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Science and the Market for Technology

Author

Listed:
  • Ashish Arora
  • Sharon Belenzon
  • Jungkyu Suh

Abstract

Well functioning Markets for Technology (MFT) allow inventors to sell their inventions to others that may derive more value from them. We argue that the growing reliance on science in inventions enhances MFT. In addition to higher quality inventions, reliance on science may enhance gains from trade and reduce the transfer cost of knowledge and other transaction costs. Using large scale data, we show that patents citing science are more likely to be traded, especially for novel patents and for smaller inventors. Leveraging the fall of the Berlin Wall as a source of exogenous variation in the relevant scientific knowledge to technological fields, we confirm reliance on science increases the likelihood that the invention will be traded

Suggested Citation

  • Ashish Arora & Sharon Belenzon & Jungkyu Suh, 2021. "Science and the Market for Technology," NBER Working Papers 28534, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:28534
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    Citations

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    Cited by:

    1. Krzysztof Szczygielski & Jerzy Mycielski, 2024. "The mutual reinforcement of scientific and technological knowledge—a technology-level analysis," Scientometrics, Springer;Akadémiai Kiadó, vol. 129(11), pages 6533-6549, November.
    2. Wang, Dan & Zhou, Xiao & Zhao, Pengwei & Pang, Juan & Ren, Qiaoyang, 2025. "Early identification of breakthrough technologies: Insights from science-driven innovations," Journal of Informetrics, Elsevier, vol. 19(1).
    3. Xuan Leng & Yichuan Zhang, 2024. "The Frontiers in Manufacturing Technologies Initiative and University Innovation," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 32(5), pages 197-225, September.
    4. Kim, Young-Choon & Kotha, Reddi & Rhee, Mooweon, 2024. "Do firms with technological capabilities rush in? Evidence from the timing of licensing of Stanford inventions," Journal of Business Research, Elsevier, vol. 178(C).
    5. Wu, Xiaokang & Yu, Jinping, 2023. "Does dialect difference impede patent transaction? Evidence from China's inter-city patent license data," Technological Forecasting and Social Change, Elsevier, vol. 187(C).
    6. Kim, Jinhwan & Valentine, Kristen, 2023. "Public firm disclosures and the market for innovation," Journal of Accounting and Economics, Elsevier, vol. 76(1).
    7. Ziyou Teng & Xuezhong Zhu, 2024. "Measuring the global and domestic technological impact of Chinese scientific output: a patent-to-paper citation analysis of science-technology linkage," Scientometrics, Springer;Akadémiai Kiadó, vol. 129(9), pages 5181-5210, September.
    8. Wu, Xiaokang & Yang, Jijun, 2023. "High-speed railway and patent trade in China," Economic Modelling, Elsevier, vol. 123(C).
    9. Wernsdorf, Kathrin & Nagler, Markus & Watzinger, Martin, 2022. "ICT, collaboration, and innovation: Evidence from BITNET," Journal of Public Economics, Elsevier, vol. 211(C).
    10. 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).

    More about this item

    JEL classification:

    • L24 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Contracting Out; Joint Ventures
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O34 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital
    • O36 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Open Innovation

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