNOLOGY TO EMERGING COUNTRIES? A PATENT CITATION ANALYSIS

http://www.open.ac.uk/ikd/workingpapers/workingpaper_14.pdf


81

The purpose of this paper is to assess empirically whether trade flows carry disembodied

knowledge to emerging countries. Endogenous growth theory predicts that productivity growth

rates of countries are related through international trade linkages and associated embodied

and disembodied knowledge spillovers. Patent statistics are an output indicator of innovation.

This allows patent citations to reflect the process of knowledge diffusion. Combining an

endogenous growth framework with a patent citation analysis, we evaluate whether more

exporting or importing countries tend to cite more foreign patents, i.e. learn more from foreign

technology. The empirical estimation concerns the relative number of backward citations and

bilateral trade flows between 18 emerging and 10 technology source countries, at a sectoral

level, for the period of 1980-1998. We contribute to the previous literature by taking into

account several proximity measures and by distinguishing sector’s technological intensities.

Our results show that trade transfers technology across countries and sectors, but the extent

of the diffusion depends mainly on cultural and historical proximities and the level of technical

capacity of host countries.

Bart VERSPAGEN, June 2005, MAPPING TECHNOLOGICAL TRAJECTORIES AS PATENT

CITATION NETWORKS. A STUDY ON THE HISTORY OF FUEL CELL RESEARCH

http://edocs.ub.unimaas.nl/loader/file.asp?id=1065

Paola CRISCUOLO, Bart VERSPAGEN, 2005, DOES IT MATTER WHERE PATENT

CITATIONS COME FROM? INVENTOR VERSUS EXAMINER CITATIONS IN EUROPEAN

PATENTS, 2005-018, MERIT-Infonomics Research Memorandum series

http://edocs.ub.unimaas.nl/loader/file.asp?id=1061

This paper investigates whether the distinction between patent citations added by the inventor

or the examiner is relevant for the issue of geographical concentration of knowledge flows (as

embodied in citations). The distinction between inventor and examiner citations enables us to

work with a more refined citation indicator of knowledge flows. We use information in the

search reports of patent examiners at the European Patent Office to construct our dataset of

regional patenting in Europe, and apply various econometric models to investigate our

research question. The findings point to a significant localization effect of inventor citations,

after controlling for various other factors, and hence suggest that knowledge flows are indeed


82

geographically concentrated. This holds true also for a sub-sample of patents owned by 169

large multinational enterprises (MNEs). The results for the sample of MNEs suggest that

multinational firms seek out specific regional knowledge specializations (and hence at least

partly reinforce geographical concentration), but are also able to transfer knowledge "easier"

over larger distances.

Bulat SANDITOV, 2005, PATENT CITATIONS, THE VALUE OF INNOVATIONS AND PATH-

DEPENDENCY

http://www.merit.unu.edu/publications/phd/BSanditov.pdf

This paper examines how the framework of path-dependency and technological trajectories

can be applied to explain the observed distribution of patent values as it is revealed in the

distribution of patent citations. A very simple model of based on generalized Polya urn

processes is proposed to describe evolution of patent values. It is shown that the model fits

empirical distribution of patent citations (USPTO and EPO data) surprisingly well.

Ruslan LUKACH and Joseph PLASMANS, 2005, MEASURING KNOWLEDGE SPILLOVERS

USING THE INFORMATION FROM THE BELGIAN FIRMS’ PATENT CITATION DATA

http://www.cesifo-

group.de/pls/guestci/download/CESifo%20Working%20Papers%202002/CESifo%20Working

%20Papers%20July%202002/754.pdf

This paper conducts a comprehensive study of patent citations in patents granted to Belgian

corporate applicants by the United States and the European Patent Offices using qualitative

response variable analysis. The analysis uncovered different patterns of citations in patents,

which belong to different industrial classes. The studied citation data provides evidence of

inter- or intra-firm and inter- or intra-industry knowledge spillovers which are industry specific.

Bronwyn H. HALL, Adam JAFFE and Manuel TRAJTENBERG, RAND Journal of Economics,

Vol. 36, No. 1, Spring 2005, pp. 16–38, MARKET VALUE AND PATENT CITATIONS

http://elsa.berkeley.edu/~bhhall/papers/HallJaffeTrajtenberg_RJEjan04.pdf

We explore the usefulness of patent citations as a measure of the “importance” of a firm’s

patents, as indicated by the stock market valuation of the firm’s intangible stock of knowledge.

Using patents and citations for 1963–1995, we estimate Tobin’s q equations on the ratios of

R&D to assets stocks, patents to R&D, and citations to patents. We find that each ratio

significantly affects market value, with an extra citation per patent boosting market value by

3%. Further findings indicate that “unpredictable” citations have a stronger effect than the

predictable portion, and that self-citations are more valuable than external citations.


83

Emmanuel DUGUET and Megan MacGARVIE, September 2003, HOW WELL DO PATENT

CITATIONS MEASURE FLOWS OF TECHNOLOGY? EVIDENCE FROM FRENCH

INNOVATION SURVEYS


Patent citation data are used in a growing body of economics and business research on

technological diffusion. Research in this area uses “backward” citations to measure

technological knowledge acquired by the patenting entities studied. “Forward” citations

(citations to the firm’s patents made by other patents) have been interpreted as a measure of

the knowledge diffusing outward from the patenting entity. Until now, there exists little

evidence on whether or not patent citations are a good measure of knowledge flows. Our

paper assesses the legitimacy of using European patent citations as a measure of technology

flows. It uses information from the Community Innovation Survey (CIS) collected by the French

Service des Statistiques Industrielles (SESSI), which contain firms’ responses to questions

about their innovative activity. We show that patent citations are indeed related to firms’

statements about their acquisition and dispersion of new technology, but that the strength and

statistical significance of this relationship varies across geographical regions and across

channels of knowledge diffusion.

Jacques MICHEL, Bernd BETTELS, 2001, Scientometrics, Vol. 51, No. 1 (2001) 185–201,

PATENT CITATION ANALYSIS - A CLOSER LOOK AT THE BASIC INPUT DATA FROM

PATENT SEARCH REPORTS

http://www.akademiai.com/content/h74j50p35k266287/

The present paper focuses on some important requirements for understanding patent search

reports in view of their use for statistical analysis. It is pointed out and illustrated that the

comprehensiveness and the quality of a given search report may vary significantly as a

function of the patent office drawing up the report. These differences imply consequences with

respect to the safe use and interpretation of the data. The authors stress that a sound analysis

based on patent citation data can only be performed in a meaningful way if the analyst has a

minimum knowledge of the underlying search reports.

19. Patents in regions

Eurostat (European Commission), May 2011, PATENT STATISTICS AT EUROSTAT:

METHODS OF REGIONALISATION, SECTOR ALLOCATION AND NAME HARMONISATIO


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http://epp.eurostat.ec.europa.eu/portal/page/portal/product_details/publication?p_product_cod

e=KS-RA-11-008

Over the last decade, Eurostat regularly increased and improved the dissemination of patent

data with the production of new indicators on economic activities, basing its current production

almost exclusively on the Worldwide Statistical Patent Database PATSTAT, developed by the

European Patent Office (EPO). The core of the work is linked to the European Research Area

(ERA), and to the priorities of the Europe 2020 strategy. There is therefore a need to enhance

the information available in patent databases.

In that context Eurostat developed and implemented several innovative methodologies to be

applied on PATSTAT data. They relate to regionalisation of patentee and inventors addresses

(according to the NUTS classification), as well as sector allocation and name harmonisation of

applicants. Specifics on the developed methodologies and their results in terms of coverage

and accuracy are compiled in the present publication “PATENT STATISTICS AT EUROSTAT:

Methods for Regionalisation, Sector Allocation and Name Harmonisation”.

CHRIST Julian P., April 2010, GEOGRAPHIC CONCENTRATION AND SPATIAL

INEQUALITY: TWO DECADES OF EPO PATENTING AT THE LEVEL OF EUROPEAN

MICRO REGIONS

http://econstor.eu/bitstream/10419/36703/1/631009469.pdf

This paper contributes with empirical findings to the research on structural inequality and

geographic concentration of European inventorship activity at the level of European micro

regions. We analyze the spatial structure and dynamics of 43 technology fields (ISI-SPRU-

OST concordance) and 6 high-technology fields based on data on EPO patent applications

and EPO inventors for the reference period 1977-2004. Based upon OECD RegPAT database

(January 2009), we extract EPO patent applications (fractional counting) and inventor IDs (full

counting), which are spatially linked to 819 European micro regions (OECD TL3), covering the

EU-25, Switzerland and Norway. Besides standard descriptives, we compute Herfindahl-

Hirschman indices, location quotients and weighted locational and spatial GINI coefficients.

We confirm the hypotheses that (i) the technology fields under analysis differ in their overall

size with respect to the stock of EPO patent applications and inventors; (ii) the share of

regions with LQ > 1 has decreased compared to the share of regions with at least a single

patent application; (iii) the sample of European regions is characterized by highly concentrated

and unequally distributed technology fields; (iv) spatial inequality of EPO patenting and

inventor location has decreased significantly within the last two decades for most technology

fields. In this respect, our quantitative approach clearly depicts dispersion tendencies and

decreasing inequality, although structural dynamics differ between technology fields.


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Anja DETTMANN, Sidonia VON PROFF, 2010, INVENTOR COLLABORATION OVER

DISTANCE – A COMPARISON OF ACADEMIC AND CORPORATE PATENTS


The paper compares academic and corporate patents in Germany to shed light on the

geographical distribution of the inventors. The residences of the inventors show different

patterns in the two datasets. Furthermore, we analyze the spatial distance between inventors

for patents invented in collaboration and give insights into the distance’s change over a time

period of 14 years. The distance between collaborating inventors of corporate patents exceeds

that of inventors of academic patents. In spite of the rise of ICT and cheap passenger

transportation the collaboration distances have not increased. This supports earlier literature

on the importance of proximity in innovation.

Julian P. CHRIST, Revised version as of November 2009, THE GEOGRAPHY AND CO-

LOCATION OF EUROPEAN TECHNOLOGY-SPECIFIC CO-INVENTORSHIP NETWORKS

http://econstor.eu/bitstream/10419/30182/1/621679356.pdf

This paper contributes with empirical findings to European co-inventorship location and

geographical coincidence of co-patenting networks. Based on EPO co-patenting information

for the reference period 2000-2004, we analyze the spatial configuration of 44 technology-

specific co-inventorship networks. European co-inventorship (co-patenting) activity is spatially

linked to 1259 European NUTS3 units (EU25+CH+NO) and their NUTS1 regions by inventor

location. We extract 7.135.117 EPO co-patenting linkages from our own relational database

that makes use of the OECD RegPAT (2009) files. The matching between International Patent

Classification (IPC) subclasses and 44 technology fields is based on the ISI-SPRU-OST-

concordance. We confirm the hypothesis that the 44 co-inventorship networks differ in their

overall size (nodes, linkages, self-loops) and that they are dominated by similar groupings of

regions. The paper offers statistical evidence for the presence of highly localized European co-

inventorship networks for all 44 technology fields, as the majority of linkages between NUTS3

units (counties and districts) are within the same NUTS1 regions. Accordingly, our findings

help to understand general presence of positive spatial autocorrelation in regional patent data.

Our analysis explicitly accounts for different network centrality measures (betweenness,

degree, eigenvector). Spearman rank correlation coefficients for all 44 technology fields

confirm that most co-patenting networks co-locate in those regions that are central in several

technology-specific co-patenting networks. These findings support the hypothesis that leading

European regions are indeed multi-field network nodes and that most research collaboration is

taking place in dense co-patenting networks.


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Jarno HOEKMAN, Koen FRENKEN, Frank VAN OORT, 2008, COLLABORATION

NETWORKS AS CARRIERS OF KNOWLEDGE SPILLOVERS: EVIDENCE FROM EU27

REGIONS


The geography of innovation traditionally concentrates on localised knowledge spillovers, yet

neglects collaboration networks as a means to access knowledge outside the region. Using

publication and patent data for 1316 regions in the EU27 plus Norway and Switzerland, we

find that both localised knowledge spillovers and the knowledge spillovers stemming from

collaboration affect the innovative performance of regions. The results provide support for EU

policies aimed at creating European collaboration networks.

Jarno HOEKMAN, Koen FRENKEN, Frank VAN OORT, 2008, THE GEOGRAPHY OF

COLLABORATIVE KNOWLEDGE PRODUCTION IN EUROPE


We analyze inter-regional research collaboration as measured by scientific publications and

patents with multiple addresses, covering 1 316 NUTS 3 regions in 29 European countries.

The estimates of gravity equations show the effects of geographical and institutional distance

on research collaboration. We also find evidence for the existence of elite structures between

excellence regions and between capital regions. The results suggest that current EU science

policy to stimulate research collaboration is legitimate, but doubt the compatibility between EU

science policy and EU cohesion policy.

Stéphane MARAUT, Hélène DERNIS, Colin WEBB, Vincenzo SPIEZIA and Dominique

GUELLEC, June 2008, THE OECD REGPAT DATABASE: A PRESENTATION, STI

WORKING PAPER 2008/2, Statistical Analysis of Science, Technology and Industry


The OECD REGPAT database presents patent data that have been linked to regions

according to the addresses of the applicants and inventors. The data have been .regionalised.

at a very detailed level so that more than 2 000 regions are covered across OECD countries.

REGPAT allows patent data to be used in connection with other regional data such as GDP or

labour force statistics, and other patent-based information such as citations, technical fields

and patent holder’s characteristics (industry, university, etc.), thus providing researchers with

the means to develop a rich set of new indicators and undertake a broad range of analyses to

address issues relating to the regional dimension of innovation. By making regionalised patent

data available to all students interested in the field, the OECD aims to stimulate research and


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contribute to a better understanding of the regional dimension of innovation. In addition, the

methodology used for the construction of REGPAT is published, to give users the opportunity

to suggest modifications and thus contribute to improvements in the quality of REGPAT. The

full technical description of the REGPAT database as accessible to users is provided in annex.

Patent data provide unique insights into the outcome and characteristics of inventive activities,

including at regional level. They have limitations however, like all data sources, and should be

handled with methodological care.

Paola GIURI, Myriam MARIANI, December 2007, INVENTORS AND THE GEOGRAPHICAL

BREADTH OF KNOWLEDGE SPILLOVERS


This paper studies the geographical breadth of knowledge spillovers. Previous research

suggests that knowledge spillovers benefit from geographical proximity in technologically

active and rich regions more than elsewhere. An alternative view explains the geographical

breadth of knowledge spillovers as a function of the characteristics and personal networks of

the individuals. We test these two competing theories by using information provided directly by

the inventors of 6,750 European patents (PatVal-EU survey). Our results confirm the

importance of inventors’ personal background.

However, compared to previous research, we find that the level of education of the inventors is

key in shaping the geographical breadth of knowledge spillovers. Highly educated inventors

rely more on geographically wide research networks than their less educated peers. This holds

after controlling for the mobility of the inventors and for the scientific nature of the research

performed.

Differently, location matters only in the very rare regions in Europe that perform the bulk of the

research in the specific discipline of the inventors.

Olof EJERMO, March 2007, ARE QUALITY-ADJUSTED PATENTS MORE

GEOGRAPHICALLY CLUSTERED THAN RAW PATENT COUNTS? EVIDENCE USING

SWEDISH DATA

http://en.scientificcommons.org/33361036

Two ‘stylized facts’ about innovations form the underlying motivation for this paper. First,

various studies have found that innovations tend to be geographically concentrated. Secondly,

innovation data based on patent counts indicate that most patents have very low economic

value. It has also successfully been shown that ‘quality-adjusting’ patent data (by means of

e.g. citations received from later patents) bring them a great deal closer to the innovation

concept. At the same time, a large literature has developed which tries to evaluate the impact


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of regional innovativeness on factors such as regional growth and employment. This literature

is often hampered by lack of adequate data, but patent counts are regularly employed to

measure regional innovativeness. It therefore seems to be of importance to examine whether it

matters if patent data is quality-adjusted. A step in this direction is provided in this paper by

examining if patent data become more or less geographically concentrated after quality-

adjustment. I find that quality-adjusted patents are more geographically concentrated than raw

patent grants. This result is obtained analyzing all patents aggregated. When analyzing

different technologies separately, this result is retained for between 55-67 per cent of

technologies. One third of technologies instead become geographically more dispersed.

20. Patents and R&D (investments)

Malte MOSEL, JUNE 2010, COMPETITION, IMITATION, AND R&D PRODUCTIVITY IN A

GROWTH MODEL WITH SECTOR-SPECIFIC PATENT PROTECTION, CESIFO WORKING

PAPER NO. 3109

http://www.ifo.de/pls/guestci/download/CESifo%20Working%20Papers%202010/CESifo%20W

orking%20Papers%20June%202010/cesifo1_wp3109.pdf

Recent empirical studies suggest a need for a flexible patent regime responding to industry

characteristics. In practice, sector-specific modifications of patent strength already exist but

lack theoretical foundation. This paper intends to make up for this neglect by scrutinizing in

what direction industry characteristics influence optimal patent strength. It is found that patents

ought to be weaker, the more intense competition, the higher R&D productivity, and the more

intricate reverse engineering are. Unlike similar step-by-step innovation models of economic

growth, the model assumes Cournot competition and introduces an empirically substantiated

measure of sector differences in the ability to catch up with the technological leader. It is found

that for most empirically plausible cases the familiar inverted-U relation between patent length

and growth carries over to the Cournot set-up.

Gaétan de RASSENFOSSE, June 2010, PRODUCTIVITY AND PROPENSITY: THE TWO

FACES OF THE R&D-PATENT RELATIONSHIP

https://dipot.ulb.ac.be:8443/dspace/bitstream/2013/59648/1/2010-025-DERASSENFOSSE-

productivity.pdf

This paper tackles one of the most persistent criticism of patent statistics. Because not all

inventions are patented, the patent-to-R&D ratio reflects both a productivity effect (the number

of inventions created per unit of research input) and a propensity effect (the proportion of

inventions patented). We propose a solution to this identification problem. Our methodology


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uses information on the density of patent value and leads to results that are easy to interpret. It

is applied to a novel data set of priority patent applications in which each patent is fractionally

allocated to its inventors’ countries and to the technological areas to which it belongs.

Interestingly, it is frequently observed that an industry may exhibit a low number of patents per

unit of R&D in one country yet actually be more productive than the same industry in another

country where the patent-to- R&D ratio is higher.

Ana PÉREZ-LUÑO, Ramón VALLE-CABRERA, March 2010, HOW DOES KNOWLEDGE

MATTER PATENTING INVENTIONS?

http://www.upo.es/serv/bib/wpbsad/bsad1001.pdf

While there is robust empirical evidence that firm patenting is positively associated with

various measures of overall performance and competitiveness, less is known about what

determines the patenting choice. For this reason, this paper examines whether R&D

expenditure and the type of knowledge used in the invention determine the decision to patent.

With this aim, we use a sample of firms and the European Patent Office to analyse how the

combination of R&D expenditure and knowledge codifiability, observability and simplicity

influences the patent decision. Our results contribute to the literature and assist R&D

managers by showing that both R&D and codified knowledge have a positive impact on the

number of inventions patented by a firm, while observable knowledge has a negative impact

on patents. Furthermore, we find that the effect of R&D expenditure on the propensity to

patent inventions is negatively moderated by knowledge observability and simplicity.

Ion E. ANGHEL, Victor IANCU, 2010, INDUSTRIAL PROPERTY AS A STIMULATOR OF

SCIENTIFIC CREATION AND INNOVATION

http://ideas.repec.org/p/ror/wpince/100207.html

In modern times, when progress is made through knowledge and knowledge is predominantly

produced/used, industrial property rights, their protection and related specialized institutions

play a stimulating role. Therefore, this paper presents first the requirements for stimulating

scientific and technological creation and innovation in the European Research Area, in close

relation to industrial property rights. In this context, we assess the size of scientific research

and innovation in Romania in relation to industrial property rights. Considering the

requirements for stimulating scientific and technological creation and innovation, we deal with

issues on adapting and maintaining dynamism in law and institutional regulations, in order to

achieve convergence, in general, and convergence in the industrial property field, in particular.


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Angus C. CHU, September 2009, MACROECONOMIC EFFECTS OF INTELLECTUAL

PROPERTY RIGHTS: A SURVEY

http://mpra.ub.uni-muenchen.de/17342

This paper provides a survey on studies that analyze the macroeconomic effects of intellectual

property rights (IPR). The first part of this paper introduces different patent-policy instruments

and reviews their effects on R&D and economic growth. This part also discusses the

distortionary effects and distributional consequences of IPR protection as well as empirical

evidence on the effects of patent rights. Then, the second part considers the international

aspects of IPR protection. In summary, this survey draws the following conclusions from the

literature. Firstly, different patent-policy instruments have different effects on R&D and growth.

Secondly, there is empirical evidence supporting a positive relationship between IPR

protection and innovation, but the evidence is stronger for developed countries than for

developing countries. Thirdly, the optimal level of IPR protection should tradeoff the social

benefits of enhanced innovation against the social costs of multiple distortions and income

inequality. Finally, in an open economy, achieving the globally optimal level of protection

requires an international coordination (rather than the harmonization) of IPR protection.

Donja DARAI, Jens GROßER, Nadja TRHAL, March 2009, PATENTS VERSUS SUBSIDIES -

A LABORATORY EXPERIMENT

http://www.research-projects.uzh.ch/p13104.htm

This paper studies the effects of patents and subsidies on R&D investment decisions. The

theoretical framework is a two-stage game consisting of an investment and a market stage. In

equilibrium, both patents and subsidies induce the same amount of R&D investment, which is

higher than the investment without governmental incentives. In the first stage, the firms can

invest in a stochastic R&D project which might lead to a reduction of the marginal production

costs and in the second stage, the firms face price competition. Both stages of the game are

implemented in a laboratory experiment and the obtained results support the theoretical

predictions. Patents and subsidies increase investment in R&D and the observed amounts of

investment in the patent and subsidy treatment do not differ significantly across both

instruments. However, we observe overinvestment in all three treatments. Observed prices in

the market stage converge to equilibrium price levels.

