|Title:||Patent Protection and Innovation Over 150 Years|
|Citation:||Lerner, J. (2002). Patent protection and innovation over 150 years (No. w8977). National Bureau of Economic Research.|
|Link(s):||Definitive , Open Access|
|Key Related Studies:|
|About the Data|
|Data Description:||In total, I ended up with 177 events in 51 out of the 60 nations in the sample. The first change in the sample occurred in 1852 and the last in 1998. In many cases, the policy shift affected several elements of the patent system, or two closely related bills were passed in the same year. Consequentially, the number of distinct policy changes was larger, a total of 271.|
|Data Type:||Secondary data|
|Secondary Data Sources:|
|Data Collection Methods:|
|Data Analysis Methods:|
|Cross Country Study?:||Yes|
|Government or policy study?:||No|
|Time Period(s) of Collection:||
The paper seeks to understand the impact of the patent system on innovation by examining shifts in the strength of patent protection across sixty countries and a 150-year period. An examination of 177 policy changes reveals that strengthening patent protection appears to have few positive effects on patent applications by entities in the country undertaking the policy change, whether filings in Great Britain or the nation making the policy change are considered. Cross-sectional analyses suggest that the impact of patent protection-enhancing shifts were greater in nations with weaker initial protection and greater economic development, consistent with economic theory. I address concerns about the endogeneity of these changes by employing an instrumental variable approach.
Main Results of the Study
Adjusting for the change in overall patenting, the impact of patent protection-enhancing shifts on applications by residents was actually negative, whether filings in Great Britain or domestically were considered.
The cross-sectional differences in the impact of these shifts were largely consistent with the predictions of economic theorists. These findings are consistent with earlier case studies of individual policy changes.
Policy Implications as Stated By Author
The extensive theoretical literature on patenting suggests at least three predictions about when strengthening patent policy should particularly boost innovation. To explore these suggestions, I examine cross-sectional differences across these events. Consistent with theoretical suggestions, I find that patent protection-enhancing shifts have a lesser impact on innovation when the nation already has strong patent protection and when its per capita gross domestic product lags further behind other nations. These patterns continue to hold when I employ an instrumental variables approach, which partially addresses the concern that the timing of these policy changes is not exogenous.
Coverage of Study
|Level of aggregation:||Country|
|Period of material under study:||1852-1998|