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on Intellectual Property Rights |
| By: | Gaetan de Rassenfosse; Bruno van Pottelsberghe de la Potterie |
| Abstract: | 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. |
| Keywords: | patent cost, patenting fees, price elasticity, patent systems, propensity to patent |
| JEL: | O34 O30 O31 O38 O57 |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:eca:wpaper:2008_031&r=ipr |
| By: | Klaus M. Schmidt; (Department of Economics, University of Munich, Ludwigstrasse 28, D-80539 Muenchen, Germany; ) |
| Abstract: | Many high technology goods are based on standards that require access to several patents that are owned by different IP holders. We investigate the royalties chosen by IP holders under different market structures. Vertical integration of an IP holder and a downstream producer solves the double mark-up problem between these firms. Nevertheless, it may raise royalty rates and reduce output as compared to non-integration. Horizontal integration of IP holders (or a patent pool) solves the complements problem but not the double mark-up problem. Vertical integration discourages entry and reduces innovation incentives, while horizontal integration always encourages entry and innovation. |
| Keywords: | IP rights, complementary patents, standards, licensing, patent pool, vertical integration |
| JEL: | L15 O31 L24 O32 K11 |
| Date: | 2008–09 |
| URL: | http://d.repec.org/n?u=RePEc:trf:wpaper:249&r=ipr |
| By: | Gautier Duflos (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I, EEP-PSE - Ecole d'Économie de Paris - Paris School of Economics - Ecole d'Économie de Paris); Etienne Pfister (BETA-Règles - Université de Nancy II) |
| Abstract: | This article analyzes the individual determinants of acquisition activity and target choices in the pharmaceutical industry over the period 1978-2002. The "innovation gap" hypothesis states that acquiring firms lack promising drug compounds and acquire firms with more promising drug prospects. A duration model implemented over a panel of more than 400 firms relates the probabilities of being an purchaser or a target to financial, R&D ant patent data to investigate this explanation more deeply. Results show that purchasers are firms with a lower Tobin's Q and decreasing sales, which could indicate that acquisitions are used to compensate for low internal growth prospects. Firms with a higher proportion of radical patents in their portfolio, especially in pharmaceutical and biothechnological patent classes, face a higher probability of being targeted, indicating that acquiring firms are indeed searching for innovative competencies. However, acquiring firms also present a significant absorptive capacity : their R&D investment increases in the year preceding the operation and their patent stock is larger and more diversified than for non-acquiring firms. Finally, we observe that over the last ten years of the sample period, firms have paid a greater attention to the size of the target's portfolio. |
| Keywords: | M&A, pharmaceutical, innovations, patent citations. |
| Date: | 2008–09 |
| URL: | http://d.repec.org/n?u=RePEc:hal:paris1:halshs-00331211_v1&r=ipr |
| By: | Michael Rothgang |
| Abstract: | The EU Barcelona target assumes a close causal relationship between corporate R&D, the competitiveness of business firms and the economic performance of industrial countries. Testing this hypothesis, this paper contrasts innovation and production activities in four research-intensive manufacturing sectors (chemicals and pharmaceuticals, motor vehicles, machinery, and electrical engineering). Starting point are observed long-term changes in worldwide value added of the manufacturing sector.The empirical analysis is based on a unique survey of R&D-intensive business firms in Germany and 50 personal interviews in large industrial companies. The results show that there is no simple connection between R&D and competitiveness. Moreover, the likely consequences of promoting R&D differ substantially between industries. |
| Keywords: | Sectoral innovation systems, corporate R&D Strategies, chemicals and pharmaceuticals, machinery, electrical engineering,motor vehicles, bazaar effect |
| JEL: | L6 O23 R32 |
| Date: | 2008–08 |
| URL: | http://d.repec.org/n?u=RePEc:rwi:repape:0059&r=ipr |
| By: | Oliviero A. Carboni |
| Abstract: | This paper uses a comprehensive firm level data set for the manufacturing sector in Italy to investigate the effect of government support on privately financed R&D expenditure. Estimates from a two-step equation model suggest that public assistance has a positive effect on private R&D investment. A non parametric matching procedure is also used to investigate the same effect. Here again the results suggest that the recipient firms achieve more private R&D than they would have without public support. The paper also examines whether public funding effects the financial sources available for R&D and finds that grants encourage credit financing for R&D. The effects on the use of internal sources are not conclusive. |
| Keywords: | Applied Econometrics, matching, public subsidies, R&D investment |
| JEL: | C24 L10 O30 O31 O38 |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:cns:cnscwp:200815&r=ipr |
| By: | Jeroen de Jong; Eric von Hippel |
| Abstract: | The contribution of this paper is threefold. Firstly, we measure the incidence of user innovation in a broad sample of firms. Previous work has collected repeated evidence on the frequency of user innovation in a variety of industries and products, but so far its incidence has not been demonstrated in samples of larger business populations. Secondly, we assess if current innovation surveys adequately capture user innovation. Surveys such as the CIS (Community Innovation Survey) take a producer perspective and seem to overlook that in practice many innovation efforts are done by users to satisfy their process needs. Thirdly, we explore to what extent user innovations are transferred to producer firms. In doing so we assess if user innovation is marked by voluntary spillovers which is a strong argument to justify policies for user innovation. Drawing on survey data of 2 416 SMEs in the Netherlands, we find that 21% of all SMEs engage in user innovation, i.e. they develop and/or significantly modify existing techniques, equipment or software to satisfy their own process-related needs. We also find that user innovation is remains largely invisible in the current innovation surveys. Next, in a survey of technology-based small firms in the Netherlands we identified 364 specific user innovations. We found that users tend not to patent or protect their innovations, and that one out of four is transferred to producers. The data suggest a significant feedstock of voluntary knowledge spillovers from users to producer firms. We conclude that future innovation surveys should explicitly capture user innovation, and develop some recommendations to guide this effort. We also plea for more research on policies for user innovation. |