Joanna POYAGO-THEOTOKY, Khemarat Talerngsri TEERASUWANNAJAK, February 2009,

R&D PRODUCTIVITY AND INTELLECTUAL PROPERTY RIGHTS PROTECTION REGIMES

http://ideas.repec.org/p/lbo/lbowps/2009_06.html


91

We study firms’ preferences towards intellectual property rights (IPR) regimes in a North-South

context, using a simple duopoly model where a ‘North’ and a ‘South’ firm compete in a third

market. Unlike other contributions in this field, we explicitly introduce the South’s capability to

undertake cost-reducing R&D, but maintain the South’s inferiority in utilizing and managing its

R&D. In contrast to traditional results, we show that the North may encourage lax IPR

protection provided that its South rival’s R&D productivity is sufficiently high, while the South

may find it in its best interest to strictly enforce IPR protection if its R&D productivity is low. In

this sense, our results do not support the idea of universal or uniform IPR protection regime. In

addition, we find that if firms are allowed to agree on any level of information exchange when

IPR protection is strictly enforced, such an exchange can always be established as long as

each firm is ensured that what it gets to utilize in return is greater than a half of what it gives to

its rival.

Jérôme DANGUY, Gaetan DE RASSENFOSSE and Bruno VAN POTTELSBERGHE DE LA

POTTERIE, 2009, THE R&D-PATENT RELATIONSHIP: AN INDUSTRY PERSPECTIVE, No

7/2009, EIB Papers from European Investment Bank, Economic and Financial Studies

http://www.eib.org/attachments/efs/eibpapers/eibpapers_2009_v14_n01_en.pdf#page=172

This paper re-visits the empirical failure to establish a clear link between R&D efforts and

patent counts at the industry level. It is claimed that the “propensity-to-patent” concept should

be split into an “appropriability propensity” and a “strategic propensity”. The empirical

contribution is based on a unique panel dataset composed of 18 industries in 19 countries

over 19 years. The results confirm that the R&D-patent relationship is affected by research

productivity, appropriability propensity and strategic propensity factors. The observed increase

in the propensity to file for patents is much stronger for supranational (that is, triadic or

regional) patents than for priority filings, suggesting that the current patent hype is essentially

the result of a globalization phenomenon.

Angus C. CHU, October 2007, ECONOMIC GROWTH AND PATENT POLICY:

QUANTIFYING THE EFFECTS OF PATENT LENGTH ON R&D AND CONSUMPTION


Is the patent length an effective policy instrument in stimulating R&D? This paper develops a

generalized variety-expanding growth model and then calibrates the model to the aggregate

data of the US economy to analyze the effects of extending the patent length. The numerical

exercise suggests that at the empirical range of patent-value depreciation rates, extending the

patent length beyond 20 years leads to only a very small increase in R&D despite R&D

underinvestment in the market economy. On the other hand, shortening the patent length can


92

lead to a significant reduction in R&D and consumption. This paper also makes use of the

dynamic general-equilibrium framework to examine the fraction of total factor productivity

(TFP) growth that is driven by R&D, and the calibration exercise suggests that about 35% to

45% of the long-run TFP growth in the US is driven by R&D. Finally, this paper identifies and

analytically derives a dynamic distortion of the patent length on saving and investment in

physical capital that has been neglected by previous studies, which consequently

underestimate the distortionary effects of patent protection.

Gaétan DE RASSENFOSSE and Bruno VAN POTTELSBERGHE DE LA POTTERIE, March

2008, A POLICY INSIGHT INTO THE R&D-PATENT RELATIONSHIP, CEB Working Paper N°

08/008

http://www.sciencedirect.com/science/article/pii/S0048733308002977

This paper investigates whether patent counts can be taken as indicators of macroeconomic

innovation performance. The empirical model explicitly accounts for the two components of

patenting output: research productivity and patent propensity. The empirical analysis aims at

explaining the `correct' number of priority filings in 34 countries. It confirms that the two

components play a substantial role as witnessed by the impact of the design of several

policies, namely education, intellectual property and science and technology policies. A major

policy implication relates to the design of patent systems, which ultimately induces, or allows

for, aggressive patenting strategies.

Shiferaw GURMU, Fidel PÉREZ-SEBASTIÁN, February 2007, PATENTS, R&D AND LAG

EFFECTS: EVIDENCE FROM FLEXIBLE METHODS FOR COUNT PANEL DATA ON

MANUFACTURING FIRMS

http://www.ivie.es/downloads/docs/wpasad/wpasad-2007-03.pdf

Hausman, Hall and Griliches (1984) and Hall, Griliches and Hausman (1986) investigated

whether there was a lag in the patent-R&D relationship for the U.S. manufacturing sector using

1970’s data. They found that there was little evidence of anything but contemporaneous

movement of patents and R&D. We reexamine this important issue employing new longitudinal

patent data at the firm level for the U.S. manufacturing sector from 1982 to 1992. To address

unique features of the data, we estimate various distributed lag and dynamic multiplicative

panel count data models. The paper also develops a new class of count panel data models

based on series expansion of the distribution of individual effects. The empirical analyses

show that, although results are somewhat sensitive to different estimation methods, the

contemporaneous relationship between patenting and R&D expenditures continues to be

rather strong, accounting for over 60% of the total R&D elasticity. Regarding the lag structure


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of the patents-R&D relationship, we do find a significant lag in all empirical specifications.

Moreover, the estimated lag effects are higher than have previously been found, suggesting

that the contribution of R&D history to current patenting has increased from the 1970’s to the

1980’s.

Rajneesh NARULA, Grazia D. SANTANGELO, 2007, LOCATION AND R&D ALLIANCES IN

THE EUROPEAN ICT INDUSTRY

http://ideas.repec.org/p/dgr/unumer/2007008.html

This paper shows empirically that in an intra-industry oligopolistic scenario the location of a

firm’s innovative activities plays an important role in determining its partner selection in R&D

alliances. Such a role is mainly attributed to a strategic use of R&D alliances as a means to

limit knowledge flows and protect competences, rather than to promote knowledge flows. By

drawing on a novel dataset matching alliances and patent data for the European ICT industry,

the econometric analysis shows that partners’ prior co-location (at both national and sub-

national regional level), previous ties and technological overlap matter in the choice of partner,

while common nationality has a negative impact on alliance formation.

Florence JAUMOTTE and Nigel PAIN, December 2005, FROM IDEAS TO DEVELOPMENT:

THE DETERMINANTS OF R&D AND PATENTING, OECD ECONOMICS DEPARTMENT

WORKING PAPERS NO. 457

http://www.oecd.org/officialdocuments/displaydocumentpdf/?cote=ECO/WKP(2005)44&doclan

guage=en

This paper uses panel regressions to investigate the effects of innovation policies and

framework factors on business R&D intensity and patenting for a sample of 20 OECD

countries over the period 1982-2001. Both sets of factors are found to matter; the main

determinants of innovativeness appear to be the availability of scientists and engineers,

research conducted in the public sector (including universities), business-academic links, the

degree of product market competition, a high level of financial development and access to

foreign inventions. The effect of direct public financial support for business R&D is generally

positive but modest, though it may larger for cash-constrained firms. Intellectual property rights

appear to increase patenting significantly, but have little impact on R&D spending. Finally, the

paper takes a closer look at the labour market for researchers, estimating jointly equations for

employment and wages. Although the supply of scientists and engineers is eventually

responsive to wage differentials, both with other professions and across countries, the

evidence suggests that it may difficult to raise significantly the real amount of domestic R&D in

the short run because the supply of researchers is relatively inelastic.


94

Jürgen JANGER, April 2005, THE RESEARCH AND DEVELOPMENT SYSTEM IN AUSTRIA

— INPUT AND OUTPUT INDICATORS

http://www.oenb.at/en/img/mop_2005_1_analyses3_tcm16-26926.pdf

This paper analyzes the efficiency of research and development activities in Austria in

comparison with other countries. Public and private R&D spending, which has been increasing

steadily for years, is evaluated against a set of performance indicators, such as the number of

scientific publications and patents. The efficiency of Austria’s R&D system is currently rated

‘average’. This may change in the future, given that productivity growth in the Austrian

economy is declining despite the continually rising research and development ratio. In his

conclusions, the author presents suggestions for increasing the efficiency of the system,

particularly in the areas of university education and research, in the light of the strong

interaction with the corporate sector.

Rachel GRIFFITH, Rupert HARRISON and John VAN REENEN, September 2004, HOW

SPECIAL IS THE SPECIAL RELATIONSHIP? USING THE IMPACT OF US R&D

SPILLOVERS ON UK FIRMS AS A TEST OF TECHNOLOGY SOURCING

http://ideas.repec.org/p/ifs/ifsewp/04-32.html

How much does US-based R&D benefit other countries? We test the hypothesis that foreign

firms locating inventors in the US benefit from "technology sourcing". In other words, do

foreign research labs located on US soil tap into US R&D spillovers? Using panels of British

and US firms matched to patent data we show that British firms who had established a high

proportion of US-based inventors by 1990 benefited disproportionately from the growth of the

US R&D stock over the next 10 years. We estimate that UK TFP would have been at least 5%

lower in 2000 (about $14bn) in the absence of the US R&D growth in the 1990s. By contrast,

the growth of the UK R&D stock did not appear to have a major benefit for US firms who

located R&D labs in the UK. The "special relationship" between the UK and the US appears

distinctly asymmetric.

Corinne LANGINIER and Gian Carlo MOSCHINI, February 2002, Working Paper 02-WP 293,

THE ECONOMICS OF PATENTS: AN OVERVIEW

http://www2.econ.iastate.edu/research/webpapers/paper_2061.pdf

In this paper, we review the economic effects of intellectual property rights and specifically

address the economics of the patent system. The production and dissemination of new

knowledge is fraught with market failures because knowledge is a public good. Patents

provide a second-best solution to the resulting appropriability problem. We review the main


95

benefits and costs of the patent system, focusing on the role that patents play in providing

incentives for innovation, in promoting the dissemination of knowledge, and in helping

technology transfer and commercialization of new technology. From a more normative

perspective, we address the questions of what the features of an optimal patent system are

and whether the patent system is socially desirable. We examine the problem of the optimal

length and scope of patent protection, both for the case of a single innovation and for the

richer case of cumulative innovations. Finally, we review the issues related to how the patent

system influences the market structure and research and development investments.

Zvi GRILICHES, January 1998, PATENT STATISTICS AS ECONOMIC INDICATORS: A

SURVEY, p. 287 - 343, in: R&D and Productivity: The Econometric Evidence, University of

Chicago Press, ISBN: 0-226-30886-3

http://www.nber.org/books/gril98-1

21. University patents/academic patents

Birgitte ANDERSEN and Federica ROSSI, March 2010, BEYOND BAYH-DOLE:

UNIVERSITIES AND THE USE OF PROPRIETARY AND NON-PROPRIETARY

INTELLECTUAL PROPERTY (IP) MARKETPLACES

http://www.dime-eu.org/working-papers/wp14/90

Building upon an original survey of universities in the United Kingdom, this paper brings an

original perspective to the debate on the motivations and effectiveness of academic patenting,

and on the exchange of intellectual property (IP) using different protection mechanisms. It

seeks to analyze the extent to which the assumptions underlying the legislation that

encourages the patenting of academic research outcomes on the part of universities (such as

the much debated Bayh-Dole Act in the US) are justified. It does this by exploring the

motivations (related to finance, Innovation, strategic relationships, competitive advantage)

underpinning the Universities’ choice to engage in IP marketplaces. The paper also explores

whether universities support the view, implicitly held by mainstream economics, that the patent

marketplace is efficient or works automatically. It does this by investigating the obstacles

(related to market search, transparency, contract negotiation and enforcement, as well as

regulation problems) that are encountered when exchanging IP.

By considering a wide range of IP marketplaces (patents, copyright, open source and Non-

patented technology) and IP governance forms (e.g. alternative licensing forms), the paper

builds a more complete picture of the activities and experiences of universities than that

provided by the existing literature on university knowledge transfer, which usually focuses on


96

just two main channels for IP transfer, namely patents and publications. This approach allows

us to investigate questions such as: are patent rationales related to enhanced knowledge

transfer and income generation also applicable to other non-proprietary IP? Do problems

underpinning the patent marketplace also affect other forms of IP? Does the use of different IP

marketplaces and of different IP governance forms confer specific advantages or obstacles to

Universities?

Antonio DELLA MALVA, Francesco LISSONI and Patrick LLERENA, February 2010,

INSTITUTIONAL CHANGE AND ACADEMIC PATENTING: FRENCH UNIVERSITIES AND

THE INNOVATION ACT OF THE 1999, WP n. 29

http://portale.unibocconi.it/wps/wcm/connect/resources/file/eb948f48986b80c/WP29_Dellamal

vaetal.pdf

The Innovation Act was introduced by the French government in 1999, with the aim of

encouraging academic institutions to protect and commercialize their scientists' inventions. We

explore the effects of the Act on the distribution of Intellectual Property Rights (IPRs) over

academic scientists' inventions. We find that before the Act, academic institutions had a strong

tendency to leave such IPRs in the hands of their main funders, namely public research

organizations (such as CNRS or INSERM), and business companies. After the introduction of

the Act, French academic institutions have increased their propensity to claim IPRs over their

employees' invention, mainly under the form of co-ownership with business companies. This

result varies with the technological class of the patent, the presence and age of a TTO within

the university, and the university size and type.

Francesco LISSONI, Peter LOTZ, Jens SCHOVSBO, Adele TRECCANI, March 2009,

ACADEMIC PATENTING AND THE PROFESSOR’S PRIVILEGE: EVIDENCE ON DENMARK

FROM THE KEINS DATABASE


Since 1957, the Professor’s Privilege allowed Danish professors to retain IP rights over the

results of their research. This changed in 2000, when Denmark – as the first of several other

countries ‐ abolished the Privilege and granted IP over research results to universities. We

show that in the first years following the abolition, a considerable amount of patenting activity

has moved out of the professors’ hands into those of their universities. We also show that the

bulk of academic patenting consists of inventions owned by business companies, and this is

holds true both before and after the privilege. In this respect, the Danish case conforms to the

European pattern as described in the recent literature and provides useful suggestions on the

likely effects of re‐distribution of IP rights between universities and their faculties.


97

Antonio MESSENI PETRUZZELLI, February 2009, UNIVERSITY-INDUSTRY R&D

COLLABORATIONS: A JOINT-PATENTS ANALYSIS


Empirical studies on R&D collaborations between universities and firms have mainly centred

their attention on universities and firms characteristics and strategies that favour the

establishment of collaborative agreements. In this paper, we extend the current research

framework investigating the role that specific relational attributes may play on the relevance of

such collaborations. Specifically, we focus on three relevant factors, namely technological

relatedness, national culture similarity, and prior collaborations ties between universities and

firms. We develop testable hypotheses about their impact on the innovative performance of

R&D university industry collaborations, and test them on a sample of 796 university-industry

collaborations, established by 27 universities located in 12 different European countries. Our

results suggest that innovation value has an inverted U-shaped relation with partners

technological relatedness. In addition, universities and firms belonging to similar cultural

contexts and having had previous ties are more able to achieve better innovative outcomes.

Magnus HOLMÉN, Daniel LJUNGBERG, February 2009, WHAT DO ACADEMICS DO? AN

OPPORTUNITY PERSPECTIVE ON UNIVERSITY LITERATURE


This paper investigates what academics do from an opportunity perspective by characterizing

industrial dynamics and economics of innovation literature in terms of how they study

universities and academics. Opportunities are characterized in terms of its sources and targets

and in terms of how the opportunities are identified and exploited. This framework is applied to

papers published in a set of leading journals, including Research Policy, Journal of

Technology Transfer and Industrial and Corporate Change. A main part of the literature

focuses on narrowly selected modes of exploitation activities, such as patenting and firm

creation, as well as characterizing university-industry interaction. Surprisingly little is known

about what academics do and how they behave, as the literature has not analyzed academic

behavior from a process perspective. The existing literature analyzes university output as if it

produces for product markets rather than analyzing the role and the nature of how academics

act as specialized service providers across a range of activities. This paper argues that this is

a serious shortcoming, since it hampers our understanding of universities and academics as

dynamic actors. In contrast to the current narrow focus on university entrepreneurship, the

paper suggests that universities and academics can be characterized in terms of their degree

of experimental behavior.


98

Daniel LJUNGBERG, Maureen MCKELVEY, February 2009, ON THE RELATIVE

IMPORTANCE OF FIRMS’ ACADEMIC PATENTS


This paper examines the relative technological impact of academic patents assigned to firms.

First, two, potentially serious, biases of the existing literature on the topic are brought forward;

a) there exists a selection bias when studying university-owned patents in Europe, due to the

relatively low share of these as compared to firm-owned and b) studying university-owned

rather than university-invented patents carries the implicit, and quite questionable, assumption

that academic inventions are substitutes rather than complements to industrial ones. Second,

a sampling approach including firms’ academic patents and a matched control sample is

suggested to overcome these biases. Third, an empirical study using this sampling approach

is presented.

Two samples have been collected, each composed of 220 patents, applied for at the

European Patent Office between 1985 and 2000. The academic patents have one or more

inventor(s) affiliated to a Swedish university, and are sampled from the KEINS database.

Forward patent citations are used as a proxy for the ‘importance’ or 'technological impact' of

the patents. This sampling method allows for an analysis of whether patents in the two

samples can be considered relatively more or less important.

The preliminary findings suggests no significant difference in technological impact between

firms' academic and non-academic patents. We find that in general academic involvement are

in deepening, rather than broadening, into technologies 'familiar' to the firm. This part of the

study will be more deeply explored.

Dirk CZARNITZKI, Katrin HUSSINGER, Cédric SCHNEIDER, 2009, WHY CHALLENGE THE

IVORY TOWER? NEW EVIDENCE ON THE BASICNESS OF ACADEMIC PATENTS,

Discussion Paper No. 09-029


Historically universities used to generate knowledge that was made available to the public at

no further cost, as the research was financed by the government, and thus by a country’s tax

paying inhabitants. The emergence of private universities and new laws on intellectual

property rights changed the common practice, though. While the main activities of universities

remain education and academic research that is disseminated through journal publication

activity, commercial activities are on the rise in public science. For instance, the U.S. Bayh-

Dole Act from 1980 enables universities (and small business) to claim property rights through

patent filings even if the underlying research was financed by public money. This trend poses


99

the question whether universities still contribute significantly to the amount of basic science

produced in an economy when becoming commercially active. While journal publications are

certainly targeting basic research questions, the content of academic patens is not

unambiguously of basic nature. If universities would move to more applied research, this could

have detrimental effects for total welfare in the economy. While often presumed in academic

literature and policy discussions there is little empirical evidence showing that academic

patents protect more basic inventions than corporate patents. This study provides new

evidence on the basicness of academic patents using professor patents for Germany linked to

patent opposition data from the European Patent Office (EPO). Patent oppositions are the

most important mechanism by which the validity of patents filed at the EPO can be challenged.

We argue that academic patents should be less likely to be subject to validity challenges if

they are more basic than corporate patents. Disputes about the validity of intellectual property

rights, as patent litigations and patent oppositions, have been interpreted by the scientific

literature as a legal mechanism to enhance patent quality and the effectiveness of the patent

system and as an indication for competition. In this paper, we follow the latter interpretation.

Previous literature has revealed that patents themselves are rather strategic tools for firms

than instruments for intellectual property protection. This evidence supports the interpretation

of legal disputes over patent validity as an indication for competition in product and technology

markets. Basic inventions, which are not immediately directed at a marketable product, are

less likely to threaten the current competitive position of companies than more applied

inventions as they are less likely to threat other firms’ position in product markets. In our

empirical analysis, we find that academic patents are opposed less frequently than a control

group of corporate patents. This suggests that academic patents cover rather basic inventions

with a low immediate commercial value not threatening current returns of potential patent

opposers in the corporate sector. The effect is weaker for academic patents in collaboration

with the business sector, which suggests that those patents are evaluated as more applied or

threatening by the business sector.

Sidonia VON LEDEBUR, Guido BUENSTORF, Martin HUMMEL, August 2009, UNIVERSITY

PATENTING IN GERMANY BEFORE AND AFTER 2002: WHAT ROLE DID THE

PROFESSORS’ PRIVILEGE PLAY?, ISSN 1864-7057

https://docs.google.com/viewer?url=http%3A%2F%2Fwww.econ.mpg.de%2Ffiles%2F2009%2

Fstaff%2FBuenstorf_2009-068.pdf

We examine ownership patterns of German university-invented patents before and after the

abolition of the ‘professors' privilege’ in 2002 to explore how the legal change affected

patenting activities. Our data show a shift from individually-owned and firm-owned patents to


100

university-owned patents, which becomes increasingly strong over the years. Differences in

the patent experience of inventors and universities further help explain the variance in

ownership patterns. Both experienced and inexperienced inventors are affected by the legal

change.

Antti-Jussi TAHVANAINEN, FINNISH UNIVERSITY TECHNOLOGY TRANSFER IN A WHIRL

OF CHANGES. – A Brief Summary –. Helsinki: ETLA, Elinkeinoelämän Tutkimuslaitos, The

Research Institute of the Finnish Economy, 2009, 17 p. (Keskusteluaiheita, Discussion papers,

ISSN 0781-6847; No. 1188).

http://www.etla.fi/files/2306_Dp1188.pdf

Finnish university technology transfer is currently caught in the turbulences of major changes

in the national innovation system. Three virtually simultaneous changes are of special

importance. The first is the massive on-going renewal of the Universities Act governing the

Finnish higher education system in its entirety. It was originally initiated to provide universities

with more financial and operational flexibility and autonomy and, thus, with better premises to

fulfil the three mandates (i) to educate, (ii) to conduct academic research, and (iii) to impact

societal welfare. The second change is the foundation of the so-called Strategic Centres for

Science, Technology and Innovation (Finnish acronym: SHOK) that aim at establishing and re-

enforcing long-term research cooperation between the academia and the Industry. The final

change is the enactment of the new University Inventions Act in early January 2007. The Act

provided universities with the rights of ownership to inventions made in sponsored research

that, according to the principle of the professor’s privilege, were considered property of the

respective academic inventors prior to the change. In the beginning of 2008 Etlatieto Ltd.

interviewed 11 of 20 research universities active in Finland to capture the potential impacts the

three changes might have on university technology transfer activities. The set of interviewees

comprised professionals conducting different tasks in the technology transfer units of

universities ranging from research directors to technology transfer officers to lawyers.

According to the results, the expected benefits of the renewal of the Universities Act mainly

comprise of the increasing financial flexibility of universities hoped to translate into a

proliferation of tools available for the transfer of university technology (support of start-ups,

investments etc.), and a general increase in the profile of technology transfer functions that

should alleviate their current deficiency in resources. Challenges regarding the Universities

Act, on the other hand, relate to the lack of administrative and business related expertise in

universities required to fulfil the up-coming tasks mandated by the Act, and the lack of

commitment on part of universities’ management resulting in insufficient resources. SHOKs, in

turn, are expected to enable longer project cycles, to reduce administrative burden, to


101

encourage the setting of scientifically more ambitious research objectives, as well as to

increase research collaboration and its efficiency. Challenges were identified to relate to

proposed IPR-practices potentially endangering the academic freedom of university research,

the incentive schemes of top researchers to participate in SHOK projects, the inefficiencies of

a large participant base, and the dangers of a strongly industry driven mode of co-operation to

academic values. Finally, the benefits of the University Inventions Act are expected to emerge

from the gradual dismantling of the “ivory tower of academe”, an increase in the amount of

received invention disclosures, and more efficient administrative practices in university

technology transfer functions. Perceived challenges, in turn, include interpretational difficulties

of the Act, the modest commitment of university management to university technology transfer

in general, increasing administrative burdens, and strong cultural differences between

researchers, industry and university administration.

Sidonia VON LEDEBUR, February 2009, UNIVERSITY-OWNED PATENTS IN WEST AND

EAST GERMANY AND THE ABOLITION OF THE PROFESSORS’ PRIVILEGE

ftp://137.248.191.199/RePEc/pum/wpaper/WP4.pdf

This paper analyses the development of universities’ patent applications in Germany before

and after the abolition of the ‘professors' privilege’ in 2002. By means of a database with all

patent applications of German universities with professors among the inventors (1990-2006),

systematic changes in the trend are investigated. There are contrasts in the patenting patterns

of universities with or without long patenting experience. A structural break at the point of the

new legislation is found only for universities without patent activities in the past. This indicates

the importance of collecting patenting experience and that the amount of patents is path-

dependent.

Joaquín M. AZAGRA-CARO, 2009, RECOGNISING THE VALUE OF BUSINESS PATENTS

WITH UNIVERSITY INVENTORS

http://ipts.jrc.ec.europa.eu/publications/pub.cfm?id=2279

Support to university patent ownership is a popular R&D policy initiative to promote effective

knowledge sharing. Yet the broader, unintentional, consequences of such support on the link

between public funding of university R&D and increased university-industry cooperation have

not been studied. Through regression models on the determinants of university-owned patents

in the EU and US, tentative results illustrate that the risk of negative consequences exists.

Complementing current metrics about university performance with statistics about business

patents with university inventors would help avoid such a risk and find definitive quantitative

evidence.


102

Makiko TAKAHASHI, René CARRAZ, March 2009, ACADEMIC PATENTING IN JAPAN:

ILLUSTRATION FROM A LEADING JAPANESE UNIVERSITY

http://trove.nla.gov.au/work/1002557

In April 2004, the Japanese government incorporated the national universities as “independent

administrative entities”. This important change in Japan’s research culture has allowed its

universities to gain higher control and oversight over their strategic development trajectories.

In this paper, we will present an analysis centered on the legislative changes concerning

intellectual property and their impact on Japanese universities. We will particularly focus our

attention on a leading Japanese research institution: Tohoku University. We will analyze the

different mechanisms that have been put in place to foster the use of patents by faculty

members. In that respect, we introduce a differentiation between university-owned and

university-invented patents, and put emphasis on the difference in patenting behaviors among

scientific disciplines. Finally, we argue that contractual research is a major channel for the

technology transfer of Japanese universities’ knowledge and findings.

Julien PÉNIN, February 2009, ON THE CONSEQUENCES OF UNIVERSITY PATENTING:

WHAT CAN WE LEARN BY ASKING DIRECTLY TO ACADEMIC INVENTORS?

http://ideas.repec.org/p/ulp/sbbeta/2009-04.html

This paper examines the consequences of university patenting by using an original source of

information: The point of view of French academic inventors, i.e. French university professors

who are also inventors of European patents. Via a survey we collected information about 280

French academic inventors. This enables us to put forward new insights with respect to the

effect of university patenting on the diffusion of scientific research, incentives to do basic

research, commercialization of university inventions and access to upstream knowledge. In

particular, the study suggests a trade-off between enabling the transfer of university inventions

to industry in some sectors and delaying the dissemination of scientific research. On the one

hand, most academic inventors acknowledge a lag in their publication process directly

attributable to the patent application but, on the other hand, in life science disciplines a large

majority of respondents who have had one of their inventions commercialized, believe that this

would not have been the case had a patent not been there.

Gustavo CRESPI, Pablo D'ESTE, Roberto FONTANA, Aldo GEUNA, December 2008, THE

IMPACT OF ACADEMIC PATENTING ON UNIVERSITY RESEARCH AND ITS TRANSFER,

SEWP 187

http://ideas.repec.org/p/icr/wpicer/01-2009.html


103

This paper contributes to the ongoing debate on the impact of academic patenting. On the

basis of CV information and two separate surveys, we provide the first empirical evidence for a

sample of UK academics in physics, chemistry, computer science and a subset of engineering.

The main contribution of this paper is twofold. First, our econometric results suggest that

academic patenting is complementary to publishing at least up to a certain level of patenting

output after which we found some evidence of a substitution effect. Second, our analysis of the

potential impact of patenting on the other channels of knowledge transfers seems to indicate

that patenting does not have a negative impact on the other channels of knowledge exchange.

We have found some positive correlation between the stock of patents and other channels of

knowledge transfer, however, also in this case, we have found that a substitution effect sets in

indicating a inverted U shape type of relationships between patenting and other knowledge

transfer channels.

Joaquín M. AZAGRA-CARO, October 2008, PATENTS OWNED BY PUBLIC RESEARCH

CENTRES: EU VS. US - UNIVERSITIES VS. PUBLIC RESEARCH ORGANISATIONS

http://www.epip.eu/conferences/epip03/papers/Azagra-Caro_Euracapat%201%20-

%20EPIP.pdf

Some literature has paid attention to the increase of university-owned patents in many EU

countries, following the same trend in the US. We build an indicator to compare between EU

and US university-owned patents in relative terms and both of them with public research

organisations (PRO)-owned patents. We find that EU universities have almost caught-up US

universities and EU PROs in patent ownership. We conclude that the challenge is to

understand the large differences between US and EU PROs. Our econometric estimations

show that while returns to scale are decreasing for university-owned patents, they are constant

for PRO-owned patents, and illustrate the possibility that none of them are compatible with

other alternatives for technology transfer.

Dirk CZARNITZKI, Katrin HUSSINGER, Cédric SCHNEIDER, July 2008, COMMERCIALIZING

ACADEMIC RESEARCH: THE QUALITY OF FACULTY PATENTING

ftp://ftp.zew.de/pub/zew-docs/dp/dp08069.pdf

The knowledge produced by academic scientists has been identified as a potential key driver

of technological progress. Recent policies in Europe aim at increasing commercially orientated

activities in academe. Based on a sample of German scientists across all fields of science we

investigate the importance of academic patenting. Our findings suggest that academic

involvement in patenting results in greater knowledge externalities, as academic patents

appear to generate more forward citations. We also find that in the European context of


104

changing research objectives and funding sources since the mid-90’s, the “importance” of

academic patents declines over time. We show that academic entrants have patents of lower

“quality” than academic incumbents but they did not cause the decline, since the relative

importance of patents involving academics with an existing patenting history declined over

time as well. Moreover, a preliminary evaluation of the effects of the abolishment of the

“professor privilege” (the German counterpart of the U.S. Bayh-Dole Act) reveals that this legal

disposition led to an acceleration of this apparent decline.

Antonio DELLA MALVA, Francesco LISSONI, Patrick LLERENA, May 2008, INSTITUTIONAL

CHANGE AND ACADEMIC PATENTING: FRENCH UNIVERSITIES AND THE INNOVATION

ACT OF THE 1999

http://ideas.repec.org/p/ulp/sbbeta/2008-09.html

Recent empirical work in the field of university-industry technology transfer has stressed the

importance of IPR-related reforms and university patenting has major forces behind the

success of US high-tech industry. European policy-makers have been tempted to explain the

poorer technological performance of their countries with the lower propensity of their academic

institutions to get engaged in patenting and commercializing their research results. As a

consequence, a number of measures have been taken to promote academic awareness of

IPRs, as part of more comprehensive policies in favour of academic commercialization and

entrepreneurship. This paper explores university patenting, and the related policies, in France.

We provide evidence that university patenting in that countries has been underestimated by

policy-makers’ perceptions: French academic scientists are in fact responsible for no less than

3% of patents by French inventors at the European Patent Office. However, only 10% of

academic-invented patents are owned by domestic universities, with the remainder assigned

both to firms and to Public Research Organizations (PROs). We then explore the impact of the

Innovation Act, passed in France in 1999. We find that the Act has significantly increased the

likelihood an academic patent to be assigned to a university rather than to a business

company. We also find, that the opening of a technology transfer office in a university appears

to have a stronger and more significant impact than the Act on the decision of universities to

retain IPRs over their scientists’ discoveries.

Nicolas VAN ZEEBROECK, Bruno VAN POTTELSBERGHE DE LA POTTERIE and

Dominique GUELLEC, 2008, PATENTS AND ACADEMIC RESEARCH: A STATE OF THE

ART



105

The sharp increase in academic patenting over the past 20 years raises important issues

regarding the generation and diffusion of academic knowledge. Three key questions may be

raised in this respect: What is behind the surge in academic patenting? Does patenting affect

the quality and quantity of universities' scientific output? Does the patent system limit the

freedom to perform academic research? The present paper summarizes the existing literature

on these issues. The evidence suggests that academic patenting has only limited effects on

the direction, pace and quality of research. A virtuous cycle seems to characterise the patent-

publication relationship. Secondly, scientific anti-commons show very little effects on academic

researchers so far, limited to a few countries with weak or no research exemption regulations.

In a nutshell, the evidence leads us to conclude that the benefits of academic patenting on

research exceed their potential negative effects.

Francesco LISSONI, January 2008, ACADEMIC INVENTORS AS BROKERS: AN

EXPLORATORY ANALYSIS OF THE KEINS DATABASE


Academic inventors are university scientists who appear as designated inventors of patents

whose assignee may be either a business company, their own academic institution, or a

governmental administration. The paper analyses their relationships entertained with co-

inventors, who may be either academic colleagues, students, or, very often, industrial

researchers. Gould’s and Fernandez’s (1989) definition of “brokerage” roles is adjusted to

patent data, and complemented with information drawn from the academic inventors’

publications and their answers to a short questionnaire. Only very few academic inventors are

found to hold brokerage positions. Those who do have a large number of patents, a strong

publication record and higher-than-average propensity to keep in touch with their business co-

inventors after patents, for information exchanges of all sorts. Some of them achieve influence

well beyond the walls of the Ivory Tower.

Thomas BRENNER, Sidonia VON LEDEBUR, 2008, ACADEMIC INVENTORS’ CHOICE OF

TRANSFER CHANNELS DEPENDENT ON COMMERCIALISATION EXPERIENCE – A

THEORETICAL MODEL

http://ideas.repec.org/p/pum/wpaper/2008-01.html

Academic inventions have to be transferred to industry to become an innovation. Scientists

face multiple options for this transfer, from informal knowledge transfers to patents, licences,

and spin-offs. These transfer channels require different efforts and inhibit different degrees of

complexity. We want to theoretically explain the inventor’s choice of a certain transfer channel.

Under the assumption that (i) dealing with complexity is similar to facing risk, and (ii) scientists


106

are risk averse, we show that the chosen transfer channels are path-dependent: with

increasing commercialisation experience inventors choose more complex channels, up to a

certain limit of complexity.

Daisuke KANAMA and Kumi OKUWADA, September 2007, A STUDY ON UNIVERSITY

PATENT PORTFOLIOS: PORTFOLIO OF PATENT APPLICATION FROM TOHOKU

UNIVERSITY

http://www.nistep.go.jp/achiev/abs/eng/mat147e/pdf/mat147ae.pdf

Recently the infrastructure of the intellectual property system and the formulation of the

associated rules have been established in universities. The number of joint research and

funded research projects are also increased, as well as the number of patent applications and

licenses from the national universities. However, the fact is that the whole patent application

activities have not necessarily been fully understood by their own researchers at individual

national universities prior to their conversion to independent administrative institutions.

Under this survey, a specific university is chosen as a model. Then, all the information related

to patent applications among the results of research and development carried out at the

university is collected and analyzed. The study aims to clarify the realities of intellectual

contributions of the university in patent applications by utilizing the information.

Elefthérios SAPSALIS, 2007, FROM SCIENCE TO LICENSE: AN EXPLORATORY

ANALYSIS OF THE VALUE OF ACADEMIC PATENTS


This paper analyses the industrial and entrepreneurial value of 334 patent families applied for

by six major Belgian universities. It identifies the value determinants underlying the patent

documents and highlights the positive and significant impact of collaboration and tacit scientific

knowledge of the inventors’ team on the probability to get licensed. It also shows that there are

technological differences between patents licensed to existing companies and the ones

licensed to spin-offs. It suggests that existing companies are more likely to license

technologies to be cited by academia when spin-offs exploit academic patents that are cited by

the industry. These results advocate that existing companies and start-ups are two different

valorisation patterns to commercialise different types of academic technologies. The paper

stresses also the importance of collaboration between public and corporate research teams in

order to get patent licensed. It pleads for a better management and valorisation scheme of

patents co-applied for by many academic assignees and draws attention on the need to focus

on academic researchers with a high scientific profile in terms of publications in order to

crystallize their tacit knowledge into valuable patents.


107

Elefthérios SAPSALIS, 2007, SCIENCE VS TECHNOLOGY: A FACULTY DILEMMA? 35

YEARS OF PATENTING AT THE SCHOOL OF ENGINEERING AND APPLIED SCIENCE OF

COLUMBIA UNIVERSITY


In the large and complex debate related to the creation, diffusion and protection of academic

research results, this paper intends to understand the characteristics of academics involved in

the knowledge creation as measured by publications and patents. Moreover, it aims to

produce some piece of evidence that it is possible to manage patenting activity without

jeopardizing publishing. Analysing the publishing and patenting activity of the 326 faculty

members of the School of Engineering at Columbia University between 1970 and 2005, we

find out that more than the Bayh-Dole Act, it is the implementation of the IP policy at Columbia

University that has created an incentive to patent at the engineering school. We also find out

that the probability and propensity to patent is influenced by the scientific production of a

researcher, his contacts with industry but also his mindset towards patenting. Analysing the

scientific productivity of the researchers, we confirm that heterogeneity in the career might

deter the productivity of a researcher. We find that scientific collaboration with industry and

technological collaboration on application-oriented projects with public or industrial partners

had a positive impact on the probability to be among the best scientists. Finally our results

suggest that patenting activity undertaken by Columbia University does not divert academics

from publishing and relay the recent findings of the literature.

Gustavo A. CRESPI, Aldo GEUNA, Bart VERSPAGEN, December 2006, UNIVERSITY IPRS

AND KNOWLEDGE TRANSFER. IS THE IPR OWNERSHIP MODEL MORE EFFICIENT?,

SEWP 154

http://ideas.repec.org/p/sru/ssewps/154.html

This paper contributes to the current debate on university patents and knowledge transfer at

two levels. First we present the results of the comparison of European and US academic

patenting systems, and show that the common perception that Europe is lagging behind the

US in terms of university patenting is far from being correct. Second, we develop an

assessment of the efficiency of the academic IPR ownership model. Specifically, we assess

whether university-owned patents in Europe are more often applied, and/or more economically

valuable, than patents that result from university research but are not owned by universities

(university-invented). Our analysis starts from the observation that in our sample of six major

European countries, about two-thirds of the patents that result (at least partly) from university

research, are not owned by universities (but instead are owned in large measure by private


108

firms). Given the different importance of Public Research Organisations (PRO) in the 6 EU

countries considered, we have done the same analysis also for the case of PRO-owned and

PRO-invented patents. A review of the theory of research joint ventures suggests that

ownership is the result of a bargaining game, in which the relative bargaining positions

depend, among other things, on characteristics of the inventive process. This is the starting

point for applying two separate statistical treatment models. Our results indicate that, after

correcting for observable patent characteristics, there are no significant differences between

university-owned and university-invented patents.

Martin MEYER, Puay TANG, February 2006, EXPLORING THE "VALUE" OF ACADEMIC

PATENTS: IP MANAGEMENT PRACTICES IN UK UNIVERSITIES AND THEIR

IMPLICATIONS FOR THIRD-STREAM INDICATORS

http://ideas.repec.org/p/sru/ssewps/143.html

Third-Stream activities have become increasingly important in the UK. However, valuing them

in a meaningful way still poses a challenge to science and technology analysts and policy

makers alike. This paper reviews the general literature on "patent value" and assesses the

extent to which these established measures, including patent citation, patent family, renewal

and litigation data, can be applied to the university context. Our study examines indicators of

patent value for short and mid-term evaluation purposes, rather than indicators that suffer from

long time lags. We also explore the extent to which differences in IP management practices at

universities may have an impact on the validity and robustness of possible indicators. Our

observations from four UK universities indicate that there are considerable differences

between universities as to how they approach the IP management process, which in turn has

implications for valuing patents and how they track activity in this area. In their current form,

data as collected by universities are not sufficiently robust to serve as the basis for evaluation

or resource allocation.

Chiara FRANZONI and Francesco LISSONI, 2006, ACADEMIC ENTREPRENEURSHIP,

PATENTS AND SPIN-OFFS: CRITICAL ISSUES AND LESSONS FOR EUROPE


The paper proposes a definition of “academic entrepreneur” which draws from the economics,

history, and sociology of science.

Academic entrepreneurs are scientists with a brilliant scientific record, who build their careers

through discipline-building, the creation and of new labs and teams, and an appetite for the

economic resources necessary to pursue those goals. Long-standing institutional features of

national university systems explain to what extent commercial activities may or may not help


109

academic entrepreneurs to progress in their careers. European policies for technology transfer

should address these features, rather than aiming straight at university patenting and firm

creation.

Stefano BRESCHI, Francesco LISSONI and Fabio MONTOBBIO, 2006, UNIVERSITY

PATENTING AND SCIENTIFIC PRODUCTIVITY. A QUANTITATIVE STUDY OF ITALIAN

ACADEMIC INVENTORS


Based on longitudinal data for a matched sample of 592 Italian academic inventors and

controls, the paper explores the impact of patenting on university professors’ scientific

productivity, as measured by publication and citation counts. Academic inventors (university

professors who appear as designated inventors on at least one patent application) publish

more and better quality papers than their colleagues with no patents, and increase their

productivity after patenting. Endogeneity problems are addressed using instrumental variables

and applying inverse probability of treatment weights. The beneficial effect of patenting on

publication rates last longer for academic inventors with more than one patent.

Joaquín M AZAGRA CARO, Ignacio FERNÁNDEZ DE LUCIO and Antonio GUTIÉRREZ

GRACIA, Research Evaluation, volume 12, number 1, APRIL 2003, UNIVERSITY PATENTS:

OUTPUT AND INPUT INDICATORS … OF WHAT?

http://www.ingenio.upv.es/en/node/5067#.T-HTP7U0PZU

This paper aims to clarify the nature of university patents as outputs of different types of

research and inputs of diverse instruments of interaction, focusing on the case of the

Polytechnic University of Valencia at departmental level. A patent production function tests

what kind of research gives rise to patents. Several funding functions show for which

instruments patents are a better input. University patents appear to be an output of costly and

long-term oriented research, either publicly or privately financed, and also the input of a certain

type of interaction — not through licensing but through signalling competencies. The fear that

university patents negatively affect the quality of research is not justified, as they are the

outcome of research at the frontiers of science. However, it is true that university patents only

stimulate interaction with those firms that have enough absorptive capacity. If interaction with

less capable firms is intended, other instruments are required.

Bhaven N. SAMPAT, David C. MOWERY, Arvids A. ZIEDONIS, 2002/2003, CHANGES IN

UNIVERSITY PATENT QUALITY AFTER THE BAYH-DOLE ACT: A RE-EXAMINATION

http://www.card.iastate.edu/research/stp/papers/Sampat-Mowery-Ziedonis.pdf


110

The Bayh-Dole Act permitted universities to retain rights to patents resulting from government

funded academic research, and encouraged university entry into patenting and licensing.

Though it is widely recognized to be a major change in federal policy towards academic

research, surprisingly little empirical analysis has been directed at assessing the impacts of

Bayh-Dole on the academy and on university-industry research relationships. An important

exception is the work of Henderson, Jaffe and Trajtenberg (1998) which examined the impact

of Bayh-Dole on the quality of university patents, as measured by the number of times they are

cited in subsequent patents. The authors found that the quality of academic patents declined

dramatically after Bayh-Dole, a finding that has potentially important policy implications. In this

paper, we show that their results are not robust to using a longer stream of citation data, i.e.

they are driven by truncation bias. This has important implications not only for thinking about

Bayh-Dole, but also for future work using patent citations as economic indicators.

Tom COUPÉ, ECARES, Université Libre de Bruxelles, 2000/2001, ACADEMIC R&D AND

UNIVERSITY PATENTS

http://student.ulb.ac.be/~tcoupe/patents1.pdf

Many studies have shown indirect effects of academic research by linking academic research

to firm patents. However, since the Bayh-Dole act, universities are allowed to patent inventions

that were funded by federal money and to retain the royalties that these patents generate. As

a consequence, universities now are interested in protecting their ‘profitable’ discoveries, just

like any commercial firm doing R&D. In this paper, we apply the econometric techniques

traditionally used to estimate the patent production function of firms on data for American

universities. We find that more money spent on academic research leads to more university

patents, with elasticities that are similar to those found for commercial firms.

22. Community patent

Jérôme DANGUY & Bruno VAN POTTELSBERGHE, 2011, COST-BENEFIT ANALYSIS OF

THE COMMUNITY PATENT

http://ideas.repec.org/p/ulb/ulbeco/2013-101071.html

For more than 40 years, governments and professional associations have acted, voted or

lobbied against the implementation of the Community Patent (COMPAT, officially called the

EU Patent). The econometric results and simulations presented in this paper suggest that,

thanks to its attractiveness in terms of market size and a sound renewal fee structure, the

COMPAT would drastically reduce the relative patenting costs for applicants while generating

more income for the European Patent Office and most National Patent Offices. The loss of


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economic rents (€400 million would be lost by patent attorneys, translators and lawyers) and

the drop of controlling power by national patent offices elucidate further the observed

resistance to the Community Patent.

Bruno VAN POTTELSBERGHE, March 2010, EUROPE SHOULD STOP TAXING

INNOVATION

http://ideas.repec.org/a/eee/worpat/v33y2011i1p16-22.html

The European Union failed to achieve its Lisbon agenda target of spending three percent of

GDP on research and development, and so, in the EU2020 strategy, has given itself another

decade to meet this goal. Meanwhile, the EU has been leapfrogged by China in terms of

business R&D spend. One key element to stimulate innovation and ultimately drive European

growth would be to create the long-awaited single EU patent. Today’s fragmented European

patent system is poor value for money and overly complex, not least because national patent

systems still have the last word over all European patents on their territory. After nearly 50

years of failure to create the EU patent, language issues and the design of a centralised patent

litigation court remain unresolved. The recent EU Council deal on an ‘enhanced’ European

patent system is potentially a step forward, though many problems remain unresolved.

