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Science Quality and the Value of Inventions

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  • Felix Poege
  • Dietmar Harhoff
  • Fabian Gaessler
  • Stefano Baruffaldi

Abstract

Despite decades of research, the relationship between the quality of science and the value of inventions has remained unclear. We present the result of a large-scale matching exercise between 4.8 million patent families and 43 million publication records. We find a strong positive relationship between quality of scientific contributions referenced in patents and the value of the respective inventions. We rank patents by the quality of the science they are linked to. Strikingly, high-rank patents are twice as valuable as low-rank patents, which in turn are about as valuable as patents without direct science link. We show this core result for various science quality and patent value measures. The effect of science quality on patent value remains relevant even when science is linked indirectly through other patents. Our findings imply that what is considered "excellent" within the science sector also leads to outstanding outcomes in the technological or commercial realm.

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  • Felix Poege & Dietmar Harhoff & Fabian Gaessler & Stefano Baruffaldi, 2019. "Science Quality and the Value of Inventions," Papers 1903.05020, arXiv.org, revised Apr 2019.
    • Handle: RePEc:arx:papers:1903.05020
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    Cited by:

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    2. Schnitzer, Monika & Krieger, Joshua & Watzinger, Martin, 2019. "Standing on the shoulders of science," CEPR Discussion Papers 13766, C.E.P.R. Discussion Papers.
    3. Niclas Berggren & Christian Bjørnskov, 2022. "Academic freedom, institutions, and productivity," Southern Economic Journal, John Wiley & Sons, vol. 88(4), pages 1313-1342, April.
    4. Fernández, Ana María & Ferrándiz, Esther & Medina, Jennifer, 2022. "The diffusion of energy technologies. Evidence from renewable, fossil, and nuclear energy patents," Technological Forecasting and Social Change, Elsevier, vol. 178(C).
    5. Kathrin Wernsdorf & Markus Nagler & Martin Watzinger, 2020. "ICT, Collaboration, and Science-Based Innovation: Evidence from BITNET," CESifo Working Paper Series 8646, CESifo.
    6. Charles Ayoubi & Boris Thurm, 2023. "Knowledge diffusion and morality: Why do we freely share valuable information with Strangers?," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 32(1), pages 75-99, January.
    7. Lichter, Andreas & Löffler, Max & Isphording, Ingo Eduard & Nguyen, Thu-Van & Poege, Felix & Siegloch, Sebastian, 2021. "Profit taxation, R&D spending, and innovation," ZEW Discussion Papers 21-080, ZEW - Leibniz Centre for European Economic Research.
    8. Nasirov, Shukhrat & Joshi, Amol M., 2023. "Minding the communications gap: How can universities signal the availability and value of their scientific knowledge to commercial organizations?," Research Policy, Elsevier, vol. 52(9).
    9. Matt Marx & Aaron Fuegi, 2020. "Reliance on science: Worldwide front‐page patent citations to scientific articles," Strategic Management Journal, Wiley Blackwell, vol. 41(9), pages 1572-1594, September.
    10. Shin, Seungryul Ryan & Lee, Jisoo & Jung, Yura Rosemary & Hwang, Junseok, 2022. "The diffusion of scientific discoveries in government laboratories: The role of patents filed by government scientists," Research Policy, Elsevier, vol. 51(5).
    11. Arora, Ashish & Belenzon, Sharon & Dionisi, Bernardo, 2023. "First-mover advantage and the private value of public science," Research Policy, Elsevier, vol. 52(9).
    12. Sebastian Erhardt & Mainak Ghosh & Erik Buunk & Michael E. Rose & Dietmar Harhoff, 2023. "Logic Mill - A Knowledge Navigation System," Rationality and Competition Discussion Paper Series 440, CRC TRR 190 Rationality and Competition.
    13. Jianhua Hou & Xiucai Yang & Haoyang Song & Haiyue Yao, 2023. "Will patent family be dormant? Research on the identification and characteristics of sleeping beauty’s patent family," Scientometrics, Springer;Akadémiai Kiadó, vol. 128(10), pages 5361-5387, October.
    14. Hötte, Kerstin & Pichler, Anton & Lafond, François, 2021. "The rise of science in low-carbon energy technologies," Renewable and Sustainable Energy Reviews, Elsevier, vol. 139(C).
    15. Wernsdorf, Kathrin & Nagler, Markus & Watzinger, Martin, 2022. "ICT, collaboration, and innovation: Evidence from BITNET," Journal of Public Economics, Elsevier, vol. 211(C).
    16. Nishimura, Junichi & Nagaoka, Sadao & Yoneyama-Hirozane, Mariko, 2022. "The impact of science-intensive drugs on longevity and cure rate: Evidence from new prescription drugs launched in Japan," Journal of the Japanese and International Economies, Elsevier, vol. 64(C).
    17. Mauro G. Carta & Matthias C. Angermeyer & Silvano Tagliagambe, 2021. "The Trend of Scientific Productivity of Chinese, European Union, and United States Universities and Private Companies: Does the Future Belong to E-Technology Companies?," Publications, MDPI, vol. 9(2), pages 1-14, April.
    18. Matt Marx & Aaron Fuegi, 2022. "Reliance on science by inventors: Hybrid extraction of in‐text patent‐to‐article citations," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 31(2), pages 369-392, April.
    19. Rachel Heyard & Hanna Hottenrott, 2021. "The value of research funding for knowledge creation and dissemination: A study of SNSF Research Grants," Palgrave Communications, Palgrave Macmillan, vol. 8(1), pages 1-16, December.
    20. Sheer, Lia, 2022. "Sitting on the Fence: Integrating the two worlds of scientific discovery and invention within the firm," Research Policy, Elsevier, vol. 51(7).

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