| Date: | 2008–10–21 |
| URL: | http://d.repec.org/n?u=RePEc:eim:papers:h200814&r=ipr |
| By: | Ernest Miguélez (Faculty of Economics, University of Barcelona); Rosina Moreno (Faculty of Economics, University of Barcelona); Manuel Artís (Faculty of Economics, University of Barcelona) |
| Abstract: | In this paper we seek to verify the hypothesis that trust and cooperation between individuals, and between them and public institutions, can encourage technological innovation and the adoption of knowledge. Additionally, we test the extent to which the interaction of social capital with human capital and R&D expenditures improve their effect on a region’s ability to innovate. Our empirical evidence is taken from the Spanish regions and employs a knowledge production function and longitudinal count data models. Our results suggest that social capital correlates positively with innovation. Further, our analysis reveals a powerful interaction between human and social capital in the production of knowledge, whilst the complementarity with R&D efforts would seem less clear. |
| Keywords: | social capital, human capital, innovation, complementarities. |
| Date: | 2008–10 |
| URL: | http://d.repec.org/n?u=RePEc:ira:wpaper:200813&r=ipr |
| By: | David Encaoua (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I); Yassine Lefouili (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I) |
| Abstract: | In this paper we examine the implications of uncertainty over patent validity on patentholders' licensing strategies. Two licensing mechanisms are examined: per-unit royalty and up-front fee.We provide conditions under which uncertain patents are licensed in order to avoid patent litigation. It is shown that while it is possible for the patentholder to reap som e "extra profit" by selling an uncertain patent under the pure per-unit royalty regime, the opportunity to do so does not exist under a pure up-front fee regime. We also establish that the relatively high bargaining power the licensor has even when its patent is weak can be reduced if the patentholder cannot refuse to license an unsucessful challenger or if collective challenges are allowed for. Furthermore we show that the patentee may prefer to license through the per-unit royalty mechanism rather than the fixed fee mechanism, especially if its patent is weak. This finding contradicts the traditional theoretical result that fixed fee licensing dominates royalty rate licensing from the patentholder's perspective. |
| Date: | 2008–07 |
| URL: | http://d.repec.org/n?u=RePEc:hal:paris1:hal-00318208_v1&r=ipr |
| By: | Giammario Impullitti |
| Abstract: | The geographical distribution of R&D investment changes dramatically in the 1970s and 1980s. In the early 1970s U.S. firms are the uncontested world leaders in R&D investment in most manufacturing sectors. Later, led by Japan and Europe, foreign firms start challenging American R&D leadership in many sectors of the economy. In this period of increasing competition we also observe a substantial increase in the U.S. R&D subsidy. In a version of the multi-country quality ladder growth model I study the effects of foreign R&D competition on domestic welfare and on the optimal R&D subsidy. I build a new empirical index of international R&D rivalry that can be used to perform quantitative analysis in this type of frameworks. In a calibrated version of the model I focus on the period 1979-1991 and perform the following quantitative exercises: first, I evaluate the quantitative effects of the observed increase in foreign R&D competition on U.S. welfare. I find that the positive growth effect and the negative business-stealing effect of foreign competition on U.S. welfare substantially balance each other, and the overall welfare effect of competition is negligible - less then 1 percent of per-capita consumption. Moreover, using estimates of the effective U.S. R&D subsidy rate, I compute the distance from optimality of the observed subsidy at each level of competition. I find that international competition increases the optimal subsidy and that, surprisingly, the U.S. subsidy observed in the data is fairly close to the optimal subsidy. |
| Date: | 2008–06 |
| URL: | http://d.repec.org/n?u=RePEc:fda:fdacee:15-08&r=ipr |
| By: | Metiu, Anca (ESSEC Business School); Fayard, Anne-Laure (Polytechnic Institute of New York University) |
| Abstract: | We enter the debate about the possibility of collaboration and of rich exchanges among physically distant individuals by offering a literacy perspective on communication to show how the dimensions of writing enable the development of scientific communities. We illustrate this perspective with an analysis of the correspondences of one philosopher and one scientist – Descartes and Emilie du Chatelet, as well as with a description of one of the most prominent communities of scientists and philosophers in Europe, the Republic of Letters. Our findings show that writing is essential for the expression and exchange of ideas, abstractions, complex thoughts, demonstrations, arguments – in sum, for the entire scientific enterprise. We discuss the implications of the literacy perspective and of our findings for the current understanding of online intellectual communities. |
| Keywords: | Orality and Literacy; Scientific Communities; Online Communities; Letters; Organizational Communication |
| JEL: | Z13 |
| Date: | 2008–10 |
| URL: | http://d.repec.org/n?u=RePEc:ebg:essewp:dr-08016&r=ipr |
| By: | Malwina Mejer; Bruno van Pottelsberghe de la Potterie |
| Abstract: | This paper analyses the consequences for the European Patent System (EPS) of the recently ratified London Agreement (LA), which aims to reduce the translation requirements for patent validation procedures in 15 out of 34 national patent offices. The simulations suggest that the cost of patenting has been reduced by 20 to 30 percent since the enforcement of the LA. With an average translation cost saving of €3,600 per patent, the total savings for the business sector amount to about €220 millions. The fee elasticity of patents being about -0.4, one may expect an increase in patent filings of eight to 12 percent. Despite the translation cost savings, the relative cost of a European patent validated in six (thirteen) countries is still at least five (seven) times higher than in the United States. |
| Keywords: | European patent system, London Agreement, patent fees, translation costs, fee elasticity |
| JEL: | P14 P51 O34 |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:eca:wpaper:2008_032&r=ipr |