Jérôme DANGUY, Bruno VAN POTTELSBERGHE, December 2009, COST-BENEFIT

ANALYSIS OF THE COMMUNITY PATENT

http://ideas.repec.org/p/bre/wpaper/366.html

For more than 40 years, governments and professional associations have acted, voted or

lobbied against the implementation of the Community Patent (COMPAT). The econometric

results and simulations presented in this paper suggest that, thanks to its attractiveness in

terms of market size and a sound renewal fee structure, the COMPAT would drastically reduce

the relative patenting costs for applicants while generating more income for the European

Patent Office and most National Patent Offices. The loss of economic rents (€400 million

would be lost by patent attorneys, translators and lawyers) and the drop of controlling power

by national patent offices elucidate further the observed resistance to the Community Patent.

Bruno VAN POTTELSBERGHE, June 2009, LOST PROPERTY: THE EUROPEAN PATENT

SYSTEM AND WHY IT DOESN’T WORK

http://www.bruegel.org/publications/publication-detail/publication/312-lost-property-the-

european-patent-system-and-why-it-doesnt-work/

The European patent system faces two broad challenges: a European one and a global one.


112

Within Europe the key challenge is fragmentation of the patent system, where national patent

offices and jurisdictions have the ultimate power to grant or invalidate patents, leading to

different results across countries and frequently to the opposite result to that arrived at by the

centralised procedure performed by the EPO (European Patent Office).

The global challenge is related to the explosion in patent applications worldwide, which is

causing backlogs at patent offices. While patent applications have been growing in number

fast at most patent offices, the backlog issue is first and foremost an American problem – the

US has a much greater backlog than Europe. The major consequences of these backlogs are

more uncertainty on the market due to several hundred thousand patents pending for lengthy

periods and a drop in quality, in both patent applications and in patents granted.

Bruno VAN POTTELSBERGHE, Jérôme DANGUY, April 2009, ECONOMIC COST-

BENEFITS ANALYSIS OF THE COMMUNITY PATENT

http://ec.europa.eu/internal_market/indprop/docs/patent/studies/compact-cost%20-benefit-

study-final_en.pdf

The objective is to provide a detailed analysis of the economic benefits generated by the

implementation of the Community patent (COMPAT) project. The COMPAT project has been

on the negotiation table from before the creation of the European Patent Convention in 1973.

Based on recent research output on the economics of the European patent system and on

new simulations, the present report provides detailed arguments supporting the

implementation of the COMPAT project. By modeling the maintenance rate for the COMPAT

with different hypothetical fee distribution keys, we simulate revenue to patent offices

generated by different renewal fee scenarios. We compare these calculations with the current

situation for European patents to show that the renewal fee income generated for the EPO and

nearly all NPOs will exceed the renewal fees from the current system for a future COMPAT

whose renewal fees correspond to existing costs for about 4 Member States. This therefore

shows that the COMPAT would:

• Allow to have an efficient patent system with an ‘acceptable’ relative price;

• Correct several incongruities that currently reduce the perceived and actual effectiveness of

the European patent system;

• Generate more renewal fees’ income for the EPO and for all NPOs, or nearly all NPOs,

depending on the adopted renewal fee schedule for the COMPAT.

Dietmar HARHOFF, February 2009, ECONOMIC COST-BENEFIT ANALYSIS OF A UNIFIED

AND INTEGRATED EUROPEAN PATENT LITIGATION SYSTEM

http://ec.europa.eu/internal_market/indprop/docs/patent/studies/litigation_system_en.pdf


113

The patent system in Europe is still incomplete. Appropriating returns from patented

technology is impaired by the fact that patent-holders may have to enforce their patent rights in

multiple courts. Moreover, third parties interested in showing that particular patent rights have

been granted erroneously are disadvantaged by having to initiate revocation proceedings in

multiple jurisdictions.

Given that the successful pursuit of these two objectives can generate welfare gains for the

European economy, a unified European patent litigation system has immediate appeal.

The current study seeks to provide approximate cost and benefit calculations in order to inform

policy-makers in Europe about the choices they face in this important field of public policy. The

study groups cost and benefit effects into the following categories: (i) effects from avoiding

duplication of litigation; (ii) effects from changes in the demand for litigation, induced by

changes in the cost structure; (iii) effects from changed incentives for patenting.

Towards performing an assessment of the first two effects, the report collects data from a

variety of sources in order to support the estimates and to test the plausibility of a number of

necessary assumptions. Given that no official data on the incidence, outcomes and cost of

patent litigation exist, an effort is made to triangulate data and estimates in order to

demonstrate that the approximations are justified.

The following results are particularly important. Avoiding duplication of infringement and

revocation cases is likely to generate large benefits for the European economy. The results

obtained here suggest that currently, between 146 and 311 infringement cases are being

duplicated annually in the EU Member States. By 2013, this number is likely to increase to

between 202 and 431 duplicated cases. Total private savings from having access to a unified

Patent Court in 2013 would span the interval between EUR 148 and 289 million.

An assessment of the operating costs of the proposed Patent Court is obviously subject to a

large number of caveats. Based on data from earlier efforts (in particular the Working Party on

Litigation set up under the auspices of the European Patent Organisation), an upper-bound

estimate for the operating costs of a court with a capacity of 940 cases indicates that the Court

would cause operating costs of EUR 27.5 million.

Hence, the cost-benefit assessment focusing on avoided duplication leads to a highly positive

evaluation of the proposal. Even if the low estimate of savings (EUR 148 million) is taken, the

new system would create substantial benefits and reach a benefit-cost ratio of 5.4. However,

this view may be unduly conservative, and the benefit-cost ratio could be as high as 10.5.

Additional benefits could flow in case of additional litigation activity, be it in terms of

infringement or revocation actions. The availability of a low-cost litigation path offered by a

unified Patent Court is likely to lead to additional activity from parties in countries which

currently do not use the European patent system extensively. Moreover, the cost level of


114

litigation in the unified Patent Court system is likely to be below the cost levels currently

observed in some Member States and parties in these Member States are also likely to

engage in more litigation activity in the medium-run. These effects will also contribute to

generate private and public benefits.

The above estimates and considerations are based on the assumption that the unified Patent

Court will offer litigation at roughly the same cost level as the three largest low-cost national

systems. In a robustness check, the report explores to what extent the gains from saved

duplication would be dissipated if the cost level were higher. The computations show that even

with a substantial average cost increase, benefit-cost ratios remain above one, and for most

scenarios considerably above one.

It is more difficult to predict cost-induced changes in the demand for litigation. The relevance

of such changes will depend on the level and type of costs imposed on users of the new

system. These will be mostly determined by the private costs for legal support and advice, but

also by the fees levied by the Court itself. Measures to contain the private costs to parties in

litigation are important, and the Presidency’s proposal includes a number of such measures

which are discussed in the report with respect to their impact. A particularly promising

measure is to admit representation of parties by specialized European Patent Attorneys.

Another measure of importance is the contribution from the Community budget and from

States which are not EU Member States to the Court’s budget, in order to keep fees at low

levels.

The report also discusses – in a qualitative manner – effects which emerge from changes in

patenting and litigation incentives. It is argued that effects will be beneficial if the unified patent

litigation system puts emphasis on fast and low-cost proceedings, high quality judgement, and

a fair balance between the legitimate interests of patent holders and alleged infringers. It is

emphasized that particularly strong positive welfare contributions can be expected if an

effective and rapid, low-cost revocation procedure is available. The latter feature should

provide an effective means against strategic and (possibly) frivolous litigation activity which

could be mounted in the future by “patent trolls”. The report also comments on particular

design choices in the Presidency’s proposal.

To summarize, this report recommends strongly that the Presidency should proceed in its

efforts to establish a unified and integrated patent litigation system for European patents and

future Community patents. For conservative estimates of the relevant parameters, the

economic benefits from such a system are likely to exceed the costs of the establishment and

operation of the new court by a large multiple of between 5.4 and 10.5. Moreover, with prudent

design choices it should be possible to implement a litigation system that will be balanced and

supportive of overall efforts to improve the quality of patents in Europe.


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Hanns ULLRICH, December 2006, NATIONAL, EUROPEAN AND COMMUNITY PATENT

PROTECTION: TIME FOR RECONSIDERATION

http://ssrn.com/abstract=963759

The completion of a Community system of unitary intellectual property protection has come to

a halt when the Commission's proposal for a Community Patent Regulation was shelved by

the Council on political grounds in late 2004. By contrast, under the auspices of the European

Patent Organization a draft European Patent Litigation Agreement has been set up with a view

to have it adopted by those Contracting States of the European Patent Convention (EPC),

which would volunteer for it. Given that conceptually both the Community patent project and

the European Patent Convention date back to the mid of the last century, and that due to

economic and technological change there is a good case to be made for a broad reform effort,

it is proposed to benefit from the present crisis of unification of patent law by undertaking a

review of the entire system with a view to establish a fundamentally modernized system of

protection. This should include the recognition of the role national patents have to play in an

integrated system of patent protection in Europe.

23. Patent fees/costs

Dietmar HARHOFF, Karin HOISL, Bruno VAN POTTELSBERGHE DE LA POTTERIE, March

2009, LANGUAGES, FEES AND THE INTERNATIONAL SCOPE OF PATENTING

http://econpapers.repec.org/paper/cprceprdp/7241.htm

This paper analyzes firms’ choices regarding the geographic scope of patent protection within

the European patent system. We develop an econometric model at the patent level to quantify

the impact of office fees and translation costs on firms’ decision to validate a patent in a

particular country once it has been granted by the EPO. These costs have been disregarded in

previous studies. The results suggest that both translation costs and fees for validation and

renewals have a strong influence on the behavior of applicants. The estimates are then

employed to simulate the impact of the London Protocol, a recent policy reform which reduces

translation requirements in the European patent system. National validations of patents

granted by the EPO are estimated to increase by 29%.

Dietmar HARHOFF, Karin HOISL, Bettina REICHL, Bruno VAN POTTELSBERGHE DE LA

POTTERIE, November 2007, PATENT VALIDATION AT THE COUNTRY LEVEL - THE ROLE

OF FEES AND TRANSLATION COSTS, 2007-12

http://epub.ub.uni-muenchen.de/2073/


116

One feature of the European patent system that is heavily criticized nowadays is related to its

complex fragmentation and the induced cost burden for applicants. Once a patent is granted

by the EPO, the assignee must validate (and often translate) it and pay the renewal fees to

keep it in force in each country in which the applicant seeks protection. The objective of this

paper is to assess to what extent validation and renewal fees as well as translation costs affect

the validation behavior of applicants. We rely on a gravity model that aims at explaining patent

flows between inventor and target countries within the European patent system. The results

show that the size of countries, their wealth and the distance between their capital cities are

significant determinants of patent flows. Validation fees and renewal fees further affect the

validation behavior of applicants. Translation costs seem to have an impact as well. The

important role played by fees suggests that the implementation of cost-reducing policy

interventions like the London Protocol would induce a significant increase in the number of

patents validated in each European country.

Bruno VAN POTTELSBERGHE DE LA POTTERIE, Didier FRANCOIS, 2006, WP-CEB 06-

002, THE COST FACTOR IN PATENT SYSTEMS

https://docs.google.com/viewer?url=http%3A%2F%2Fwww.uni-

lj.si%2Ffiles%2FULJ%2Fuserfiles%2Fulj%2Frazis_razv_projekti%2Fintelektualna_lastnina%2

F%25C5%25A0tudija-The%2520cost%2520factor%2520in%2520patent%2520systems.pdf

The objective of this paper is to assess whether and to what extent the cost of patenting

affects the demand for patents. The empirical analysis, which focuses on the patent systems

of the USA, Japan, and Europe during the year 2003, leads to the following methodological

and empirical observations: i) after the grant, the translation, validation and transaction costs

induced by an effective protection in several European countries witness a highly fragmented

and very expensive European market for intellectual property; ii) for a proper international

comparison, the size of the market and the average number of claims must be accounted for;

iii) when the cost per claim per capita (the 3C-index) is considered, a negative linear

relationship appears between the cost of patenting and the number of claims that are filed; iv)

for a patent designating 13 European countries, the 3C-index is about 10 (2) times higher than

in the US (Japanese) system (for process and translation costs up to the grant); v) The

European market being more than twice as large as the US market in terms of inhabitants, the

3C-index suggests that there would be a clear justification for higher nominal examination fees

at the EPO, that would ensure a rigorous granting process.


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24. Patent quality

Sterzi, Valerio (2013), PATENT QUALITY AND OWNERSHIP: AN ANALYSIS OF UK

FACULTY PATENTING

http://ideas.repec.org/a/eee/respol/v42y2013i2p564-576.html

The relationship between ownership structure and the quality of academic inventions has not

been deeply analysed, despite its relevance for the literature on IPR and university–industry

knowledge transfer. This paper fills the gap by using a novel dataset of academic patents in

the UK, both university-owned and corporate-owned for the period 1990–2001.

Justus BARON, Henry DELCAMP, May 2010, ASSESSING INDICATORS OF PATENT

QUALITY: COMPLEX VS. DISCRETE TECHNOLOGIES

http://hal-ensmp.archives-ouvertes.fr/docs/00/48/82/75/PDF/CWPS_2010-07.pdf

This article compares indicators of patent quality in complex and discrete technologies using

factor analysis and econometric methods. The application of common indicators such as

forward citations to complex technologies has repeatedly been put into question. We study the

interchangeability of indicators and their capacity to predict litigation on a sample of 9255

patents. Our results do not support the criticism. Even though there are significant differences

in the behavior of indicators between samples of complex and discrete patents, issues of

complex innovation do not seem to affect the interpretability of quality indicators. Consistently,

both forward citations and a compound quality indicator perform equally well for complex and

discrete technologies in predicting the likelihood of litigation.

Bruno VAN POTTELSBERGHE DE LA POTTERIE, May 2010, THE QUALITY FACTOR IN

PATENT SYSTEMS, No 2010_016, ECARES Working Papers

http://ideas.repec.org/p/eca/wpaper/2013-59650.html

This paper puts forward a new methodology that aims at comparing quality across patent

systems. Quality is defined as the extent to which patent offices comply with the legal

standards that rule patentability conditions (novelty, inventiveness, transparency). The

methodology consists in a two-layer analytical framework composed of "legal standards" and

their "operational design". Operational designs include several elements that frame the rigour

and transparency of the filtering processes. The in-depth analysis of these two layers for the

patent offices of the USA (USPTO), Japan (JPO) and Europe (EPO) lead to the following

conclusions. The operational designs’ components are interdependent and form a coherent

system. This systemic approach underlines that if legal standards are similar across countries,

their operational design are heterogeneous. The empirical evidence suggests that the EPO

provides higher quality services than the USPTO, the JPO being in an intermediate position.


118

These differences call for a multi-faceted convergence of patent systems before worldwide

mutual recognition and worksharing practices are to be put in place.

Yasuo NAKANISHI, Setsuo YAMADA, September 2008, MARKET VALUE AND PATENT

QUALITY IN JAPANESE MANUFACTURING FIRMS


We investigate the effect of quality of patents on the market value of firms represented by the

Tobin's q. We consider the number of objections as well as the number of citations. We

construct the database of patent stock, citation-weighted patent stock and objection-weighted

patent stock. Our analysis is pioneering work involving Japanese data, as we were unable to

find any pre-existing Japanese data that considered both truncation problems and quality of

the patent. Our study departs from Hall, Jaffe and Trajtenberg (2000) because of the

application of objections as well as the consideration of the quality of patent citations.

Jean Olson LANJOUW, Mark SCHANKERMAN, December 2002, RESEARCH

PRODUCTIVITY AND PATENT QUALITY: MEASUREMENT WITH MULTIPLE INDICATORS

http://sticerd.lse.ac.uk/dps/ei/ei32.pdf

We analyse the determinants of the decline in measured research productivity (the

patent/R&D ratio)using panel data on manufacturing firms in the U.S. for the period 1980-93.

We focus on three factors: the level of demand, the quality of patents, and technological

exhaustion. We first develop an index of patent 'quality' using detailed information on patents

in the U.S. in seven technology fields. Using a factor model, we construct a minimum-variance

index based on four patent characteristics and show that using multiple indicators substantially

reduces the measured variance in quality. We then show that research productivity at the firm

level is negatively related to the patent quality index and the level of demand, as predicted by

an optimizing model of R&D, and positively related to the stock market valuation of patented

innovations held by firms.

25. Protection of business methods (Financial patents)

Bronwyn H. HALL, Grid THOMA, Salvatore TORRISI, February 2009, FINANCIAL

PATENTING IN EUROPE


We take a first look at financial patents at the European Patent Office (EPO). As is the case at

the US Patent and Trademark Office (USPTO), the number of financial patents in Europe has

increased significantly in parallel with significant changes in payment and financial systems.


119

Scholars have argued that financial patents, like other business methods patents, have low

value and are owned for strategic reasons rather than for protecting real inventions. We find

that established firms in non-financial sectors with diversified patent portfolios own a large

share of financial patents at the EPO. However, new specialized technology providers in the

financial area also hold a number of such patents. Decisions on the financial patent

applications take longer and they are more likely to be refused by the patent office, suggesting

greater uncertainty over validity than for other patents. They are also more likely to be

opposed, which is consistent with the fact that their other economic value indicators are

higher.

Shahid PARVEZ, 2008, PROTECTION OF BUSINESS METHOD UNDER THE PATENT

SYSTEM: DEVELOPMENTS IN EU AND US

http://www.indlawnews.com/Display.aspx?23004e16-9252-4508-8a12-dedc813bdc8f

21st century is the age of computer and globalisation. In this age the branch of Intellectual

Proper is not lagging behind from any other branches of study. The person who works on a

particular subject and devote his or her time, skill and labour, then that concerned person, if

comes out which is something new, innovative and which is also capable of giving benefits to

public at large, then that particular person who comes out with some useful thing after the

process of his or her research, then the subject matter comes under the protection of patent

under the patent system. However, it must be noted here that the laws related to the patent is

not universal in the whole world. There are different laws in different countries that governs the

subject matter of the patents, through that it is decided that whether the particular thing or the

subject matter is capable of the patent protection or not. Furthermore, it is the onus on the

inventor or the particular person who approaches before the appropriate authority to get the

patent protection that his or her invention is capable of getting protection under the applicable

laws that govern the patentability criteria of the particular subject. The laws regarding patent in

United States (hereinafter referred to as US) and Europe (hereinafter referred to as EU) is

entirely different. In US section 101 governs the patentability criteria, whereas in EU, Article 52

is related to the patents. European Patent Convention (EPC) provides that the applicant can

file only one application to get the protection under the patent system, prevalent in EU,

however it must be noted that the different countries in EU have their different laws regarding

the patent. Here, this could be mentioned that the different applicable laws in different

countries, itself is in contravention of the European Patent Convention (EPC).

Stefan WAGNER, September 2004, BUSINESS METHOD PATENTS IN EUROPE AND

THEIR STRATEGIC USE – EVIDENCE FROM FRANKING DEVICE MANUFACTURERS


120

http://ideas.repec.org/a/taf/ecinnt/v17y2008i3p173-194.html

There has been a wide-spread misconception based on the imprecise wording of Art. 52 of the

European Patent Convention (EPC) that the protection of business methods by patents is

prohibited in Europe. This paper investigates the legal framework set by patent laws with

respect to the patentability of business methods, contrasting the situation in Europe and the

situation in the US. It is shown that in praxi business methods have never been excluded from

patentability in Europe. Further, 1,901 European patent applications relating to business

methods are found by identifying European equivalents to granted USPTO patents filed in US

Class 705 (i.e. business method patents). The computation of major patent indicators reveals

that European applications for business method patents differ from the average of all EPO

patent applications with respect to the number of claims, the number of references made and

the frequency of legal actions against granted patents. Additionally, a case study from the

franking device industry gives evidence of the strategic use of business method patents

leading to comparably high opposition rates against 44% of all granted patents.

26. Patent portfolios and venture capital investments

Carolin HAEUSSLER, Dietmar HARHOFF, Elisabeth MÜLLER, January 2009, TO BE

FINANCED OR NOT … - THE ROLE OF PATENTS FOR VENTURE CAPITAL FINANCING

http://ideas.repec.org/p/trf/wpaper/253.html

This paper investigates how patent applications and grants held by new ventures improve their

ability to attract venture capital (VC) financing. We argue that investors are faced with

considerable uncertainty and therefore rely on patents as signals when trying to assess the

prospects of potential portfolio companies. For a sample of VC-seeking German and British

biotechnology companies we have identified all patents filed at the European Patent Office

(EPO). Applying hazard rate analysis, we find that in the presence of patent applications, VC

financing occurs earlier. Our results also show that VCs pay attention to patent quality,

financing those ventures faster which later turn out to have high-quality patents. Patent

oppositions increase the likelihood of receiving VC, but ultimate grant decisions do not spur

VC financing, presumably because they are anticipated. Our empirical results and interviews

with VCs suggest that the process of patenting generates signals which help to overcome the

liabilities of newness faced by new ventures.

JESPER LINDGAARD CHRISTENSEN, 2008, THE IPR SYSTEM, VENTURE CAPITAL AND

CAPITAL MARKETS – CONTRIBUTIONS AND DISTORTIONS OF SMALL FIRM

INNOVATION?


121


This study explores how capital markets, exemplified by venture capital, and recent trends in

the patent system may influence innovation activity and the financing of small businesses.

Specifically it is evaluated if there are costs and distortions of incentives related hereto.

Additionally, the positive contribution of venture capital in the patenting process is investigated.

It is found that trends at a macro economic level is nowadays of major importance for the

patenting and innovation behaviour and financing of firms. Patenting has increased in scale,

scope and trade volume, patents have become a strategic asset to an extent that may de-link

it from innovation activities. The IPR-system may render distortions of innovation activities

facilitated by these trends. These distortions may impose costs on the overall function of the

innovation system, costs that are unequally distributed among firms as small firms are bearing

most of the burdens.

The results points to new perspectives on strategy that are important to management of firms

and investment funds.

Mario W. CARDULLO, 2004, INTELLECTUAL PROPERTY – THE BASIS FOR VENTURE

CAPITAL INVESTMENTS

http://www.wipo.int/sme/en/documents/venture_capital_investments.htm

While technology has been seen as one of the engines for the dramatic economic growth and

productivity the United States has experienced over the last several decades an underlying

factor has been the strength of the intellectual property developed during that period. It is the

intellectual property that provided the basis for investors to place their resources at risk.

