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Patents: A Means to Innovation or Strategic Ends?

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  • Jiri Schwarz

    (Institute of Economic Studies, Faculty of Social Sciences, Charles University in Prague, Smetanovo nabrezi 6, 111 01 Prague 1, Czech Republic
    Czech National Bank, Na Prikope 28, 115 03 Prague 1, Czech Republic)

  • Martin Stepanek

    (Institute of Economic Studies, Faculty of Social Sciences, Charles University in Prague, Smetanovo nabrezi 6, 111 01 Prague 1, Czech Republic)

Abstract

This paper utilizes a data set of over 208,000 U.S. patents applied for between 1975 and 2010 to study development of strategic patenting over time and across industries. With received citations as a measure of patent social value, we use data envelopment analysis to estimate firm-level relative importance of strategic versus protective patenting. Our novel identification strategy reveals there was an almost universal drop in patent social value in the second half of the 1990s, signaling a shift towards the strategic use of patents. But the development of patenting strategies continued even after 2000 with semiconductor companies increasing their focus on patent value relative to companies from other industries. On average, aerospace and software companies preferred the production of valuable patents, but patenting strategies can differ vastly even among companies operating within one industry. The results confirm our expectations regarding the focus of aerospace companies on socially valuable patents.

Suggested Citation

  • Jiri Schwarz & Martin Stepanek, 2016. "Patents: A Means to Innovation or Strategic Ends?," Working Papers IES 2016/08, Charles University Prague, Faculty of Social Sciences, Institute of Economic Studies, revised Apr 2016.
    • Handle: RePEc:fau:wpaper:wp2016_08
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    File URL: http://ies.fsv.cuni.cz/sci/publication/show/id/5460/lang/cs
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    More about this item

    Keywords

    Patents; patent value; strategic patenting; intellectual property rights;
    All these keywords.

    JEL classification:

    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • K11 - Law and Economics - - Basic Areas of Law - - - Property Law
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D
    • O34 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital

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