Exploring the validity of patent applications as an indicator of Chinese competitiveness and market structure

An increasing number of studies are using either worldwide Chinese patent applications as an indicator to assess the country's international competitiveness or applications at the Chinese SIPO as an indicator of the internal structure of innovative activities on its domestic market. Whenever such macro level studies are presented, however, many practitioners tend to express disbelief regarding the validity of patent indicators in this emerging market, where IPR protection is perceived to play a role that differs strongly from that in other economies. This paper, therefore, compares the structure of both patent applications at the Chinese national office and global applications by Chinese inventors. Moreover, it contrasts Chinese application activities with those of other nations. On this basis, it analyses if there is evidence of different underlying motivations for and logics of application that would substantiate such doubts. It concludes that, following WTO accession, the Chinese technology market is finding its specific equilibrium but retains certain persistent particularities. Global filings of Chinese applicants, in contrast, remain biased towards the few major firms that can compete at the world markets for technology.