Intellectual property is an integral part of value creation in a technology-based enterprise and

as such is a critical element in obtaining venture capital for SMEs. The appropriate use of the

intellectual property system is a powerful tool for competition, stability and mitigation of risks

on capital investments.

27. Patents filed for other motives than innovation

Angus C. CHU, Yuichi FURUKAWA, August 2010, ON THE OPTIMAL MIX OF PATENT

INSTRUMENTS


A special characteristic of the patent system is that it features multiple patent-policy levers that

can be employed by policymakers. In this study, we develop a quality-ladder model to analyze

the optimal mix of patent instruments. Specifically, we consider (a) patent breadth and (b) the

division of profit in research joint ventures. We analytically derive optimal patent policies and


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then calibrate the model to quantitatively evaluate the welfare gain from optimizing both patent

instruments as compared to optimizing only one patent instrument. In summary, we find that

the welfare gain can be substantial.

Justus BARON, Henry DELCAMP, May 2010, STRATEGIC INPUTS INTO PATENT POOLS

http://hal-ensmp.archives-

ouvertes.fr/docs/00/48/82/72/PDF/BARON_DELCAMP_Strategic_Inputs_into_Patent_Pools_

CWP_2010-05.pdf

This article explores what factors determine the decision of a patent pool to accept new inputs.

We propose a dynamic analysis of 1337 U.S. patent inputs into 7 important pools. This

analysis highlights a trade-off between firm and patent characteristics as the determinants of

inclusion of patents into pools. For instance we prove that firms already member of the pool or

holding large patent portfolios are able to include lower quality patents. These findings can be

explained both by bargaining power and information asymmetry. In particular, as measured by

a new indicator, insiders and firms practicing the technology file patents that are better aligned

with the criteria of essentiality.

Dominique GUELLEC, Catalina MARTINEZ and Pluvia ZUNIGA, December 2009, PRE-

EMPTIVE PATENTING: SECURING MARKET EXCLUSION AND FREEDOM OF

OPERATION


We investigate statistically the characteristics, functioning and incidence of pre-emptive

patenting, defined as patent filings whose main effect is to hamper the grant of other patents.

Patent applications can be used to prevent the grant of exclusive rights on markets and

technologies to others in order to ensure freedom of operation to their holder or keep patent-

less competitors out of the market. Combining data from examination outcomes and prior art

at the European Patent Office (EPO), we develop a methodology to identify pre-emptive patent

applications. We find evidence of pre-emption associated to patent applications cited as

compromising patentability while being deemed non inventive. Furthermore, amongst them,

those which are withdrawn by the applicant have the strongest pre-emptive power. The

coincidence of low inventiveness and high pre-emptive impact supports the idea that some of

these patents may be strategically designed by their applicants to block patenting by others.

Patrick F.E. BESCHORNER, June 2009, DO SHORTER PRODUCT CYCLES INDUCE

PATENT THICKETS?



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The traditional argument that shorter product cycles favor trade secret over patenting is

reviewed. A game theoretic model provides an argument that shorter product cycles can

induce firms to file more patent applications. The firms may be trapped in a prisoners' dilemma

where all firms would jointly prefer to patent less and to not have a patent thicket. If firms start

applying for patents on technologies which are not yet mature in order to cover ideas that may

eventually turn successful, this may create a patent thicket. The transition into a situation

where firms start patenting many ideas instead of single mature technologies is initiated and

accelerated when network effects are present or patents exhibit a blocking property.

Colleen V. CHIEN, April 2009, OF TROLLS, DAVIDS, GOLIATHS, AND KINGS:

NARRATIVES AND EVIDENCE IN THE LITIGATION OF HIGH-TECH PATENTS


While each patent dispute is unique, most fit the profile of one of a limited number of patent

litigation stories. A dispute between an independent inventor and a large company, for

instance, is often cast in "David v. Goliath" terms. When two large companies fight over

patents, in contrast, they are said to be playing the "sport of kings." Some corporations engage

in "defensive patenting" in order to deter others from suing them. Patent licensing and

enforcement entities who sue have been labelled "trolls". Finally, observers of the patent

system call the use of patent litigation to impose or exploit financial distress "patent predation."

These stories, routinely invoked by the press, advocates, and academics, shape public

understanding of the patent system. In this Article, I describe, then match, these stories to data

on patent litigations to determine which types of suits are most prevalent. I focus exclusively

on the litigation of high-tech patents, covering hardware, software, and financial inventions,

using data from the Stanford Intellectual Property Clearinghouse for cases initiated in U.S.

District Courts from January 2000 through March 2008.

The data shows that the reality is more complicated than the rhetoric regarding patent

litigation. For instance, many blame nonpracticing entities (“NPEs”) for a majority of the

problems with the patent system. But they bring only a minority of patent suits: 17% of high-

tech patent suits in the last eight years. However, NPEs often name multiple defendants and

sometimes, rather than sue, are sued, for declaratory judgment (DJ). Counting suits based on

the number of defendants and including DJ cases, the NPE share rises to 28% of all high-tech

patent suits. This average reflects an increase in NPE suits as a proportion of all suits over an

eight-year period, from 22% in 2000-2001 to 36% from 2006 to March 2008, counting

defendants, or from 10% to 20%, counting cases. I also report the variation by industry based

on the absolute number of suits - the share of financial patent NPE suits (26%) was nearly


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triple that of hardware patent NPE suits (9%). These numbers provide a richer context for

understanding the NPE phenomenon.

Another perception of the patent system is that large companies are reluctant litigants,

carefully constructing portfolios of patents to avoid going to court. The practice of "defensive

patenting" has been well-documented and theorized. Yet, I found that public and large private

companies initiated 42% of all lawsuits studied, 28% of the time against other large companies

- the largest single category. They also defend against many other suits, brought by NPEs,

small inventors, and individuals. These data suggest that defensive patenting, which is

supposed to keep large firms out of court, is at least an incomplete - and perhaps a failing -

strategy for many companies.

This Article also reports on the other major narratives of patent litigation. 4% of the suits were

initiated by individual inventors (David v. Goliath), 18% of the suits were brought by small

private companies against public or large private ones (small v. large), 16% pit one small- or

medium-sized company against another (limited stakes), and in 8% a large firm sued a small

one (predation profile). These and other findings provide a snapshot of patent litigation that

should both inform current efforts to reform the patent system and serve as a basis for further

investigation into its functioning

Joachim HENKEL, Florian JELL, April 2009, ALTERNATIVE MOTIVES TO FILE FOR

PATENTS: PROFITING FROM PENDENCY AND PUBLICATION


Many patent applications lapse before they are reviewed by patent examiners. In this paper

we analyze how even a lapsed patent application yields benefits to the applicant. We argue

that these benefits are attributable to pendency and publication of patent applications. Based

on an analysis of all direct first filings at the German patent office between 1986 and 2000 we

find that more than 20% of all applications are left pending for the maximum of seven years

before examination is requested or the application is deemed to be withdrawn. Our findings,

which are supported by 25 interviews with inventors, indicate that firms keep patents pending

in order to gain time for evaluating if an exclusion right is worth its cost and to create insecurity

for competitors. Further 2% of all applications could turn out to have defensive publishing as

their sole purpose, that is, the publication of inventions with the purpose of creating prior art. In

this way, firms secure freedom to operate (FTO), which is a central precondition for

appropriating profits from own-used inventions. This finding gives an indication that, for all

other applications, the share of their value attributable to creating FTO might be considerable.


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Florian SCHUETT, March 2009, INVENTORS AND IMPOSTORS: AN ECONOMIC ANALYSIS

OF PATENT EXAMINATION, EUI ECO Working paper 2009/28

http://cadmus.eui.eu/handle/1814/12051

The objective of patent examination is to separate the wheat from the chaff. Good applications

- those satisfying the patentability criteria, particularly novelty and nonobviousness - should be

accepted, while bad applications should be rejected. How should incentives for examiners be

designed to further this objective? This paper develops a theoretical model of patent

examination to address the question. It argues that examination can be described as a moral-

hazard problem followed by an adverse-selection problem: the examiner must be given

incentives to exert effort (looking for evidence to reject), but also to truthfully reveal the

evidence he finds (or lack thereof). The model can explain the puzzling compensation scheme

in use at the U.S. patent office, where examiners are essentially rewarded for granting patents,

as well as variation in compensation schemes across patent offices. It also has implications for

the retention of examiners and for administrative patent review.

Nicolas VAN ZEEBROECK, January 2009, FILING STRATEGIES AND THE INCREASING

DURATION OF PATENT APPLICATIONS


It has long been implicitly assumed that the roaring backlogs experienced by most patent

offices around the world – and harshly criticized by many patentees – are a mere mechanical

consequence of surging numbers of patent filings. However, different voices suggest that the

patent system may sometimes be gamed by an applicant in order precisely to delay the time

when a decision will be taken as to the patentability of his application. By empirically showing

the impact of several procedural options chosen by patentees in filing their applications at the

EPO, this paper clearly demonstrates that this possibility is real, and probably not anecdotal.

Deliberate or not, the main consequence of several procedural options is clearly to delay the

grant decision. Why and how firms could win any benefit from such strategies can only be

guessed, but whether such behaviours are legitimate or not, socially desirable or not, remains

an open question.

Joachim HENKEL, Markus G. REITZIG, September 2007, PATENT SHARKS AND THE

SUSTAINABILITY OF VALUE DESTRUCTION STRATEGIES


Patent sharks (a.k.a. patent trolls) appropriate innovation rents by threatening to patent-block

other players' R&D-related value creation. Scholars have identified two inefficiencies in legal

practise (patentee-friendly injunctions and the granting of excessive damage awards) as


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drivers of these 'destructive' strategies, suggesting that policy changes can suppress the shark

business in the future. Modelling interactions between sharks and manufacturers within a

biform game, we show formally that the shark problem is more subtle from a theoretical

managerial perspective and sustainable to policy changes in part. Patent extortion will remain

a viable strategy in technologically crowded industries when sharks choose patents on

inventions that (1) can be invented around rather easily before infringement, but (2) are

sufficiently sophisticated to be upheld in court and (3) create significant mid-term switching

costs for manufacturers after infringement. By presenting original data on all publicly reported

cases of patent shark attacks, we provide empirical indications a) that different sharking

strategies as predicted by theory exist in practise and b) that a significant share of professional

shark firms already pursue strategies that are likely to remain sustainable after legal changes.

We discuss implications for management theory in the area of innovation strategy and

business strategy more broadly.

Knut BLIND, Katrin CREMERS, Elisabeth MUELLER, January 2007, THE INFLUENCE OF

STRATEGIC PATENTING ON COMPANIES’ PATENT PORTFOLIOS

http://opus.zbw-kiel.de/volltexte/2007/5501/pdf/dp07013.pdf

This paper analyses whether strategic motives for patenting influence the characteristics of

companies’ patent portfolios. We use the number of citations and oppositions to represent

these characteristics. The investigation is based on survey and patent data from German

companies.

We find clear evidence that the companies’ patenting strategies explain the characteristics of

their patent portfolios. First, companies using patents to protect their technological knowledge

base receive a higher number of citations for their patents. Second, the motive of offensive –

but not of defensive – blocking is related to a higher incidence of oppositions, whereas

companies using patents as bartering chips in collaborations receive fewer oppositions to their

patents.

James F. MCDONOUGH III, January 2007, THE MYTH OF THE PATENT TROLL: AN

ALTERNATIVE VIEW OF THE FUNCTION OF PATENT DEALERS IN AN IDEA ECONOMY


A new breed of companies has emerged, and they are being called patent trolls. A patent troll

is a person or entity who acquires ownership of a patent without the intention of actually using

it to produce a product. Instead, it licenses the technology to an entity that will incorporate the

patent into a product, or it sues an entity it believes has already incorporated the technology in

a product without permission. The government, corporate America, and the media are


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fervently acting against these trolls. New proposed legislation, a blizzard of Supreme Court

cases involving trolls, and endless newspaper and magazine articles are all trumpeting the

same story line: Patent trolls are bad for society and must be stopped.

This article suggests that patent trolls are actually good for the patent system. Patent trolls are

more accurately described as patent dealers because they act as market intermediaries in the

patent market. Once the activities of patent dealers are isolated from other distinct problems

that have been identified with the patent system, specifically the issuance of poor quality

patents and the problem of the patent thickets, it becomes clear that the emergence of patent

dealers marks a stage in the natural evolution of the patent market. Patent dealers make the

patent market more efficient by realigning market participant incentives, making patents more

liquid, and clearing the patent market. The article concludes by rebutting the common

complaints that patent trolls stunt innovation and spur unnecessary litigation.

28. Patents and developing countries

K. M. GOPAKUMAR, PRODUCT PATENTS AND ACCESS TO MEDICINES IN INDIA: A

CRITICAL REVIEW OF THE IMPLEMENTATION OF TRIPS PATENT REGIME

http://www.bepress.com/ldr/vol3/iss2/art11

In 2005, India amended its Patents Act, 1970 to introduce TRIPS compliant product patent

regime. Generally speaking, law and policy makers in India during the time of the amendment

were confronted with two major concerns viz. the future of the Indian pharmaceutical industry

and access to affordable medicines in India and other developing countries. To address these

concerns India along with many other developing countries attempted to incorporate TRIPS

flexibilities in their domestic law. However, the success of the TRIPS flexibilities in addressing

the question of access to affordable medicines mainly depends on three factors: a) the

incorporation of flexibilities in the domestic law; b) the manufacturing capability of a country;

and c) the political will to use the public interest safeguards provided in the domestic law.

There are only a few countries like India, which satisfy the above-mentioned conditions to a

certain extent. This article examines whether these premises hold true after five years into the

implementation of the TRIPS compliant patent system in India. In this context the paper

identifies and analyzes the legal, policy and institutional challenges that India is currently

facing in the implementation of TRIPS flexibilities. It also identifies the main legal, policy and

institutional disconnect in the implementation of TRIPS flexibilities in India. It argues that to

effectively use TRIPS flexibilities to address access to affordable medicines require changes in

three areas viz. law, policy and institutions. It clearly shows that mere incorporation of TRIPS


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flexibilities in the domestic legislation alone is not enough and the domestic legislation needs

to be complemented with policy and institutional framework.

Belton M. FLEISHER, Mi ZHOU, January 2010, ARE PATENT LAWS HARMFUL TO

DEVELOPING COUNTRIES? EVIDENCE FROM CHINA

http://www.econ.ohio-state.edu/pdf/fleisher/wp09-07.pdf

Has upgrading and enforcing its patent laws slowed China’s economic growth? The answer

we draw from detailed analysis of provincial aggregate data covering roughly the period 1990

through 2007 is strongly negative. An upper bound estimate is that the patent laws contributed

nearly two-thirds of China’s TFP growth over the period following adoption of the 1993 patent

law. A more plausible, difference-in-difference, estimate of the impact of the 1993 and 2001

patent laws is that in their absence China’s TFP growth over the period 1993-2007 would have

been marginally smaller after we control for the impacts of Deng Xiaoping’s “South Trip” and

China’s accession to WTO. The patent laws are estimated to have increased TFP growth

through increasing the rate of new technology embodied in physical capital and also through

intangible capital associated with FDI inflows. Virtually none of the laws’ impact on TFP growth

can be directly associated with increased R&D, although R&D is strongly positively correlated

with promulgation of the patent laws. The insignificant, or possibly negative, impact through

R&D may be due to inadequate GDP accounting for R&D expenditure in GDP and investment

accounts.

Belton M. FLEISHER, Mi ZHOU, August 2009, ARE PATENT LAWS HARMFUL TO

DEVELOPING COUNTRIES? EVIDENCE FROM CHINA

http://www.econ.ohio-state.edu/pdf/fleisher/wp09-07.pdf

Has upgrading and enforcing its patent laws slowed China’s economic growth? The answer

we draw from detailed analysis of provincial aggregate data covering roughly the period 1990

through 2007 is strongly negative, but understanding the channels through which stricter

protection of intellectual property rights has contributed to more rapid productivity growth is

elusive. Our best estimate of the direct impact of the 1992 and 2001 patent laws on TFP

growth amounts to a significant share of the average TFP growth rate over the period, but we

cannot be sure that we have isolated the impact of the patent laws on TFP growth from those

of Deng’s famous “South Trip” and entry into WTO. We estimate that virtually none of the laws’

impact on TFP growth can be directly associated with increased quantity of FDI or R&D,

although both series are strongly positively correlated with promulgation of the patent laws.

We infer that amount of technology transfer through a FDI and the focus of R&D activity,

decline of state ownership and increased marketization, growth of the human capital stock,


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and movement of the labor force from agriculture to manufacturing and service industries are

all processes that were encouraged and whose effect has been magnified by stronger IPR

protection. Moreover, adopting and enforcing the patent laws probably cannot be treated as an

independent event with causation running in only one direction to China’s economic

development.

John H. BARTON, February 2008, PATENTING AND ACCESS TO CLEAN ENERGY

TECHNOLOGIES IN DEVELOPING COUNTRIES

http://www.wipo.int/wipo_magazine/en/2008/01/article_0003.html

In the pharmaceutical sector, patents often have a substantial impact on price, as there may

be no substitute for a specific new drug. In such circumstances, the patent holder is in a strong

market position and may be able to charge a price well above production cost. In contrast, in

the three renewable energy sectors considered here, solar photo-voltaic (PV), biomass and

wind, the basic technological solutions have long been off-patent. What are patented are

usually only specific improvements or features. Thus, a number of competing patented

products exist – and as a result of the competition, prices are brought down as compared to

the royalties and the price increases that would be charged under a monopoly. In addition,

there is competition not only between firms within a specific sector, but also between the

sectors and between other sources of fuel or electricity.

Christopher GARRISON, August 2006, EXCEPTIONS TO PATENT RIGHTS IN

DEVELOPING COUNTRIES

http://www.unctad.org/en/docs/iteipc200612_en.pdf

This Paper examines the principles and practice of “exceptions to patent rights”, especially as

regards developing countries.

Many WTO Members (“Members”) are convinced of the utility of the patent system in

encouraging research and development activity for new inventions. Many other Members are

less confident of the benefits of the patent system and indeed are concerned about the

dangers that the patent system poses, in terms of, for example, the impact that it and other

intellectual property rights systems will have on their economic and social welfare. Where the

line is drawn between those areas that are the preserve of the patent holder to control, and

those areas which the patent holder may not control, is therefore a very important policy

question for Members. The subject of this Paper relates to one aspect of this policy question,

that is to say, “exceptions to patent rights”, which for present purposes, is taken to mean

certain “safe harbour” areas of activity where the rights of a patent holder do not extend. Other

limitations of the rights of patent holders and other matters such as the scope of patentability


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of inventions or the compulsory licensing of patents are outside the scope of this Paper,

although they are touched on as and when appropriate.

This Paper is divided into four sections: Exceptions existing at the time of the TRIPS

Agreement, Exceptions under the TRIPS Agreement, State practice on exceptions under the

TRIPS Agreement and a Policy Process for considering new exceptions.

COMMISSION ON INTELLECTUAL PROPERTY RIGHTS, September 2002, Final Report,

chapter 6: Patent Reform

http://www.iprcommission.org/papers/pdfs/final_report/Ch6final.pdf

The heterogeneous nature of developing countries, especially in their technical and scientific

capacities, means that they need to choose an IP system which they feel best meets their

development objectives, and economic and social circumstances. The more technologically

advanced developing countries may wish to adopt systems that provide extensive patent

protection as incentives for R&D. On the other hand, they would also wish to avoid those

aspects of the system which could provide disincentives to R&D, or which could lead to

resources being diverted to litigation and disputes about patents of doubtful validity. Such

systems would need to have adequate safeguards to ensure a competitive environment, and

to minimise costs for consumers. This is especially important in those areas of technology

such as pharmaceuticals and agriculture where the cost of providing strong patent protection

is likely to be greatest.

For the vast majority of developing countries, especially those with low incomes which rely

principally on imported goods and technology, the best system might be one which applies

strict standards of patentability and results in fewer patents meeting the criteria for

patentability. This may be preferable to a more extensive system of protection, of benefit

principally to foreign patent holders. A second tier of protection based on a form of patents

known as utility models which offer protection based on lower thresholds of patentability, may

be more appropriate than the full patent system to the economic circumstances of many

developing countries.

Because much of the scientific and technological expertise in developing countries is

concentrated in the public sector, there will need to be careful consideration of the implications

of following developed countries in encouraging more patenting by research institutions and

universities. Developing countries need to consider the issues raised in developed countries

about the incentives and disincentives this offers in the application of technologies invented in

these institutions, and about how it might affect research priorities.

The patent rules applying in developed countries are also important since much research

relevant to developing countries may be carried out in developed countries, or in collaborative


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efforts with developed country researchers. Of particular concern are patents on tools

essential for research, for example particular gene sequences in the field of biotechnology. An

increase in patenting of such research tools in developed countries might hinder research

relevant to developing countries. Developing countries also need to avoid, as far as possible,

the same problems arising in their patent systems.

Developing countries already face formidable obstacles in implementing patent systems.

There is strong pressure to harmonise the international patent system in order to overcome

the problems faced, mainly in developed countries, in coping with the pressure of rapidly

growing patent applications. Because the system is essentially national or regional, there is

much apparent duplication of procedures, such as search and examination, which

harmonisation could eliminate. The danger for developing countries is that harmonisation

would be around developed country standards of protection, which may not be suitable for

them. For developing countries the concern must be to ensure that they do not accept in these

discussions new international rules further limiting their freedom to design appropriate patent

policies, unless it can be shown it is in their interests to do so.

• Developing countries should, within the constraints of international and bilateral obligations,

provide a pro-competitive patent system that limits the scope of subject matter that can be

patented; applies strict standards of patentability; facilitates competition; includes extensive

safeguards against abuses of patent rights; and encourages local innovation.

• Developing countries which provide patent protection for biotechnological inventions should

ensure that patenting guidelines are such that the use of patented inventions by other

researchers is limited as little as possible. For instance, if patents over genes are allowed, the

guidelines should provide that the patent only covers uses set out in the patent, not other uses

of the same invention which others may uncover. This will facilitate further research in the area

of the patent.

Policy makers in developing countries should consider the establishment of utility model

protection for stimulating and rewarding such innovations, rather than diluting patentability

standards. This should help to provide incentives for the incremental type of innovations that

predominate in many developing countries.

• Whilst there is a role for IP in developing countries’ public research institutions to promote the

transfer and application of technologies, it is important that:

- Generating alternative sources of funding is not seen as the principal goal, which is rather to

promote technology transfer.

