Do Patent Pools Encourage Innovation? Evidence from 20 U.S. Industries Under the New Deal
Type:
SCID Working Paper 524
Publisher:
Petra Moser
Publisher:
SCID
Author(s):
Published:
12/19/14
Abstract:
Patent pools, which allow competing firms to combine their patents, have emerged as a prominent mechanism to resolve litigation when multiple firms own patents for the same technology. This paper takes advantage of a window of regulatory tolerance under the New Deal to investigate the effects of pools on innovation within 20 industries. Difference-in-differences regressions imply a 16 percent
decline in patenting in response to the creation of a pool. This decline is driven by technology fields in which a pool combined patents for substitute technologies by competing firms, suggesting that unregulated pools may discourage innovation by weakening competition to improve substitutes.
By:
Petra Moser
Full Text: