Effects of patent length on R&D: a quantitative DGE analysis
AbstractThis paper develops an R&D-growth model and calibrates the model to aggregate data of the US economy to quantify a structural relationship between patent length, R&D and consumption. Under parameter values that match the empirical flow-profit depreciation rate of patents and other key features of the US economy, extending the patent length beyond 20 years leads to a negligible increase in R&D despite equilibrium R&D underinvestment. In contrast, shortening the patent length leads to a significant reduction in R&D and consumption. Finally, this paper also analytically derives and quantifies a dynamic distortionary effect of patent length on capital investment.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
Bibliographic InfoArticle provided by Springer in its journal Journal of Economics.
Volume (Year): 99 (2010)
Issue (Month): 2 (March)
Contact details of provider:
Web page: http://www.springerlink.com/link.asp?id=108909
Innovation-driven growth; Intellectual property rights; Patent length; R&D; O31; O34;
Other versions of this item:
- Angus C. Chu, 2009. "Effects of Patent Length on R&D: A Quantitative DGE Analysis," IEAS Working Paper : academic research 09-A001, Institute of Economics, Academia Sinica, Taipei, Taiwan, revised Dec 2009.
- Chu, Angus C., 2009. "Effects of Patent Length on R&D: A Quantitative DGE Analysis," MPRA Paper 16918, University Library of Munich, Germany.
- O34 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital
- O31 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Diego Comin, 2003.
"R&D? A Small Contribution to Productivity Growth,"
- Jones, Charles I, 1995. "R&D-Based Models of Economic Growth," Journal of Political Economy, University of Chicago Press, vol. 103(4), pages 759-84, August.
- Bessen, James, 2008.
"The value of U.S. patents by owner and patent characteristics,"
Elsevier, vol. 37(5), pages 932-945, June.
- James Bessen, 2006. "The Value of U.S. Patents by Owner and Patent Characteristics," Working Papers 0603, Research on Innovation.
- Ted O'Donoghue & Josef Zweim¸ller, 2004.
"Patents in a Model of Endogenous Growth,"
Journal of Economic Growth,
Springer, vol. 9(1), pages 81-123, 03.
- Rachel Ngai & Roberto Samaniego, 2011.
"Accounting for Research and Productivity Growth Across Industries,"
Review of Economic Dynamics,
Elsevier for the Society for Economic Dynamics, vol. 14(3), pages 475-495, July.
- L. Rachel Ngai & Roberto M. Samaniego, 2009. "Accounting for research and productivity growth across industries," LSE Research Online Documents on Economics 25496, London School of Economics and Political Science, LSE Library.
- Rachel Ngai & Roberto Samaniego, 2009. "Code files for "Accounting for Research and Productivity Growth Across Industries"," Computer Codes 09-126, Review of Economic Dynamics.
- L. Rachel Ngai & Roberto M. Samaniego, 2009. "Accounting for Research and Productivity Growth Across Industries," CEP Discussion Papers dp0914, Centre for Economic Performance, LSE.
- Rivera-Batiz, Luis A & Romer, Paul M, 1991.
"Economic Integration and Endogenous Growth,"
The Quarterly Journal of Economics,
MIT Press, vol. 106(2), pages 531-55, May.
- Nancy T. Gallini, 2002. "The Economics of Patents: Lessons from Recent U.S. Patent Reform," Journal of Economic Perspectives, American Economic Association, vol. 16(2), pages 131-154, Spring.
- Romer, Paul M, 1990.
"Endogenous Technological Change,"
Journal of Political Economy,
University of Chicago Press, vol. 98(5), pages S71-102, October.
- Judd, Kenneth L, 1985. "On the Performance of Patents," Econometrica, Econometric Society, vol. 53(3), pages 567-85, May.
- Futagami, Koichi & Iwaisako, Tatsuro, 2007. "Dynamic analysis of patent policy in an endogenous growth model," Journal of Economic Theory, Elsevier, vol. 132(1), pages 306-334, January.
- Charles I. Jones & John C. Williams, .
"Measuring the Social Return to R&D,"
97002, Stanford University, Department of Economics.
- Kwan, Yum K. & Lai, Edwin L. -C., 2003. "Intellectual property rights protection and endogenous economic growth," Journal of Economic Dynamics and Control, Elsevier, vol. 27(5), pages 853-873, March.
- Charles I. Jones, .
"Growth: With or Without Scale Effects?,"
99001, Stanford University, Department of Economics.
- Daron Acemoglu, 2007. "Introduction to Modern Economic Growth," Levine's Bibliography 122247000000001721, UCLA Department of Economics.
- Susanto Basu & John G. Fernald, 1996.
"Returns to scale in U.S. production: estimates and implications,"
International Finance Discussion Papers
546, Board of Governors of the Federal Reserve System (U.S.).
- Basu, Susanto & Fernald, John G, 1997. "Returns to Scale in U.S. Production: Estimates and Implications," Journal of Political Economy, University of Chicago Press, vol. 105(2), pages 249-83, April.
- Adam B. Jaffe & Josh Lerner, 2006.
"Innovation and its Discontents,"
in: Innovation Policy and the Economy, Volume 6, pages 27-66
National Bureau of Economic Research, Inc.
- Jones, Charles I, 1995. "Time Series Tests of Endogenous Growth Models," The Quarterly Journal of Economics, MIT Press, vol. 110(2), pages 495-525, May.
- Shiyuan Pan & Heng-fu Zou & Tailong Li, 2010. "Patent Protection, Technological Change and Wage Inequality," CEMA Working Papers 437, China Economics and Management Academy, Central University of Finance and Economics.
- Chu, Angus C. & Leung, Charles K.Y. & Tang, Edward, 2012.
"Intellectual property rights, technical progress and the volatility of economic growth,"
Journal of Macroeconomics,
Elsevier, vol. 34(3), pages 749-756.
- Chu, Angus C. & Leung, Charles Ka Yui & TANG, C. H. Edward, 2012. "Intellectual property rights, technical progress and the volatility of economic growth," MPRA Paper 38132, University Library of Munich, Germany.
- Angus C. Chu, 2009.
"Macroeconomic Effects of Intellectual Property Rights: A Survey,"
IEAS Working Paper : academic research
09-A007, Institute of Economics, Academia Sinica, Taipei, Taiwan.
- Chu, Angus C., 2009. "Macroeconomic Effects of Intellectual Property Rights: A Survey," MPRA Paper 17342, University Library of Munich, Germany.
- Chu, Angus C., 2009.
"The welfare cost of one-size-fit-all patent protection,"
21401, University Library of Munich, Germany, revised Mar 2010.
- Chu, Angus C., 2011. "The welfare cost of one-size-fits-all patent protection," Journal of Economic Dynamics and Control, Elsevier, vol. 35(6), pages 876-890, June.
- Furukawa, Yuichi, 2010. "Intellectual property protection and innovation: an inverted-U relationship," Economics Letters, Elsevier, vol. 109(2), pages 99-101, November.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Guenther Eichhorn) or (Christopher F. Baum).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.