- Care be taken to ensure that research priorities, particularly as regards the technology

requirements of the poor, be it in agriculture or health, are not distorted by the search for a

larger licensing income.


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- Patenting and licensing should only be undertaken where it is judged necessary to

encourage private sector development and the application of technologies.

- Careful consideration be given to the need to take out "defensive" patents on important

inventions, particularly for use as a bargaining tool where complementary technologies are

owned by private sector entities and cross-licensing may be required to access those

technologies.

- Getting the balance right requires the development of expertise in IP in public sector

institutions which traditionally have had none, without losing sight of the objectives of public

policy for research.

• It is important in developing initiatives aimed at facilitating access to essential research tools,

that attention continues to be paid to opportunities to improve patent systems, in both

developed and developing countries, to obviate some of the problems these initiatives are

seeking to address.

• Developing countries need to identify a strategy for dealing with the risk that further

harmonisation of patent laws internationally will lead to standards that do not take account of

their interests. Such a strategy might seek a global standard reflecting the recommendations

of this report. It could seek continued flexibility in the standards. Or it could be done by

rejection of the process if it appears that the outcome will not be in the interests of developing

countries.

Sivaramjani THAMBISETTY, September 2002, HUMAN GENOME PATENTS AND

DEVELOPING COUNTRIES

http://www.iprcommission.org/papers/pdfs/study_papers/10_human_genome_patents.pdf

There is an international consensus among countries, reflected, among other things, in the

UNESCO Declaration on the Human Genome and Human Rights, 1997, that human genome

sequence information should be freely available. This would ensure that important research is

carried on without restriction in developed countries as well as in those developing countries

with the means to do so. However, developments in patent law have meant that human gene

sequences are being patented, raising the spectre of restricted access to such information as

well as high prices of any useful products developed. There is a need to clarify what

information on the human genome is freely available, and to what extent national patent

systems should be allowed to impinge on the international consensus.

It is recommended that the relevance of the UNESCO Declaration on the Human Genome and

Human Rights be re-evaluated. The Declaration also states that the benefits derived from

knowledge about the human genome should be shared by all countries. Merely making the

genome sequence itself available freely on the internet for example, satisfies this principle only


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in letter and not in spirit. The situation should be clarified with respect to industry expectations

of patent protection as well as developing country expectations about public health

improvement. It is recommended that gene sequences should remain pre-competitive

information so that greater quantum of research and analysis can be carried out in the post

genome sequence phase.

29. Patents, markets and companies

J. Patricio SAIZ, June 2010, WHY DID CORPORATIONS PATENT IN SPAIN? SOME

HISTORICAL INQUIRIES

http://www.uam.es/departamentos/economicas/analecon/especifica/mimeo2/wp_2010_02.pdf

In this paper we will explore how international corporations used the Spanish patent system in

the late nineteenth century and the first decades of the twentieth century in order to discover

what the actual effects of its apparent weakness were. The origins and evolution of corporate

patenting in Spain, the effects of compulsory working clauses, the management of

assignments, the various strategies followed by the firms, and the effects of patents on

technology transfer to the Spanish economy will be clarified. The conclusions yields

understanding on real patent management in the long-term by analyzing the strategies of

Brown Boveri and Babcock Wilcox corporations in Spain.

Eskil ULLBERG, June 2010, THE PROBLEM OF TRADING PATENTS IN ORGANIZED

MARKETS: A DYNAMIC EXPERIMENTAL MICROECONOMIC SYSTEM MODEL AND

INFORMAL PRICE THEORY

http://cesis.abe.kth.se/documents/CESISWP229.pdf

We are well familiar with the economic analysis of a patent system in terms of a temporary

monopoly on products, benefitting from marginal process inventions, formulated under

conditions of certain future demands. This article develops an experimental and dynamic

microeconomic model useful for studying the patent system as a trade system, where

patented technology is exchanged in organized competitive markets, under uncertain future

demands. An economic system design is developed to study transparent prices of patents,

dynamic gains from using a patent in multiple industries and the coordination of invention,

intermediary and innovation activities using a linear contract on patents (fixed fee plus royalty

on revenues). A trader is introduced together with inventor and innovator agents in order to

multiply the value (use) of the technology. Three mechanism designs and two levels of

presumption of validity of the underlying patent right are proposed. The analysis differs from

previous work on patents, trade and economics in that the focus is on the competitive pricing


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of the rights themselves, using demand side bidding. An informal theory is outlined to price the

dual values of a patent (investing and blocking). Based on this proposition tentative hypothesis

are outlined for two initial experiments using the outlined economic system design.

William LAZONICK, Edward MARCH, April 2010, THE RISE AND DEMISE OF LUCENT

TECHNOLOGIES (unpublished)


We analyze the rise and demise of Lucent Technologies from the time that it was spun off from

AT&T in April 1996 to its merger with Alcatel in December 2006. The analysis, contained in the

three sections that form the body of this paper, considers three questions concerning Lucent’s

performance over the decade of its existence. 1. How was Lucent, with over $20 billion in

sales in 1995 as a division of AT&T, able to almost double its size by achieving a compound

growth rate of over 17 percent per year from 1995 to 1999? 2. What was the relationship

between Lucent’s growth strategy during the Internet boom and the company’s financial

difficulties in the Internet crash of 2001-2003 when the Lucent was on the brink of bankruptcy?

3. After extensive restructuring during the telecommunications industry downturn of 2001-

2003, why was Lucent unable to re-emerge as an innovative competitor in the communications

equipment industry when the industry recovered?

Elisabeth MÜLLER, Franz SCHWIEBACHER, January 2010, HOW COMPANIES USE

DIFFERENT FORMS OF IPR PROTECTION – ARE PATENTS AND TRADEMARKS

COMPLEMENTS OR SUBSTITUTES?


This paper investigates the question of whether patents and trademarks are complements or

substitutes. From a theoretical point of view both cases are possible. For some applications

the effectiveness of patent protection is weak, because competitors can invent around a

specific patent in a short period of time. If a company manages to build up ‘brand equity’ with

the help of trademarks, sales with relatively high margins may be sustained even if the

technological lead is lost. In addition, the concept of ‘brand equity’ refers (in part at least) also

to aspects of asymmetrical information. Thus, patents and trademarks may be mutually

reinforcing as trademarks reduce informational gaps between potential users and producers of

new inventions. This mechanism argues for a complementary use of both rights. In contrast,

some products will be especially amenable to patent protection whereas others will be more

suitable for trademark protection. A substitutive relationship between the two property rights is

therefore also possible. Besides the coverage of intellectual property rights in itself, uncertainty

regarding the quality and reliability of new inventions may also lead to a substitutive


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relationship between patents and trademarks. The uncertainty inherent in new combinations of

technological knowledge may be diametral to the intangible, reputational assets embodied in a

trademark. Thus, complementary relationship between patents and trademarks should

diminished with the degree of novelty of the innovation.

The analysis is based on company information from the years 2005 to 2007 of the Mannheim

Innovation Panel (MIP). Information on around 1500 companies is used.

We test for the existence of complementarities using the methodology of Cassiman and

Veugelers (2006). From the adoption approach we learn that companies tend to use patents

and trademarks together, which is an indication for the two intellectual property rights being

complements. When looking at the success with innovations measured as the share of sales

with new products (productivity approach), our results suggest a substitutive relationship

between patents and trademarks. As next steps we investigate whether different IPR policies

are present in manufacturing versus service sectors...In addition, we analyze whether these

IPR policies are affected by degrees of novelty of patented inventions.

Gustav MARTINSSON and Hans LÖÖF, September 2009, INTERNAL FINANCE AND

PATENTS - EVIDENCE FROM FIRM-LEVEL DATA

http://ideas.repec.org/p/hhs/cesisp/0194.html

We find that internal finance resources at the firm-level, measured by cash flow, play a non-

trivial role for the number of patent applications, even after controlling for the standard

variables of a patent study. The results are based on estimating panel count-data models on a

sample of 2,700 Swedish manufacturing firms, with observations from the period 1997-2005.

The cash-flow effect is larger during the aftermath of the bursting IT-bubble and for firms that

are more likely to be financially constrained. Our results suggest that some firms reduce or

stop applying for patents during periods of declining economic activity.

Diego LEGROS, February 2009, THE USE OF PROPERTY RIGHTS BY FRENCH FIRMS


In attempting to appropriate their innovations, firms can chose from a range of mechanisms,

including patents, trade secrets and lead-times. Yet, little is known about how firms choose

different appropriability mechanisms. The aim of this paper is to determine how the use of

intellectual property rights (IPRs) by French firms is related to their characteristics, activities,

competitive strategies and industry sector in which they operate. Among their characteristics,

we test the role of the human resource strategy. Our empirical model is based on French

Community Innovation Survey (CIS) in 2004. Our results show that the use of IPRs is


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correlated with basic economic characteristics of firms, their activities and industry

environment.

Gaétan DE RASSENFOSSE and Bruno VAN POTTELSBERGHE DE LA POTTERIE, 2008,

ON THE PRICE ELASTICITY OF DEMAND FOR PATENTS

http://ideas.repec.org/p/eca/wpaper/2008_031.html

This paper investigates whether patent fee policies are a potential factor underlying the boom

in patent applications observed in major patent offices. We provide the first panel-based

evidence suggesting that fees affect the demand for patents in three major patent offices

(EPO, USPTO and JPO), with a price elasticity of about -0.4 (similar to that of the residential

demand for oil or water). The laxity of fee policies adopted by patent offices over the past 25

years therefore contributed, to a significant extent, to the rising propensity to patent observed

since the mid-nineties. This is especially true at the European Patent Office, which has

dramatically decreased its fees since the mid-1990s.

Katrin HUSSINGER, March 2005, IS SILENCE GOLDEN? PATENTS VERSUS SECRECY AT

THE FIRM LEVEL


In the 1990s, patenting schemes changed in many respects: upcoming new technologies

accelerated the shift from price competition towards competition based on technical

inventions, a worldwide surge in patenting took place, and the 'patent thicket' arose as a

consequence of strategic patenting. This study analyzes the importance of patenting versus

secrecy as an effective alternative to protect intellectual property in the inventions' market

phase. The sales figure with new products is introduced as a new measure for the importance

of tools to protect IP among product innovating firms. Focusing on German manufacturing in

2000, it turns out that patents are important to protect intellectual property in the market,

whereas secrecy seems to be rather important for inventions that are not commercialized yet.

30. Patent families

Mendelson, Seth E., Miller, Barbara Hall, Poolman, Robert A. 2011 BLURRING THE LINE

BETWEEN BIOINFORMATICS AND PATENT ANALYSIS

HTTP://IDEAS.REPEC.ORG/A/EEE/WORPAT/V33Y2011I3P257-259.HTML


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Biological patent analysts are often faced with querying multiple databases of sequence and

text. After retrieving the query results, the results must be analyzed by reviewing patents and

applications in a form of manual data reduction. Once families are identified for final analysis,

the analyst must expand back out, looking at the members of those patent families. Again,

sequence and text is reviewed manually, not algorithmically. One way for patent analysts to

reduce the number of repetitive tasks performed is through the creation of macros. Such

macros can be used for time-consuming tasks like global formatting, searching and replacing

within a document, formatting extracted sequences into FASTA, or even converting three-letter

amino acid code into single-letter code. Another way for a patent analyst to reduce repetitive

tasks in biosequence patent analysis is through an alliance between biological patent analysts

and bioinformaticians. Such an alliance could result in the development of tools that focus on

these types of repetitive tasks. A bioinformatician is skilled in looking for solutions to various

repetitive tasks. Such a solution could even be packaged and deployed to those colleagues

who would benefit from access to such a time-saving program. Finding a way to automate

repetitive tasks will free the patent analyst to spend more time on intellectual analysis of the

results.

Catalina MARTÍNEZ, February 2010, INSIGHT INTO DIFFERENT TYPES OF PATENT

FAMILIES

http://dx.doi.org/10.1787/5kml97dr6ptl-en

What are patent families? What is the impact of adopting one definition or another? Are some

definitions of patent families better suited than others for certain uses in statistical and

economic analysis?

The aim of this paper is to provide some answers to these questions, compare the

methodologies and outcomes of the most commonly used patent family definitions and provide

guidance on how to build families based on raw data from the EPO Worldwide Patent

Statistics database (PATSTAT). One of our findings, based on a characterisation of family

structures, is that extended patent families and other family definitions, such as equivalents

and single-priority families, provide identical outcomes for about 75% of the families with

earliest priority dates in the 1990s because they have quite simple structures. Differences

across definitions only become apparent for the families with more complex structures, which

represent 25% of the families of that period.

Peter HINGLEY and Walter G. PARK, July 2009, PATENT FAMILY DATA AND STATISTICS

AT THE EUROPEAN PATENT OFFICE

http://w.american.edu/cas/economics/repec/amu/workingpapers/2009-08.pdf


138

At the European Patent Office (EPO) a comprehensive data file called PRI is maintained of

patent families. The file records are based on published patent documents, indexed by the

priority number of the first patent filing, with information on subsequent patenting activities for

that invention in the four major economic blocs: EPC contracting states, Japan, USA and

Others. It is possible to filter the data in order to highlight the most important inventions, for

example by selecting Trilateral patent families that lead to patenting activity in: EPC

contracting states (including EPO), Japan and USA.

The relationship between patent families and subsequent filings is not one-to-one. In order to

compare calculated figures from the EPO data set with an alternative system of consolidated

families, it is suggested that bounds may be calculable for numbers of consolidated families by

taking account of the overall numbers of network links between priority forming first filings and

subsequent filings. The key to this methodology is the identification of all the links between first

filings and subsequent filings in a family.

There is a timeliness problem caused by a considerable delay between the date of first filing

and the appearance of a publication that can index a patent family. A method is described by

which more up-to-date counts of families (numbers of priorities) can be made by augmenting

the database with information that is available in the distinct filings databases at the patent

offices.

The families data set can be used to investigate the patenting behaviour by individual

companies, industries, countries or economic blocs, or to study changing patterns of

technology in world-wide industrial research. Some representative data are presented over a

series of years that show increasing trends for the numbers of world-wide first filings, for

numbers of filings flowing from one country to another, for numbers of patent families making

use of the PCT system, and for the numbers of families within the EPC contracting states area

that make use of the EPO.

Good forecasts for numbers of patent filings at the EPO are needed for the purpose of internal

resource requirements planning. An initial attempt is described to set up an econometric model

for the development of subsequent filings at the EPO, based on patent families information

and on concomitant variables including source country R&D stock per worker and source

country GDP per capita. It may eventually be possible to generalise a successful model of this

type in order to predict filings flows to and from all the major patent offices.

John P. WALSH, Sadao NAGAOKA, July 2009, WHO INVENTS?: EVIDENCE FROM THE

JAPAN-US

http://www.rieti.go.jp/jp/publications/dp/09e034.pdf


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Human resources are increasingly seen as a key to innovation competitiveness, and there is a

need for detailed, systematic data on the demographics of inventors, their motivations, and

their careers. To gain systematic data on who invents, we collected detailed information on a

sample of inventors in the US and Japan (the RIETI-Georgia Tech inventor survey). The data

come from a unique set of matched surveys of US and Japanese inventors of triadic patents,

i.e., patents from patent families with granted patents in the US and applications filed in Japan

and in the EPO, with data from over 1900 responses from the US and over 3600 responses

from Japan. Based on these survey data, we compare the profiles, motivations, mobility and

performance of inventors in the US and Japan. Overall, we find some important similarities

between inventors in the US and Japan. The distribution across functional affiliations within the

firm, by gender, by educational fields and their motivations, are all quite similar. In particular, in

both countries we find inventors emphasizing task motivations over pecuniary motivations.

Firm-centered motivation (e.g., generating value for my firm) is also an important reason for

inventing and this reason is relatively more important in the US than Japan. Their distribution

across types of organizations is quite similar. The percent of university inventors is nearly the

same in the two countries, and the distribution of these inventors across technology classes is

also quite similar. However, the percent from very small firms is significantly higher in the US.

There are a few important differences. American inventors are much more likely to have a

PhD. American inventors are older (even controlling for differences in the share of the

inventors with PhDs). The modal Japanese inventor has his first invention in his 20s, while for

the US, the mode is the early 30s, and we also find many more American inventors over age

55 at the time of their triadic patent invention. In both countries, older inventors tend to

produce higher value patents. American inventors are also much more mobile (although

Japanese inventors with PhDs also have high rates of mobility, mainly in the form of

secondments). In the US, mobility tends to decline with age, while in Japan, mobility is higher

for older inventors (likely due to the differences in retirement ages in the two countries). In both

countries, mobility is associated with greater access to outside information. Finally, we find

that foreignborn inventors are very important in the US (we did not collect data on country of

origin for Japan). Overall, these results suggest that inventor characteristics may be important

for firm performance, and that institutional differences may affect the profile of inventors in

each country, although the inventors of the two countries are very similar in many respects.

Future work will examine how these cross-national differences in inventor profiles affect

innovation in each country.


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31. Patents and other topics

Angus C. CHU and Shin-Kun PENG, April 2010, INTERNATIONAL INTELLECTUAL

PROPERTY RIGHTS: EFFECTS ON GROWTH, WELFARE AND INCOME INEQUALITY.

(Unpublished)


What are the effects of strengthening developing countries' protection for intellectual property

rights on economic growth, social welfare and income inequality in the global economy? To

analyze this question, we develop a two-country R&D-based growth model with wealth

heterogeneity. We find that the North experiences higher growth and welfare at the expense of

higher income inequality while the South experiences higher growth at the expense of lower

welfare and higher income inequality. As for global welfare, there exists a critical degree of

cross-country spillovers below (above) which global welfare decreases (increases). In light of

these findings, we discuss policy implications on China's accession to the World Trade

Organization in 2001.

Elisabetta OTTOZ, Franco CUGNO, February 2010, CHOOSING THE SCOPE OF TRADE

SECRET LAW WHEN SECRETS COMPLEMENT PATENTS


We present a model where an incumbent firm has a proprietary product whose technology

consists of at least two components, one of which is patented while the other is kept secret. At

the patent expiration date, an entrant firm will enter the market on the same technological

footing as the incumbent if it is successful in duplicating, at certain costs, the secret

component of the incumbent’s technology. Otherwise, it will enter the market with a production

cost disadvantage. We show that under some conditions a broad scope of trade secret law is

socially beneficial despite the innovator is over-rewarded.

Nicolas VAN ZEEBROECK July 2009, FROM PATENT RENEWALS TO APPLICATIONS

SURVIVAL: DO PORTFOLIO MANAGEMENT STRATEGIES PLAY A ROLE IN PATENT

LENGTH?


The decision of firms to renew their patents is largely assumed to be the result of a careful

valuation exercise to balance their expected revenues with renewal fees. This article extends

this line of reasoning to all patent applications filed to the EPO over a 20 years period and

analyzes with a survival time model the determinants of their maintenance throughout their life,

from filing to withdrawal, refusal or lapse. The results first show that the classical patent value

proxies (families, claims, IPC classes and forward citations) constitute strong predictors of the


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entire length of patent rights and even more so before their grant than after, suggesting that

the length of an application, even non granted, is indicative of its expected private value to the

firm. They suggest that the IP management strategies of the firms aiming at building large

portfolios or families to protect their inventions make them less selective in their renewal

decisions. Finally, the results suggest that even the length of non granted applications (i.e. the

duration of their examination) is significantly influenced by factors relating to their scope and

importance and to the patenting strategy of the firms and is therefore partly in control of the

applicant, particularly through the PCT option and the filing of divisionals.

Valérie MERINDOL, Emmanuelle FORTUNE, July 2009, ANALYSE DES INFORMATIONS

DISPONIBLES DANS LA BASE PATSTAT, Rapport d'expertise, Observatoire des Sciences et

des Techniques (OST)

http://www.obs-ost.fr/fileadmin/medias/tx_ostdocuments/RapportOST-expertise-brevet_01.pdf

James E. BESSEN, Michael J. MEURER, Working Paper 09-18, April 2009, OF PATENTS

AND PROPERTY

http://www.bu.edu/law/faculty/scholarship/workingpapers/BessenJMeurerM.html

Do patents behave substantially like property rights in tangible assets, in that they encourage

development and innovation? This article notes that historical evidence, cross-country

evidence, economic experiments, and estimates of net benefits all indicate that general

property rights institutions have a substantial direct effect on economic growth. Conversely,

with a few important exceptions like chemicals and pharmaceuticals, empirical evidence

indicates that intellectual property rights have at best only a weak and indirect effect on

economic growth. Further, it appears that for public firms in most industries today, patents may

actually discourage investment in innovation for fear of winding up on the losing side of a

patent fight, and routine injunctive relief from patent protection may contribute to this problem.

Michael J. MEURER, Katherine J. STRANDBERG, Working Paper 09-17 April 2009, PATENT

CARROTS AND STICKS: A MODEL OF NONOBVIOUSNESS

http://www.bu.edu/law/faculty/scholarship/workingpapers/MeurerStrandbergCarrots.html

The authors develop an informal model of the impact of the nonobviousness standard on the

choice of research projects. Previous models assume that the basic question confronting a

researcher is, "Shall I produce this particular invention?" More realistically, the authors think a

researcher asks, "Which research path shall I pursue?" The model shows that a patent serves

as a carrot to induce the choice of more difficult projects than would be pursued under the no-

patent alternative. The nonobviousness standard serves as a stick to prod researchers to


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choose even more difficult projects. The results of the model help us understand why a fact-

intensive issue like obviousness is a question of law. The model also helps us understand the

optimal relationship between the nonobviousness standard and patentable subject matter

exclusions. Commentators often suggest subject-matter exclusions are unnecessary if the

nonobviousness standard is used appropriately. The authors' model suggests this intuition is

wrong for inventions characterized by large social spillovers and high social costs of patenting;

a simple subject matter exclusion would be more efficient.

Malwina MEJER, Bruno VAN POTTELSBERGHE DE LA POTTERIE, January 2009,

ECONOMIC INCONGRUITIES IN THE EUROPEAN PATENT SYSTEM

http://www.ecares.org/

This paper argues that the consequences of the ‘fragmentation’ of the European patent

system are more dramatic than the mere prohibitive costs of maintaining a patent in force in

many jurisdictions. First, detailed analysis of judicial systems in several European countries

and four case studies provide evidence suggesting that heterogeneous national litigation

costs, practices and outcome induce a high level of uncertainty. Second, a high degree of

managerial complexity results from systemic incongruities due to easier ‘parallel imports’,

possible ‘time paradoxes’ and the de facto paradox of having EU-level competition policy and

granting authority ultimately facing national jurisdictional primacy on patent issues. These high

degrees of uncertainty and complexity contribute to reduce the effectiveness of the European

patent system and provide additional arguments in favour of the Community patent and a

centralized litigation in Europe.

