Protecting Their Intellectual Assets: Appropriability Conditions and Why U.S. Manufacturing Firms Patent (Or Not)
Based on a survey questionnaire administered to 1478 R&D labs in the U.S. manufacturing sector in 1994, we find that firms typically protect the profits due to invention with a range of mechanisms, including patents, secrecy, lead time advantages and the use of complementary marketing and manufacturing capabilities. Of these mechanisms, however, patents tend to be the least emphasized by firms in the majority of manufacturing industries, and secrecy and lead time tend to be emphasized most heavily. A comparison of our results with the earlier survey findings of Levin et al.  suggest that patents may be relied upon somewhat more heavily by larger firms now than in the early 1980s. For the protection of product innovations, secrecy now appears to be much more heavily employed across most industries than previously. Our results on the motives to patent indicate that firms patent for reasons that often extend beyond directly profiting from a patented innovation through either its commercialization or licensing. In addition to the prevention of copying, the most prominent motives for patenting include the prevention of rivals from patenting related inventions (i.e., patent blocking'), the use of patents in negotiations and the prevention of suits. We find that firms commonly patent for different reasons in discrete' product industries, such as chemicals, versus complex' product industries, such as telecommunications equipment or semiconductors. In the former, firms appear to use their patents commonly to block the development of substitutes by rivals, and in the latter, firms are much more likely to use patents to force rivals into negotiations.
(This abstract was borrowed from another version of this item.)
References listed on IDEAS
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.:
- Mansfield, Edwin & Schwartz, Mark & Wagner, Samuel, 1981. "Imitation Costs and Patents: An Empirical Study," Economic Journal, Royal Economic Society, vol. 91(364), pages 907-918, December.
- David J. TEECE, 2008.
"Profiting from technological innovation: Implications for integration, collaboration, licensing and public policy,"
World Scientific Book Chapters,in: The Transfer And Licensing Of Know-How And Intellectual Property Understanding the Multinational Enterprise in the Modern World, chapter 5, pages 67-87
World Scientific Publishing Co. Pte. Ltd..
- Teece, David J., 1986. "Profiting from technological innovation: Implications for integration, collaboration, licensing and public policy," Research Policy, Elsevier, vol. 15(6), pages 285-305, December.
- Teece, David J., 1993. "Profiting from technological innovation: Implications for integration, collaboration, licensing and public policy," Research Policy, Elsevier, vol. 22(2), pages 112-113, April.
- David J. Teece, 2003. "Profiting from Technological Innovation: Implications for Integration, Collaboration, Licensing and Public Policy," World Scientific Book Chapters,in: Essays In Technology Management And Policy Selected Papers of David J Teece, chapter 2, pages 11-46 World Scientific Publishing Co. Pte. Ltd..
- Arora, Ashish, 1997.
"Patents, licensing, and market structure in the chemical industry,"
Elsevier, vol. 26(4-5), pages 391-403, December.
- Ashish Arora, 1996. "Patents, Licensing, And Market Structure In The Chemical Industry," Industrial Organization 9605003, EconWPA.
- Kortum, Samuel & Lerner, Josh, 1999. "What is behind the recent surge in patenting?1," Research Policy, Elsevier, vol. 28(1), pages 1-22, January.
- Cohen, Wesley M. & Levin, Richard C., 1989. "Empirical studies of innovation and market structure," Handbook of Industrial Organization,in: R. Schmalensee & R. Willig (ed.), Handbook of Industrial Organization, edition 1, volume 2, chapter 18, pages 1059-1107 Elsevier.
- Jean Lanjouw & Josh Lerner, 1998.
"The Enforcement of Intellectual Property Rights: A Survey of the Empirical Literature,"
Annals of Economics and Statistics,
GENES, issue 49-50, pages 223-246.
- Jean O. Lanjouw & Josh Lerner, 1997. "The Enforcement of Intellectual Property Rights: A Survey of the Empirical Literature," NBER Working Papers 6296, National Bureau of Economic Research, Inc.
- Cohen, Wesley M. & Goto, Akira & Nagata, Akiya & Nelson, Richard R. & Walsh, John P., 2002. "R&D spillovers, patents and the incentives to innovate in Japan and the United States," Research Policy, Elsevier, vol. 31(8-9), pages 1349-1367, December.
- Lerner, Josh, 1995. "Patenting in the Shadow of Competitors," Journal of Law and Economics, University of Chicago Press, vol. 38(2), pages 463-495, October.
- Zvi Griliches, 1998.
"The Search for R&D Spillovers,"
NBER Chapters,in: R&D and Productivity: The Econometric Evidence, pages 251-268
National Bureau of Economic Research, Inc.
- Suzanne Scotchmer, 1991. "Standing on the Shoulders of Giants: Cumulative Research and the Patent Law," Journal of Economic Perspectives, American Economic Association, vol. 5(1), pages 29-41, Winter.
When requesting a correction, please mention this item's handle: RePEc:cla:levarc:618897000000000624. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (David K. Levine)
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.