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.:
- Zvi Griliches, 1998.
"The Search for R&D Spillovers,"
in: R&D and Productivity: The Econometric Evidence, pages 251-268
National Bureau of Economic Research, Inc.
- Teece, David J., 1986.
"Profiting from technological innovation: Implications for integration, collaboration, licensing and public 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.
- 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. & 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.
- Ashish Arora, 1996.
"Patents, Licensing, And Market Structure In The Chemical Industry,"
- Arora, Ashish, 1997. "Patents, licensing, and market structure in the chemical industry," Research Policy, Elsevier, vol. 26(4-5), pages 391-403, December.
- 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.
- 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.
- 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.
- 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.
- 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.
- 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.
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 references are entirely missing, you can add them using this form.