Francesco LISSONI, Fabio MONTOBBIO, November 2008, INVENTORSHIP AND

AUTHORSHIP IN PATENT-PUBLICATION PAIRS: AN ENQUIRY INTO THE ECONOMICS

OF SCIENTIFIC CREDIT

http://www.cespri.unibocconi.it/

Authorship and inventorship are attribution rights that contribute to the reputation of individual

scientists, but have to be distributed across several individuals, due to the importance of

teamwork in both science and technology. For academic teams that both publish and patent

their research results, we can compare the social and legal norms that regulate the joint

distribution of these two types of attribution rights. We use text-mining techniques to identify

681 “patent-publication pairs” (related sets of patents and publications), for a sample of Italian

academic scientists. On average, the number of coauthors is larger than the number of co-

inventors, especially in medical-related fields. First and last authors have a lower probability of

being excluded from inventorship, as suggested by patent laws. However, the probability of


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exclusion also declines with seniority, as expected from social norms. Longlasting doubts on

the reliability of authorship as a tool for allocating scientific credit are reinforced, and can be

extended to inventorship.

EUROPEAN PATENT OFFICE, JAPAN PATENT OFFICE, UNITED STATES PATENT AND

TRADEMARK OFFICE, October 2008, TRILATERAL STATISTICAL REPORT 2007 EDITION

http://www.trilateral.net

Collaboration between the European Patent Office (EPO), the Japan Patent Office (JPO), and

the United States Patent and Trademark Office (USPTO) has proved to be successful in the

area of patent statistics. The three Offices, that are commonly referred to as the Trilateral

Offices in the patent community, have once again jointly produced the Trilateral Statistical

Report (TSR). This is an annual compilation of patent statistics. In addition to promoting a

better understanding of the importance of patent rights in the world, the report explains each

Office’s operations and informs generally about patent grant procedures. In order to do this,

the report discusses background activities at each Office, reviews worldwide patenting

activities and then compares the patent related work at the Trilateral Offices. The TSR

supplements annual reports for each of the three Offices and also uses statistics that are

collected by the International Bureau of the World Intellectual Property Organization (WIPO).

Fiona MURRAY, Scott STERN, September 2008, LEARNING TO LIVE WITH PATENTS:

ACQUIESCENCE & ADAPTATION TO THE LAW BY THE LIFE SCIENCES COMMUNITY


Scholarly studies of how the law affects knowledge work tend to fall between two extreme

views. Economists, as well as legal and policy scholars, debate how changes in legal

institutions, particularly in expanding property rights, shape the daily lives of knowledge

workers. In contrast, ethnographies of knowledge work usually fail to highlight lawyers as key

actors. The current study reconciles these views, arguing that in response to changing legal

institutions, knowledge communities engage in both costly acquiescence and adaptation to the

law. This perspective suggests that while the law may cause significant disruption to

knowledge communities, through their adaptation the law becomes commonplace and

unremarkable. Our study measures these processes by tracing how changes in the

enforcement of intellectual property rights shape patterns of knowledge exchange and

accumulation within knowledge communities. Specifically, we conduct a large-scale

quantitative analysis of publications and patents drawn from a period characterized by

dynamic changes in property rights enforcement, assessing how enforcing intellectual property

rights over scientific knowledge influences the life sciences community. Our analysis reveals


144

that initially, IP engenders costly acquiescence on the part of academic scientists, reducing

their level of knowledge exchange. Over time, however, adaptation exerts an even larger

influence, facilitating exchange even in the presence of IP rights. Consequently, the long-term

impact of patent law reflects a balancing act between the processes of acquiescence and

adaptation. More broadly, our work suggests that legal institutions play an important, though

subtle, role in the structure and practices of knowledge communities and knowledge work.

Angus C. CHU, August 2008, EFFECTS OF PATENT POLICY ON INCOME AND

CONSUMPTION INEQUALITY IN AN R&D-GROWTH MODEL


What are the effects of strengthening patent protection on income and consumption

inequality? To analyze this question, this paper incorporates heterogeneity in the initial wealth

of households into a canonical quality-ladder growth model with endogenous labor supply. In

this model, I firstly show that the aggregate economy always jumps immediately to a unique

and stable balanced-growth path. Given the balanced-growth behavior of the aggregate

economy and an exogenous distribution of initial wealth, I then show that the endogenous

distribution of assets in subsequent periods is stationary and equal to its initial distribution. The

model predicts that strengthening patent protection increases (a) economic growth by

stimulating R&D investment and (b) income inequality by raising the return on assets.

However, whether it also increases consumption inequality depends on the elasticity of

intertemporal substitution. If and only if this elasticity is less (greater) than unity, strengthening

patent protection increases (decreases) consumption inequality. For standard parameter

values, strengthening patent protection leads to a larger increase in income inequality than

consumption inequality.

Nicolas VAN ZEEBROECK, June 2008, DEVELOPPEMENT ET IMPACT DES STRATEGIES

DE DEPOT DE BREVETS

http://www.cairn.info/resume.php?ID_ARTICLE=RPVE_473_0087

This article proposes an analysis of the evolution and determinants of patent filing strategies

and their impact on the patent system. Its motivation resides in the evolution of practices

(patent drafting and filing) over the past 20 years, characterized by a surge in the number and

size of patent applications. These developments could compromise the ability of the patent

system to fulfill its economic purpose of incentive to innovate, as the inflation in number and

size of applications induce considerable backlogs and delays. Based on a unique database

and different econometric models, this paper first analyses the drivers of this evolution, notably

the international diffusion of practices, the growing complexity of inventions, emerging


145

technological sectors, and the building of large patent portfolios. The association of these

developing strategies with patent value is then investigated based on traditional indicators and

a new composite index of patent value. Finally, a more thorough analysis of the patent length

confirms that these strategies are strongly associated with patent value, but mostly reveal that

their main effect is to slow down the examination process, resulting into legal uncertainty in the

patent system and raising several policy implications.

Nicolas VAN ZEEBROECK, June 2008, LONG LIVE PATENTS: THE INCREASING LIFE

EXPECTANCY OF PATENT APPLICATIONS AND ITS DETERMINANTS

http://ideas.repec.org/a/pia/review/v2y2011i3n5.html

Relying on a comprehensive dataset including detailed information on all patent applications

filed to the EPO from 1980 to 2000 and on the renewal of those of them that were granted, this

paper presents the first survival time analysis of the determinants of patent length. The results

are threefold: first, they clearly establish that the life expectancy of patent rights has

significantly increased over the past decades despite a small decline in the average grant rate.

Second, they show that some filing strategies strongly influence the length of patents, possibly

due to induced delays in the examination process. And third, they confirm that more valuable

patents (more cited or covering a larger geographical scope) tend to live longer.

INPI - Observatoire de la Propriété Intellectuelle, 2008, ENQUETE SUR LA REMUNERATION

DES INVENTEURS SALARIES

http://www.inpi.fr/fr/l-inpi/observatoire-de-la-propriete-intellectuelle/etudes-recentes-de-l-

observatoire.html

Ce dossier présente un état des lieux actualisé et public des pratiques des entreprises

françaises en matière de rémunération de leurs inventeurs salariés. Il repose essentiellement

sur une enquête par questionnaire effectuée en 2008, par l’Observatoire, auprès de plus de

280 entreprises. 88 réponses ont été reçues (profils variés en termes de tailles et de domaines

d’activité), dont les résultats sont présentés ici.

Plus que la représentativité statistique, l’enquête effectuée par l’Observatoire auprès des

entreprises vise l’exemplarité : les résultats pourront servir de référentiel aux entreprises qui

souhaitent adopter ou mettre à jour un tel système.

Le droit français distingue 3 types d’inventions de salariés :

− L’invention de mission s’entend soit comme invention réalisée dans le cadre du contrat de

travail impliquant une mission inventive, soit comme invention réalisée par un salarié qui s’est

vu confier de manière expresse une mission d’études ou de recherche. Elle appartient à

l’employeur.


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− Une invention hors mission est attribuable à l’employeur si elle a été réalisée au cours de

l’exercice des fonctions du salarié ou dans le domaine ou avec les moyens de l’entreprise. Elle

appartient à l’employeur.

− Par défaut, une invention qui n’entre pas dans les catégories précédentes est une invention

hors mission non attribuable : le salarié a conçu une invention hors de ses missions et du

domaine d’activité de l’entreprise. L’invention appartient au salarié. Tout salarié qui réalise une

invention a l’obligation d’en faire déclaration à son employeur.

Cette obligation concerne tous les salariés et toutes les inventions, qu’il s’agisse d’une

invention de mission ou hors mission. Le salarié doit déclarer son invention à son employeur

en lui proposant un classement, c’est-à-dire la catégorie dans laquelle il classe son invention.

Elisabetta OTTOZ, Franco CUGNO, October 2007, PATENT-SECRET MIX IN COMPLEX

PRODUCT FIRMS

http://www.de.unito.it/web/member/segreteria/WP/2007/7_WP_Ottoz_Cugno.pdf

Different protection mechanisms may be employed at the same time for a given innovation

when the innovation is comprised of separately protectable components. If patents and trade

secrets can be mixed in protecting single innovations, a strengthening in patent breadth may

induce a lower level of patenting, as innovators are more prone to rely on secrecy.

Douglas LICHTMAN, Mark A. LEMLEY, August 2007, RETHINKING PATENT LAW'S

PRESUMPTION OF VALIDITY


The United States Patent and Trademark Office is tasked with the job of reading patent

applications and determining which ones qualify for patent protection. It is a Herculean task,

and the Patent Office pursues it subject to enormous informational and budgetary constraints.

Nonetheless, under current law, courts are bound to defer to the Patent Office's decisions

regarding patent validity. In this Article, we argue for reform. Deference to previous decision-

makers is appropriate in instances where those previous decisions have a high likelihood of

accuracy, and the patent system should endeavor to create processes that fit this mold. But

granting significant deference to the initial process of patent review is indefensible and

counter-productive. Patents should be vulnerable to challenge until and unless they are

significantly evaluated in an information-rich environment. At that point, they will have earned

and therefore should be accorded a presumption of validity. Such an approach would better

serve the patent's systems long-run incentive goals, and it would give patent applicants better

incentives to file for genuine inventions but leave their more obvious and incremental

accomplishments outside the patent system's purview. Here, we therefore suggest the


147

creation of a two-tier system of patent validity, with patents that are subject to intensive

scrutiny accorded a strong presumption of validity, while untested patents are left to be

evaluated more fully in court.

Dietmar HARHOFF, Bronwyn H. HALL, Georg VON GRAEVENITZ, Karin HOISL, Stefan

WAGNER, July 2007, THE STRATEGIC USE OF PATENTS AND ITS IMPLICATIONS FOR

ENTERPRISE AND COMPETITION POLICIES

Alfonso GAMBARDELLA, Paola GIURI, CASE STUDY: EVIDENCE ON STRATEGIC

PATENTING BY USING THE PATVAL -EU SURVEY

http://www.inno-tec.bwl.uni-

muenchen.de/forschung/forschungsprojekte/laufendeprojekte/index.html

This report was commissioned as a study into the strategic use of patents. In the course of its

case investigations and legislative reviews the European Commission became aware of

changes in the use of intellectual property, in particular the use of patents. It was noted that

firms’ uses of intellectual property are becoming increasingly strategic. This raised concerns

about the implications of firms’ patenting behaviour for enterprise and competition policy. The

following report contains a comprehensive review of patenting behaviour, the extent to which

patenting is becoming more strategic and the implications this has for competition and

enterprise policies. A surge in patent applications, “a patenting explosion”, has been observed

at the European Patent Office (E.P.O.) as well as at the patent office for the United States of

America (U.S.P.T.O) and other patent offices world wide. Firms’ patenting behaviour has

changed in several industrial sectors. Most of these sectors draw on complex technologies.

This means that final products embody a combination of a large number of patented

technological advances. Most often a single firm does not possess all patents relevant to a

final product. Strategic behaviour by rival firms supplying the same final product markets

ensues: patent portfolios may need to be licensed, patents may be used to block rivals use of

technology or to extract concessions. Strategic uses of patent portfolios are a new

phenomenon flowing from the increased complexity of modern technology. Previously small

patent portfolios could be used to protect an entire technology. Mobile telephony provides an

example for the recent trend: the technical standards on which this technology is based

contain hundreds of patents. These patents are owned by many different firms. Ongoing

competition cases in this industry demonstrate the potential for strategic behaviour.

Mario CIMOLI and Annalisa PRIMI, May 2007, TECHNOLOGY AND INTELLECTUAL

PROPERTY: A TAXONOMY OF CONTEMPORARY MARKETS FOR KNOWLEDGE AND

THEIR IMPLICATIONS FOR DEVELOPMENT


148


This paper aims to contribute to frame the IP for development debate into a more extensive

discussion on appropriability, within the perspective of policies shaping scientific, technological

and production capabilities in the light of development theory. Through the lenses of the

paradigm based theory of innovation, the authors first recognize that technological

asymmetries and gaps between firms and countries appear more as sticky features than as

transitory stages of (automatic) adjustment processes, thus reassessing the appropriability ad

disclosure function of patents. Then, the paper presents a taxonomy of contemporary markets

for knowledge, flagging the existence of what we call derivative markets for knowledge.

Patents become to a certain extent liquid because they loose the weight and the density of the

technological component and they can easily circulate in the market without having

necessarily to be entangled in any final artifact. Just as in derivative financial markets, the

value of patents is a function of expectations regarding their uncertain potential future value.

The paper concludes sketching the implications for development focusing on two major issues:

i) how reassessing the role of IP through an evolutionary perspective affects behavioral

microfoundations of innovative conducts and ii) how asymmetries in technological and

production capacities between countries mould patenting behavior and participation and

exclusion in the contemporary markets for knowledge.

Cédric SCHNEIDER, April 2007, THE DETERMINANTS OF PATENT APPLICATIONS

OUTCOMES - DOES EXPERIENCE MATTER?


The aim of this paper is to study the determinants of the outcomes of patent applications

(withdrawal, refusal or grant). The application process at the European Patent Office is

modelled in three stages, using a Trivariate Probit model with double selectivity correction in

order to test whether the applicants’ patenting history has an effect on the outcome of the

current application. I investigate the behavior of the applicant after the patent office has

established the "state of the art", a precondition to an invention being patentable. The main

results are (i) firms with large patents portfolios act following a "trial and error" strategy, by

applying for large numbers of patents and thereafter waiting for the patent office’s final

decision when the expected probability of grant is high, (ii) the technological importance of a

patent is a crucial determinant of a successful application grant, (iii) a withdrawal is to be

regarded as an expected refusal, since applicants tend to withdraw their applications when

there is evidence that the inventions cannot be considered to be novel or to involve an

inventive step.


149

Dirk CZARNITZKI, Wolfgang GLÄNZEL, Katrin HUSSINGER, April 2007, HETEROGENEITY

OF PATENTING ACTIVITY AND ITS IMPLICATIONS FOR SCIENTIFIC RESEARCH,

Discussion Paper No. 07-028

http://opus.zbw-kiel.de/volltexte/2007/5687/pdf/dp07028.pdf

The increasing commercialization of university discoveries has initiated a controversy on the

impacts for future scientific research. It has been argued that an increasing orientation towards

commercialization may have a negative impact on more fundamental research efforts in

science. Several scholars have therefore analyzed the relationship between publication and

patenting activity of university researchers, and most articles report positive correlations.

However, most studies do not account for heterogeneity of patenting activities ranging from

university patents to corporate patents. While the former may have closer links to basic

research, this is not what we expect from the latter. We argue that such efforts will indeed

distract scientists from other activities, as collaborations with companies are usually assumed

to have an applied character and do not necessarily coincide with basic research tasks. This

paper investigates the incidence of patenting and publishing distinguishing between different

types of patents for a large sample of professors active in Germany. Our results show that,

while university patents as well as patents assigned to not-for-profit institutions complement

publication quantity and quality, corporate patents yield negative effects.

Francesco LISSONI, Patrick LLERENA, Maureen MCKELVEY, Bulat SANDITOV, 2007,

ACADEMIC PATENTING IN EUROPE: NEW EVIDENCE FROM THE KEINS DATABASE

ftp://ftp.unibocconi.it/pub/RePEc/cri/papers/WP202LissoniLlerenaMcKelveySanditov.pdf

The paper provides summary statistics from the KEINS database on academic patenting in

France, Italy, and Sweden. It shows that academic scientists in those countries have signed

many more patents than previously estimated. This re-evaluation of academic patenting

comes by considering all patents signed by academic scientists active in 2004, both those

assigned to universities and the many more held by business companies, governmental

organizations, and public laboratories. Specific institutional features of the university and

research systems in the three countries contribute to explain these ownership patterns, which

are remarkably different from those observed in the US. In the light of these new data,

European universities’ contribution to domestic patenting appears not to be much less intense

than that of their US counterparts.

Nicolas VAN ZEEBROECK, October 2007, preliminary version, PATENTS ONLY LIVE

TWICE: A PATENT SURVIVAL ANALYSIS IN EUROPE



150

The length of patent rights is an issue of considerable importance in the design of patent

systems, and its optimality has been intensively discussed in the literature. This dimension –

taking the form of the number of years during which a given patent has been maintained – has

been considered in the empirical literature as a direct indication of the private value of patents.

But the lack of comprehensive data on both the renewal of patents and their characteristics

has prevented so far any systematic analysis of the determinants of this duration. Relying on a

comprehensive dataset including detailed information on all patent applications filed to the

European Patent Office from 1980 to 2000 and on the renewal of those of them that were

granted, this paper presents a survival time analysis of the determinants of patent length in

Europe. The results are threefold: first, they clearly establish that patent rights have

significantly increased in length over the past decades despite a small decline in the average

grant rate, and due to the dilatation of the examination process and higher maintenance rates.

Second, they show that some filing strategies induce considerable delays in the examination

process, possibly to the benefits of the patentee, but most certainly to the expense of legal

uncertainty on the markets and undue exploitation of the provisional protection granted to

pending applications by the European Patent Convention. And third, they confirm that more

valuable patents (more cited or covering a larger geographical scope) take more time to be

processed and live longer, whereas more complex applications are associated with longer

decision lags but also with lower grant and renewal rates. These results have many policy

implications for technology markets, patent systems and all their stakeholders.

Bruno VAN POTTELSBERGHE DE LA POTTERIE and Nicolas VAN ZEEBROECK, 2007, A

BRIEF HISTORY OF SPACE AND TIME: THE SCOPE-YEAR VALUE INDICATOR BASED

ON FAMILIES AND RENEWALS

http://www.mendeley.com/research/a-brief-history-of-space-and-time-the-scopeyear-index-as-

a-patent-value-indicator-based-on-families-and-renewals/

The renewal of patents and their geographical scope for protection constitute two essential

dimensions in a patent’s life, and probably the most frequently used patent value indicators.

The intertwining of these dimensions (the geographical scope of protection may vary over

time) makes their analysis complex, as any measure along one dimension requires an

arbitrary choice on the second. This paper proposes a new indicator of patent value, the

Scope-Year index, combining the two dimensions. The index is computed for patents filed at

the EPO from 1980 to 1996 and validated in its member states. It shows that the average

value of patent filings has increased in the early eighties but has constantly decreased from

the mid-eighties until the mid nineties, despite the institutional expansion of the EPO. This

result sheds a new and worrying light on the worldwide boom in patent filings.


151

George LAZARIDIS and Bruno VAN POTTELSBERGHE DE LA POTTERIE, 2007, THE

RIGOUR OF EPO'S PATENTABILITY CRITERIA: AN INSIGHT INTO THE "INDUCED

WITHDRAWALS"


The EPO traditionally grants at least 60% of all patent applications, the rest being either

withdrawn (30-35 %) or refused (5%). This paper provides quantitative evidence suggesting

that up to 54% of all patent withdrawals could be considered as induced by the work of EPO

examiners, and hence may be taken as a more appropriate indicator of the rigour of the EPO.

“Induced withdrawals” and refusals occur for up to 23% of all applications at the EPO. This

share varies according to 1) the route chosen for an EPO filing; 2) the technological field that

is considered; and 3) the country of residence of the assignee. The number of claims only

slightly affects the share of withdrawals. However, on average, two additional claims induce an

additional communication from the EPO, which in turn prolongs the procedural duration by an

additional year.

Bart VAN LOOY, Mariëtte DU PLESSIS, Tom MAGERMAN, November 2006, DATA

PRODUCTION METHODS FOR HAMONIZED PATENT STATISTICS: PATENTEE SECTOR

ALLOCATION, KUL Working Paper No. MSI 0606


4

Patent documents are one of the most comprehensive data sources on technology

development. As such, they provide a unique source of information to analyze and monitor

technological performance. Patent indicators are now used by companies and by policy and

government agencies alike to assess technological progress on the level of regions, countries,

domains, and even specific entities such as companies, universities and individual inventors.

In this paper, we develop an exhaustive sector assignment taxonomy to identifying whether

patentees are companies (private business enterprise), universities and higher education

institutions, or governmental agencies. The methodology that we have developed will be

outlined and made fully transparent. It will be shown that the methodology proposed is

effective both in terms of completeness (over 99% of the patent volume of both USPTO and

EPO are assigned to discrete categories) and accuracy (99% of the assigned codes reflect the

category correctly). At the same time, further improvements are considered both feasible and

relevant. In order to ensure that such improvements are put into effect, EUROSTAT and its

development partners (K. U. Leuven and SOGETI) have deliberately chosen to put the

methodology into the public domain. This action is, in effect, an invitation to researchers and


152

analysts to further build on the methodology and to improve it where feasible. When informed

about such improvements, EUROSTAT and its partners will ensure that updates and

refinements of the methodology as a whole are made available to the wider public.

Stuart J.H. GRAHAM, Dietmar HARHOFF, April 2006, CAN POST-GRANT REVIEWS

IMPROVE PATENT SYSTEM DESIGN? A TWIN STUDY OF US AND EUROPEAN PATENTS


This paper assesses the impact of adopting a post-grant review institution in the US patent

system by comparing the “opposition careers” of European Patent Office (EPO) equivalents of

litigated US patents to those of a control group of EPO patents. We demonstrate several novel

methods of "twinning" US and European patents and investigate the implications of employing

these different methods in our data analysis. We find that EPO equivalents of US litigated

patent applications are more likely to be awarded EPO patent protection than are equivalents

of unlitigated patents, and the opposition rate for EPO equivalents of US litigated patents is

about three times higher than for equivalents of unlitigated patents. Patents attacked under

European opposition are shown to be either revoked completely or narrowed in about 70

percent of all cases. For EPO equivalents of US litigated patents, the appeal rate against

opposition outcomes is considerably higher than for control-group patents. Based on our

estimates, we calculate a range of net welfare benefits that would accrue from adopting a

post-grant review system. Our results provide strong evidence that the United States could

benefit substantially from adopting an administrative post-grant patent review, provided that

the post-grant mechanism is not too costly.

