IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Log in (now much improved!) to save this paper

A Study of Patent Thickets

  • Dr Chiara Rosazza Bondibene

    ()

Registered author(s):

    This report analyses whether entry of UK enterprises into patenting in a technology area is affected by patent thickets in the technology area. The aim is to contribute to our understanding of the role of patent thickets as a barrier to entry into patenting for UK enterprises, in particular small and medium sized enterprises (SMEs). To do this we review the literature on patent thickets, discuss factors contributing to thicket formation and growth, and evaluate to what extent patent thickets might be considered to be barriers to entry in some technology areas. We also summarize the limited existing empirical evidence regarding effects of patent thickets on R&D investments and competition. We find overwhelming evidence in the literature that patent thickets arise in specific technology areas. This conclusion is based on a comprehensive review of the empirical literature on patent thickets of the last 15 years. This literature consists of surveys of firm representatives as well as of econometric analyses of firm level data. The literature on thickets contains more than 100 peer reviewed papers and a number of extensive studies undertaken by competition regulators. Our main contribution in this study consists of an empirical analysis of the effects of patent thickets at the European Patent Office on entry into patenting by UK firms. Using a new measure of patent thickets developed by Graevenitz et al. (2012), the report provides a descriptive analysis of the growth of patent thickets in the European patent system and an analysis of the exposure to these thickets of UK entrants into patenting. Econometric analysis of the probability of entry into patenting by technology area shows that the density of a patent thicket is associated with reduced entry into patenting in the technology area in the data set used for this study. We discuss limitations of the data used and suggest how further work might test the reliability of our findings.

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

    File URL: http://www.niesr.ac.uk/sites/default/files/publications/dp401_0.pdf
    Download Restriction: no

    Paper provided by National Institute of Economic and Social Research in its series NIESR Discussion Papers with number 401.

    as
    in new window

    Length:
    Date of creation: Oct 2012
    Date of revision:
    Handle: RePEc:nsr:niesrd:11129
    Contact details of provider: Postal:
    2 Dean Trench Street Smith Square London SW1P 3HE

    Web page: http://niesr.ac.uk

    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.:

