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Estimating The Gains From Trade In The Market For Patent Rights

Author

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  • Carlos J. Serrano

Abstract

The “market for patents”—the sale of patents—is an often discussed source of incentives to invest in R&D. This article presents and estimates a model of the transfer and renewal of patents that, under some assumptions, allows me to quantify the gains resulting from the transfer of patents. The gains from trade measure the private benefits of reallocating the ownership of a patent from the original patentee to a new owner for whom the patent has a higher value. In addition, I study the effect that lowering transaction costs has on the proportion of patents traded and the gains from trade.

Suggested Citation

  • Carlos J. Serrano, 2018. "Estimating The Gains From Trade In The Market For Patent Rights," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 59(4), pages 1877-1904, November.
    • Handle: RePEc:wly:iecrev:v:59:y:2018:i:4:p:1877-1904
    DOI: 10.1111/iere.12338
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    Citations

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    Cited by:

    1. Hutschenreiter, Dennis, 2026. "Common ownership, tacit know-how, and the market for technology," IWH Discussion Papers 3/2026, Halle Institute for Economic Research (IWH).
    2. Caviggioli, Federico & De Marco, Antonio & Montobbio, Fabio & Ughetto, Elisa, 2020. "The licensing and selling of inventions by US universities," Technological Forecasting and Social Change, Elsevier, vol. 159(C).
    3. Jung H. Kwon & Haemin Dennis Park & Shu Deng, 2022. "When Do Firms Trade Patents?," Organization Science, INFORMS, vol. 33(3), pages 1212-1231, May.
    4. Antelo, Manel & Bru, Lluís, 2025. "Optimal transfer of a quality-enhancing innovation in a vertical related market," MPRA Paper 126850, University Library of Munich, Germany, revised Sep 2025.
    5. Tao Hu & Yin Zhang, 2021. "A spatial–temporal network analysis of patent transfers from U.S. universities to firms," Scientometrics, Springer;Akadémiai Kiadó, vol. 126(1), pages 27-54, January.
    6. Antelo, Manel & Bru, Lluís, 2024. "On the size of innovation and selling versus licensing," MPRA Paper 122731, University Library of Munich, Germany.
    7. Cai, Zhishan & Ma, Ding & Zhou, Rui & Zhang, Zhiwang, 2024. "Unraveling the impact of patent transfers on regional innovation: Empirical insights through the lens of entity relationships," Technological Forecasting and Social Change, Elsevier, vol. 208(C).
    8. Tesoriere, Antonio, 2019. "Stable sharing rules and participation in pools of essential patents," Games and Economic Behavior, Elsevier, vol. 117(C), pages 40-58.
    9. Hutschenreiter, Dennis, 2023. "Common Ownership and the Market for Technology," VfS Annual Conference 2023 (Regensburg): Growth and the "sociale Frage" 277640, Verein für Socialpolitik / German Economic Association.
    10. Wu, Xiaokang & Yang, Jijun, 2023. "High-speed railway and patent trade in China," Economic Modelling, Elsevier, vol. 123(C).
    11. David S. Abrams & Ufuk Akcigit & Gokhan Oz & Jeremy G. Pearce, 2019. "The Patent Troll: Benign Middleman or Stick-Up Artist?," NBER Working Papers 25713, National Bureau of Economic Research, Inc.
    12. Ashish Arora & Sharon Belenzon & Jungkyu Suh, 2022. "Science and the Market for Technology," Management Science, INFORMS, vol. 68(10), pages 7176-7201, October.
    13. Mai, Yirui & Yu, Kaidong & Zhang, Xuan, 2024. "Enhancing corporate carbon performance through green innovation and digital transformation: Evidence from China," International Review of Economics & Finance, Elsevier, vol. 96(PB).

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