Eugenio ARCHONTOPOULOS, Dominique GUELLEC, Niels STEVNSBORG, Bruno VAN

POTTELSBERGHE DE LA POTTERIE, Nicolas VAN ZEEBROECK, 2006, WHEN SMALL IS

BEAUTIFUL: MEASURING THE EVOLUTION AND CONSEQUENCES OF THE

VOLUMINOSITY OF PATENT APPLICATIONS AT THE EPO


The joint increase in the number and size of patents filed around the world puts patent

systems under pressure. This paper addresses issues in measuring the voluminosity of patent

applications and highlights several patterns in its evolution. The results – based on a 2 million

EPO applications database – show that the average size of applications has doubled over the

past 20 years and that it is mainly associated with PCT applications having a US priority.

Voluminosity indicators are also influenced by geographical origins, technological areas, and

various measures of complexity. They strongly impact the workload of the EPO, justifying the

need for regulatory and policy actions.


153

Rainer FRIETSCH, PATENTE IN EUROPA UND DER TRIADE - STRUKTUREN UND

DEREN VERÄNDERUNG - STUDIEN ZUM DEUTSCHEN INNOVATIONSSYSTEM NR. 12-

2006

http://www.bmbf.de/pubRD/sdi-09-07.pdf

Mark A. LEMLEY, Douglas LICHTMAN, Bhaven N. SAMPAT, December 2005, WHAT TO DO

ABOUT BAD PATENTS


At the time patent applications are reviewed, the Patent and Trademark Office has no way of

identifying the small number of applications that are likely to end up having real economic

significance. Thus patent applications are for the most part treated alike, with every application

getting the same - and by necessity sparse - review. In this short magazine piece, we urge in

response three basic reforms. First, we would weaken the presumption of validity that today

attaches to all issued patents. The modern strong presumption simply does not reflect the

reality of patent review; presumptions, in short, should be earned. Second, because legitimate

inventors need as much certainty as the law can provide, we would give applicants the option

of earning a presumption of validity by paying for a thorough examination of their inventions.

Put differently, applicants should be allowed to "gold-plate" their patents by paying for the kind

of searching review that would merit a strong presumption of validity. Third and finally,

because competitors also have useful information about which patents worry them and which

do not, we support instituting a post-grant opposition system, a process by which parties other

than the applicant would have the opportunity to request and fund a thorough examination of a

recently issued patent. As we explain in the piece, these reforms would together allow the

Patent Office to focus its resources on patents that might actually matter, and it would also

both reduce the incentive to file patents of questionable validity and reduce the harm caused

by such patents in any event.

Bronwyn H. HALL and Dietmar HARHOFF, 2004, POST-GRANT REVIEWS IN THE U.S.

PATENT SYSTEM–DESIGN CHOICES AND EXPECTED IMPACT

http://elsa.berkeley.edu/~bhhall/papers/HallHarhoff04BTLJ.pdf

Several policy review boards have advocated the introduction of post-grant patent review

mechanisms in the U.S patent system. We discuss to what extent “patent quality” has been

deteriorating in the U.S. patent system and then consider the expected impact of post-grant

review mechanisms as advocated by the policy review boards. We take a detailed look at the

experience with the opposition mechanism at the European Patent Office. Our results indicate


154

that a properly designed U.S. post-grant review could generate high welfare gains. We discuss

the design choices faced by policy-makers in the United States and provide recommendations.

Wesley M. COHEN, February 2002, PATENTS: THEIR EFFECTIVENESS AND ROLE

http://www.ftc.gov/opp/intellect/cohen.pdf


THE BRITISH LIBRARY'S PATENT COLLECTION

http://www.bl.uk/reshelp/findhelpsubject/busmanlaw/ip/ippatents/patents.html

32. Technology transfer: Public research – Industry

Antoine DECHEZLEPRETRE, Matthieu GLACHANT, Yann MENIERE, February 2009.

TECHNOLOGY TRANSFER BY CDM PROJECTS: A COMPARISON OF BRAZIL, CHINA,

INDIA AND MEXICO, ENERGY POLICY, Elsevier, vol. 37(2), pages 703-711.

http://www.sciencedirect.com/science/article/B6V2W-4V1MFK4-

3/2/90e37ef2f146e28be54e37b3d8b8186f


155

In a companion paper [Dechezleprêtre, A., Glachant, M., Ménière, Y., 2008. The Clean

Development Mechanism and the international diffusion of technologies: An empirical study,

Energy Policy 36, 1273-1283], we gave a general description of technology transfers by Clean

Development Mechanism (CDM) projects and we analyzed their drivers. In this paper, we use

the same data and similar econometric models to explain inter-country differences. We focus

on 4 countries gathering about 75% of the CDM projects: Brazil, China, India and Mexico.

Sixty eight percent of Mexican projects include an international transfer of technology. The

rates are, respectively, 12%, 40% and 59% for India, Brazil and China. Our results show that

transfers to Mexico and Brazil are mainly related to the strong involvement of foreign partners

and good technological capabilities. Besides a relative advantage with respect to these

factors, the higher rate of international transfers in Mexico seems to be due to a sector-

composition effect. The involvement of foreign partners is less frequent in India and China,

where investment opportunities generated by fast growing economies seem to play a more

important role in facilitating international technology transfers through the CDM. International

transfers are also related to strong technology capabilities in China. In contrast, the lower rate

of international transfer (12%) in India may be due to a better capability to diffuse domestic

technologies.

Antoine DECHEZLEPRETRE, Matthieu GLACHANT, Yann MENIERE, April 2008.

THE CLEAN DEVELOPMENT MECHANISM AND THE INTERNATIONAL DIFFUSION OF

TECHNOLOGIES : AN EMPRICAL STUDY

http://www.feem.it/userfiles/attach/Publication/NDL2007/NDL2007-105.pdf

The Clean Development Mechanism (CDM) is expected to stimulate the North-South transfer

of climate-friendly technologies. This paper provides an assessment of the technology

transfers that take place through the CDM using a data set of 644 registered projects. It

provides a detailed description of the transfers (frequency, type, by sector, by host country,

etc.). It also includes an econometric analysis of their drivers. We show that transfer likeliness

increases with the size of the projects. The transfer probability is 50% higher in projects

implemented in a subsidiary of Annex 1 companies while the presence of an official credit

buyer has a lower--albeit positive--impact. The analysis also yields interesting results on how

technological capabilities of the host country influence technology diffusion in the CDM.

Benedikt SCHNELLBÄCHER, Johannes STEPHAN, February 2009, THE ROLE OF THE

INTELLECTUAL PROPERTY RIGHTS REGIME FOR FOREIGN INVESTORS IN POST-

SOCIALIST ECONOMIES

http://www.iwh-halle.de/


156

We integrate international business theory on foreign direct investment (FDI) with institutional

theory on intellectual property rights (IPR) to explain characteristics and behaviour of foreign

investment subsidiaries in Central East Europe, a region with an IPR regime- gap vis-à-vis

West European countries. We start from the premise that FDI may play a crucial role for

technological catch-up development in Central East Europe via technology and knowledge

transfer. By use of a unique dataset generated at the IWH in collaboration with a European

consortium in the framework of an EU-project, we assess the role played by the IPR regimes

in a selection of CEE countries as a factor for corporate governance and control of foreign

invested subsidiaries, for their own technological activity, their trade relationships, and

networking partners for technological activity. As a specific novelty to the literature, we assess

the influence of the strength of IPR regimes on corporate control of subsidiaries and conclude

that IPR-sensitive foreign investments tend to have lower functional autonomy, tend to

cooperate more intensively within their transnational network and yet are still technologically

more active than less IPR sensitive subsidiaries. In terms of economic policy, this leads to the

conclusion that the FDI will have a larger developmental impact if the IPR regime in the host

economy is sufficiently strict.

COMMISSION RECOMMENDATION on the management of intellectual property in

knowledge transfer activities and Code of Practice for universities and other public research

organisations, Brussels, 10.4.2008, C(2008)1329

http://ec.europa.eu/invest-in-research/pdf/ip_recommendation_en.pdf

EU PUSHES FOR BETTER KNOWLEDGE TRANSFER, Friday 11 April 2008

The Commission is hoping that a non-binding Recommendation on intellectual property and

knowledge transfer management will make EU national systems more coherent and boost

transnational academia-industry cooperation to turn more research into lucrative business

results.

http://www.euractiv.com/en/science/eu-pushes-better-knowledge-transfer/article-171564

CLIMATE CHANGE, TECHNOLOGY TRANSFER AND INTELLECTUAL PROPERTY

RIGHTS, 2008, copyright: ICTSD

http://www.iisd.org/pdf/2008/cph_trade_climate_tech_transfer_ipr.pdf

This paper explores how intellectual property rights, particularly as formulated in the rules of

the WTO, affect our ability to successfully address climate change. It was prepared for the

seminar on Trade and Climate Change, June 18-20, 2008, in Copenhagen, co-hosted by the

Government of Denmark, the German Marshall Fund of the United States and IISD. Maria


157

Julia Olivia is lead author of this paper, produced under ICTSD's Global Platform on Linkages

between Trade Policies, Climate Change and Sustainable Energy. Substantive contributions

were received from Ricardo Meléndez-Ortiz, Pedro Roffe, Ahmed Abdel Latif and Moustapha

Kamal Gueye to this paper. Content and editorial review was provided by several other ICTSD

colleagues.

Azèle MATHIEU, Martin MEYER and Bruno VAN POTTELSBERGHE DE LA POTTERIE,

2007, TURNING SCIENCE INTO BUSINESS: A CASE STUDY OF A MAJOR EUROPEAN

RESEARCH UNIVERSITY


The ‘entrepreneurial university’ is an increasingly frequent notion in debates about new ways

of knowledge production and the changing relationships between university, industry and

government. A rich literature has developed exploring outputs of such activity, most notably

‘patenting’, ‘licensing’, and ‘spinouts’. There is also a literature exploring the organisational

process in institutes of higher education (HEI’s). All too often these two streams of literature

ignore each other. The objective of this paper is to make a bridging contribution by exploring

the case of Université Libre de Bruxelles (U.L.B.). The main research question is: Does it pay

to make the entire university entrepreneurial? Our observations suggest that this would be an

effort that could possibly overstretch an institution’s resources. The U.L.B. case illustrates the

potential for nurturing entrepreneurial activities locally as well as the possibilities and

limitations of topdown actions instilling entrepreneurial culture amongst academic rank and file.

EXAMPLES:

UNITED KINGDOM: BAKER GROUP

http://www.ipo.gov.uk/education/education-hfe/education-knowledgetransfer/education-hfe-

knowledge-baker.htm

The Baker Group report looks into the commercialisation of research in the Government's

public sector research establishments (PSREs) and how it can be promoted. It talks about

issues of good practice, the barriers to successful commercialisation, the culture of

entrepreneurship within PSREs and their management of Intellectual Property (IP). It also

studies the relationship between PSREs and sponsor bodies. The report makes

recommendations to how to increase the rate at which PSRE research can be successfully

commercialised.

KNOWLEDGE TRANSFER FROM THE RESEARCH BASE

http://www.berr.gov.uk/dius/science/knowledge-transfer/index.html


158

What is Knowledge transfer?

Within a modern, knowledge driven economy, knowledge transfer is about transferring good

ideas, research results and skills between universities, other research organisations, business

and the wider community to enable innovative new products and services to be developed.

Our mission is to make the most of the UK investment in science, engineering and technology.

Our aim is to promote the transfer of knowledge generated and held in Higher Education

Institutions (HEIs) and Public Sector Research Establishments (PSREs) to the wider economy

to enhance economic growth.

Why is it important?

In parallel with the governments increasing investments in science, there needs to be an

effective two way link between research and the market to ensure that good research

becomes good business. The UK's long term competitiveness demands increased

productivity, invention and innovation and exploitation of the science and engineering base

plays a vital role in supporting DIUS's role of driving up productivity. Knowledge transfer also

generates a return on the investment of public funds in the science research base. It also

enables HEI's.

Making the most of UK Research

A publication has been produced highlighting examples of knowledge transfer from the

research base. These case studies show some of the benefits the UK has gained from its

investment in basic research and how the economy as a whole benefits from researchers

engaging with business to create innovative products and services." The booklet is available

as a PDF file (on the right hand side of this page) or in hard copy from the BERR publications.

GERMANY: PROVENDIS SPEEDS UP THE PROCESS OF TECHNOLOGY TRANSFER

http://www.provendis.info/index.php?id=498&L=3

The objective of PROvendis is to utilise the innovation potential of universities and research

organisations commercially through the transfer of knowledge to companies.

Why is this so important? Because innovations and a scientific edge are the basis for

economic success and prospective jobs. In global competition it is important how quickly and

how well a knowledge edge is converted into a competitive lead. Ultimately both - science as

the supplier of technology and business as user and marketer of the innovation - profit from

technology transfer.

As a patent evaluation agency for 23 universities of North Rhine-Westphalia (Germany)

PROvendis offers companies exclusive access to the inventions and patents of over 20,000

scientists in a wide variety of technology fields. At the same time, PROvendis initiates, follows


159

and supports collaborative projects between research and business to create the prerequisites

for a successful transfer.

PATENT POLICY OF THE HUMBOLDT-UNIVERSITÄT ZU BERLIN

http://research.hu-berlin.de/patents/pl_pol_e.pdf

The goals of the Humbolt-Universität are the protection and the efficient utilisation of university

knowledge. Learning and knowledge are vital aspects of quality and performance in the

development of today’s society. The generation and imparting of knowledge are among the

key tasks of a university.

Innovation and the responsible dealing with the resource ‘knowledge’ are economic factors in

a knowledge based society. Humboldt-Universität is aware of its responsibility to protect and

utilise the knowledge generated by the university. In this it is not primarily the inventor who

needs to act, but rather the university which holds the rights to the invention in question. The

transfer of this knowledge into the industry by a clear and transparent process is the efficient

contribution of the university to society.

FRANCE: FIST CORPORATE

http://www.fist.fr/en

With over sixteen years of experience managing the patent and licensing portfolio of France’s

largest research organization, the Centre Nationale de la Recherche Scientifique (CNRS),

FIST is well-positioned to assist clients from international and domestic companies and

research organizations in effectively moving their most promising technologies toward

commercialization.

With a team of 45 dedicated professionals, FIST is well equipped to analyze your technology

portfolio and ensure its successful development.

FIST’s current activities include:

- Active management of 1500 technologies from a wide range of scientific disciplines.

- Technical and legal analysis of over 300 new technologies per year.

- Management of a portfolio of more than 3200 patent priority filings.

- Tracking of a portfolio of more than 800 contracts and agreements.

- Negotiation and signing of over 100 technology transfer agreements per year

33. Commercial patent information providers

The PatCom Mission http://www.patcom.org/


160

PatCom is an European based and globally acting Commercial Patent Services Group. This

association of commercial patent information providers works to ensure a fair balance between

the free information services of patent offices, commercial value-added patent information

services and users’ interests. PatCom co-operates with industrial user associations such as

PDG and PIUG.

The main objective is achieving the highest quality in issued patents and achieving the

maximum possible dissemination of patent information. PatCom members believe that high

quality patent searching can be achieved only by using a variety of sources and systems.

PatCom has set up working groups for co-operation in commonly important areas like IPC8

Reform, standards and SME training to intensify precompetitive communication in specifically

defined questions and to reach commonly agreed solutions

Grid THOMA, May 2008, A SURVEY OF SOURCES AND DATABASES OF IP

INFORMATION, Working Paper No 69


34. Recent articles on patents

34.1. Euractiv.com EU patent finally sees light – without Spain and Italy [Date: 11-12-2012]

http://www.euractiv.com/innovation-enterprise/eu-patent-finally-sees-light-spa-news-516568

A system that made patent registration up to 60 times more expensive in Europe than in China

is being scrapped in favour of a one-size-fits-all pan-European process. But Spain and Italy

refused to join the scheme because of language concerns.

Parliament and governments block EU patent [Date: 01-09-2010]

http://www.euractiv.com/en/innovation/parliament-and-governments-block-eu-patent-news-

497319

Seven EU countries and the European Parliament have told the European Court of Justice

(ECJ) that the European Commission's plans for a single patent court are unacceptable,

EurActiv has learned. The move leaves Europe deeply divided on an issue that goes to the

heart of efforts to boost innovation and competitiveness.

EU seeks to break patent translation deadlock [Date: 05-07-2010]

http://www.euractiv.com/en/innovation/eu-seeks-break-patent-translation-deadlock-news-

495842


161

Innovative companies could see a dramatic reduction in the cost of patenting new inventions, if

a controversial European Commission plan is adopted by EU governments. The new rules

could pave the way for a single European patent to be issued in one of just three languages –

English, French or German.

European patent applications fall [Date: 28-04-2010]

http://www.euractiv.com/en/innovation/european-patent-applications-fall-news-486307

The number of European patent applications filed last year fell for the first time in 20 years,

according to new figures released by the European Patent Office (EPO).

In 2009, 135,000 applications were received – 8% fewer than in 2008.

The drop in the number of filings from outside the 36 member states of the European Patent

Office (EPO) was sharper (-11%) than for filings from European countries (-5%).

Italy and Spain yesterday (30 May) lodged a complaint with the European Court of

Justice against attempts by other member states to introduce an EU patent without

them. [Date: 31-05-2011]

http://www.euractiv.com/innovation-enterprise/italy-spain-take-patent-fight-court-news-505264

Italy and Spain yesterday (30 May) lodged a complaint with the European Court of Justice

against attempts by other member states to introduce an EU patent without them.

The EU patent scheme (see 'Background') is backed by 25 members but viewed as

discriminatory by Rome and Madrid.

In a statement, the Italian Foreign Ministry said it had lodged the complaint with the court to

defend the values of the union against abuse.

The statement said the use of enhanced co-operation procedure was "never intended to be

stretched to nullify the original aims of the European treaties".

Against the spirit of the single market

It added: "The use of enhanced co-operation within the patent sector is contrary to the spirit of

the single market, because it tends to create division and distortion within the market, and will

thus prejudice Italian businesses."

Supporters of a single EU patent say it is time for the Union to replace the current system,

which forces firms to patent their designs in every one of the bloc's 27 member states and in

23 official languages, at huge expense.


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It is the second time that the courts have waded in to the patent row. Before the enhanced co-

operation procedure had been agreed by member states in March, the Luxembourg court

ruled that the creation of a Community Patent Court would not be compatible with the

provisions of EU law.

Ministers to discuss the move in June

Hungarian Deputy Economy Minister Zoltán Cséfalvay said competitiveness ministers would

discuss the issue at a special meeting on 27 June in Luxembourg.

In response, Internal Market Commissioner Michel Barnier said: "I am confident that the

enhanced co-operation procedure presented by the Commission is not discriminatory. We are

assured that Italian and Spanish business will suffer no discrimination."

34.2. Cordis

PLUTO set to break down barriers to patent information access [Date: 26-05-2010]

http://cordis.europa.eu/fetch?CALLER=EN_NEWS&ACTION=D&SESSION=&RCN=32137

Improving access to multilingual digital patent libraries is the idea behind the new EU-funded

project PLUTO ('Patent language translations online'). The project consortium of five partners

started work on 1 April 2010. Over the next 3 years, it will receive a total of EUR 2.18 million in

funding under the Information and Communication Technologies Policy Support Programme

(ICT-PSP) of the Seventh Framework Programme (FP7) to get an innovative system off the

ground and running.

In order to overcome language barriers that inhibit a more innovative society, the partners are

planning to create a rapid and efficient online translation service. The system will be tailored

specifically to the needs of inventors looking for information on existing patents and other

intellectual property (IP) related matters.

Inventors and small and medium-sized enterprises (SMEs) have to go through a lengthy and

costly process when venturing into a new market. A thorough search for existing patents is a

must, but this is made more difficult by language barriers, the distribution of information

sources over a multitude of sources and - last but not least - the technical and legal expertise

required.

The 'increase of IP-related activities results in an increased and urgent need for tools to cross

language barriers, as language differences are no excuse in cases of infringement,' explain

the project partners. 'In this context, the major risk for an SME is that it will invest all its

resources to enter a particular market, only to discover later that a competitor has a patent in

that market.'


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The online patent search and translation tool to be developed in the framework of PLUTO will

make use of existing web content and the latest machine translation tools. Thanks to its

specialisation, it will be more reliable than general-purpose machine translation tools, while

maintaining their speed advantage over human translations. Ultimately, it will cover all 23

official EU languages.

The academic and industrial project partners from Belgium, Denmark, Ireland, the Netherlands

and Austria bring just the right assets to the table to achieve this mission: a high-performance

machine translation engine; a comprehensive translation software environment; and a

methodology for evaluating machine translation output as well as information retrieval and

patent expertise.

The group will also cooperate closely with the European Patent Office (EPO).

Project officer Susan Fraser at the European Commission says that by funding such pilot

projects through the ICT-PSP programme, the Commission aims to show the public value of

research. 'If PLUTO manages to give small inventors and SMEs the possibility to exploit their

inventions more quickly and at lower cost, it fits perfectly into a sustainable European

innovation strategy,' she explains.

Periodic Report - NANORUCER (Mapping the NANOtechnology innovation system of

RUssia for preparing future Cooperations between the EU and Russia) [Date:

02/09/2011]

http://cordis.europa.eu/search/index.cfm?fuseaction=lib.document&DOC_LANG_ID=EN&DOC

_ID=123237951&pid=0&q=DB5CEFB1BECCF8E4B2F0EF93790E054E&type=sim

The EU is interested in obtaining a survey of main Russian research infrastructures active in

nanotechnology and nano-structured materials as a basis for initiating future cooperations

between the EU and Russia. In the NANORUCER project, two leading organisations from the

EU and Russia in the fields of innovation research and nanotechnology joined forces to deliver

this aim.

Based on a performance analysis using bibliometrics and patent statistics and a careful in

depth mapping of nanotechnology and nano-strucutured materials research activities in

Russia, a strengths and weaknesses analysis of the Russian nanotechnology innovation

system was made in their report. The report also includes a graph, pie chart and table.

34.3. Other EPO and USPTO Work Toward Joint Classification System (2012)


164

http://www.cooperativepatentclassification.org/index.html;jsessionid=12iddiwerh552

The EPO and the USPTO have agreed together to work toward the formation of a partnership

to explore the development of a joint classification system based on the European

Classification system (ECLA) that will incorporate the best classification practices of the two

offices.