    as in new window
    1. Natarajan Balasubramanian & Jagadeesh Sivadasan, 2011. "What Happens When Firms Patent? New Evidence from U.S. Economic Census Data," The Review of Economics and Statistics, MIT Press, vol. 93(1), pages 126-146, February.
    2. Dietmar Harhoff & Stefan Wagner, 2009. "The Duration of Patent Examination at the European Patent Office," Management Science, INFORMS, vol. 55(12), pages 1969-1984, December.
    3. Bronwyn H. Hall, 2004. "Exploring the Patent Explosion," NBER Working Papers 10605, National Bureau of Economic Research, Inc.
    4. Nicholas, Tom, 2011. "Cheaper patents," Research Policy, Elsevier, vol. 40(2), pages 325-339, March.
    5. Benjamin F. Jones, 2010. "Age and Great Invention," The Review of Economics and Statistics, MIT Press, vol. 92(1), pages 1-14, February.
    6. Wesley M Cohen & Richard R Nelson & John P Walsh, 2003. "Protecting Their Intellectual Assets: Appropriability Conditions and Why U.S. Manufacturing Firms Patent (Or Not)," Levine's Working Paper Archive 618897000000000624, David K. Levine.
    7. John C. Haltiwanger & Ron S. Jarmin & Javier Miranda, 2010. "Who Creates Jobs? Small vs. Large vs. Young," NBER Working Papers 16300, National Bureau of Economic Research, Inc.
    8. Cockburn, Iain M. & MacGarvie, Megan J. & Müller, Elisabeth, 2009. "Patent thickets, licensing and innovative performance," ZEW Discussion Papers 08-101 [rev.], ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    9. Harhoff, Dietmar & Reitzig, Markus, 2002. "Determinants of Opposition Against EPO Patent Grants - The Case of Biotechnology and Pharmaceuticals," CEPR Discussion Papers 3645, C.E.P.R. Discussion Papers.
    10. Graevenitz, Georg von & Wagner, Stefan & Harhoff, Dietmar, 2009. "How to measure patent thickets – a novel approach," Discussion Papers in Business Administration 10962, University of Munich, Munich School of Management.
    11. Wesley M. Cohen & John P. Walsh, 2008. "Real Impediments to Academic Biomedical Research," NBER Chapters, in: Innovation Policy and the Economy, Volume 8, pages 1-30 National Bureau of Economic Research, Inc.
    12. Richard Disney & Jonathan Haskel & Ylva Heden, 2003. "Entry, Exit and Establishment Survival in UK Manufacturing," Journal of Industrial Economics, Wiley Blackwell, vol. 51(1), pages 91-112, 03.
    13. Graevenitz, Georg von & Wagner, Stefan & Harhoff, Dietmar, 2011. "Incidence and Growth of Patent Thickets - The Impact of Technological Opportunities and Complexity," Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems 356, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich.
    14. James Bessen & Robert M Hunt, 2004. "An Empirical Look at Software Patents," Levine's Working Paper Archive 122247000000000167, David K. Levine.
    15. Bronwyn H. Hall & Dietmar Harhoff, 2012. "Recent Research on the Economics of Patents," NBER Working Papers 17773, National Bureau of Economic Research, Inc.
    16. David Neumark & Brandon Wall & Junfu Zhang, 2011. "Do Small Businesses Create More Jobs? New Evidence for the United States from the National Establishment Time Series," The Review of Economics and Statistics, MIT Press, vol. 93(1), pages 16-29, August.
    17. Schmalensee, Richard, 2004. "Sunk Costs and Antitrust Barriers to Entry," Working papers 4457-04, Massachusetts Institute of Technology (MIT), Sloan School of Management.
    18. Unknown, 2012. "A Roadmap to the Smartphone Patent Wars and FRAND Licensing," Antitrust Chronicle, Competition Policy International, vol. 4.
    19. Layne-Farrar, Anne & Lerner, Josh, 2011. "To join or not to join: Examining patent pool participation and rent sharing rules," International Journal of Industrial Organization, Elsevier, vol. 29(2), pages 294-303, March.
    20. Arora, Ashish & Ceccagnoli, Marco & Cohen, Wesley M., 2008. "R&D and the patent premium," International Journal of Industrial Organization, Elsevier, vol. 26(5), pages 1153-1179, September.
    21. Harhoff, Dietmar & von Graevenitz, Georg & Wagner, Stefan, 2013. "Conflict Resolution, Public Goods and Patent Thickets," CEPR Discussion Papers 9468, C.E.P.R. Discussion Papers.
    22. Hall, Bronwyn H & Ziedonis, Rosemarie Ham, 2001. "The Patent Paradox Revisited: An Empirical Study of Patenting in the U.S. Semiconductor Industry, 1979-1995," RAND Journal of Economics, The RAND Corporation, vol. 32(1), pages 101-28, Spring.
    23. Mark A. Lemley & Carl Shapiro, 2005. "Probabilistic Patents," Journal of Economic Perspectives, American Economic Association, vol. 19(2), pages 75-98, Spring.
    24. Paul B. Ellickson, 2007. "Does Sutton apply to supermarkets?," RAND Journal of Economics, RAND Corporation, vol. 38(1), pages 43-59, 03.
    25. Bronwyn H. Hall & Megan MacGarvie, 2006. "The Private Value of Software Patents," NBER Working Papers 12195, National Bureau of Economic Research, Inc.
    26. Reitzig, Markus & Henkel, Joachim & Heath, Christopher, 2007. "On sharks, trolls, and their patent prey--Unrealistic damage awards and firms' strategies of "being infringed"," Research Policy, Elsevier, vol. 36(1), pages 134-154, February.
    27. Ryan Lampe & Petra Moser, 2012. "Do Patent Pools Encourage Innovation? Evidence from 20 Industries in the 1930s," NBER Chapters, in: Standards, Patents and Innovations National Bureau of Economic Research, Inc.
    28. Alvin K. Klevorick & Richard C. Levin & Richard R. Nelson & Sidney G. Winter, 1993. "On the Sources and Significance of Interindustry Differences in Technological Opportunities," Cowles Foundation Discussion Papers 1052, Cowles Foundation for Research in Economics, Yale University.
    29. Catherine Tucker, 2012. "Patent Trolls and Technology Diffusion," NBER Chapters, in: Standards, Patents and Innovations National Bureau of Economic Research, Inc.
    30. Sutton, John, 2007. "Market Structure: Theory and Evidence," Handbook of Industrial Organization, Elsevier.
    31. Lampe, Ryan & Moser, Petra, 2010. "Do Patent Pools Encourage Innovation? Evidence from the Nineteenth-Century Sewing Machine Industry," The Journal of Economic History, Cambridge University Press, vol. 70(04), pages 898-920, December.
    32. Christian Helmers & Mark Rogers, 2010. "Innovation and the Survival of New Firms in the UK," Review of Industrial Organization, Springer, vol. 36(3), pages 227-248, May.
    33. Vickers, John, 1995. "Concepts of Competition," Oxford Economic Papers, Oxford University Press, vol. 47(1), pages 1-23, January.
    34. James Bessen & Jennifer L. Ford & Michael J. Meurer, 2011. "The Private and Social Costs of Patent Trolls," Working Papers 1103, Research on Innovation.
    35. Sternitzke, Christian & Bartkowski, Adam & Schramm, Reinhard, 2008. "Visualizing patent statistics by means of social network analysis tools," World Patent Information, Elsevier, vol. 30(2), pages 115-131, June.
    36. Adam B. Jaffe, 1999. "The U.S. Patent System in Transition: Policy Innovation and the Innovation Process," NBER Working Papers 7280, National Bureau of Economic Research, Inc.
    37. Pénin, Julien & Wack, Jean-Pierre, 2008. "Research tool patents and free-libre biotechnology: A suggested unified framework," Research Policy, Elsevier, vol. 37(10), pages 1909-1921, December.
    38. Deepak Hegde & David C. Mowery & Stuart J. H. Graham, 2009. "Pioneering Inventors or Thicket Builders: Which U.S. Firms Use Continuations in Patenting?," Management Science, INFORMS, vol. 55(7), pages 1214-1226, July.
    39. Joseph Farrell & Carl Shapiro, 2008. "How Strong Are Weak Patents?," American Economic Review, American Economic Association, vol. 98(4), pages 1347-69, September.
    40. Preston R. Fee & Hugo M. Mialon & Michael A. Williams, 2004. "What Is a Barrier to Entry?," American Economic Review, American Economic Association, vol. 94(2), pages 461-465, May.
    41. Helmers, Christian & Rogers, Mark, 2011. "Does patenting help high-tech start-ups?," Research Policy, Elsevier, vol. 40(7), pages 1016-1027, September.
    Full references (including those not matched with items on IDEAS)

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:nsr:niesrd:11129. 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: (Library & Information Manager)

    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.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.