Abstract

http://ssrn.com/abstract=1823463
 


 



Innovation Dynamics, Patents, and Dynamic-Elasticity Tests for the Promotion of Progress


John M. Golden


The University of Texas at Austin - School of Law

April 26, 2011

Harvard Journal of Law and Technology, Vol. 24, No. 1, pp. 47-110, 2010
U of Texas Law, Law and Econ Research Paper No. 204

Abstract:     
This article develops a differential-equation model for innovation dynamics that significantly resembles a Newtonian model for motion in the presence of air resistance. The model generates a diverse array of trajectories for technological progress as a function of time. Among these, trajectories featuring linear or exponential growth are only special or even exceptional. In contrast, under a broad array of circumstances, the model generates power-law behavior: i.e., yields a prediction that technological progress will grow approximately like the quantity t raised to the power z, where t is a measure of elapsed time and z is a positive exponent. The model also suggests that, under various circumstances, whether a given incremental policy change accelerates or decelerates technological progress can be substantially determined by a “dynamic-elasticity” or “double-ratio” test involving comparison of percentage changes in model parameters. The existence of such double-ratio tests might mean that patents’ effects on innovation are even more sensitive to technologic and industrial circumstance than is commonly appreciated.

Empirical study of U.S. patent numbers supplements the theoretical work described above. Numbers of issued patents are sometimes taken as a crude measure of technological progress. In light of the supralinear-power-law behavior frequently predicted by this article’s model, it might be significant that growth in the cumulative number of U.S. patents appears commonly to correspond to a supralinear power law.

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Date posted: April 26, 2011 ; Last revised: April 27, 2011

Suggested Citation

Golden, John M., Innovation Dynamics, Patents, and Dynamic-Elasticity Tests for the Promotion of Progress (April 26, 2011). Harvard Journal of Law and Technology, Vol. 24, No. 1, pp. 47-110, 2010; U of Texas Law, Law and Econ Research Paper No. 204. Available at SSRN: http://ssrn.com/abstract=1823463

Contact Information

John M. Golden (Contact Author)
The University of Texas at Austin - School of Law ( email )
School of Law
727 East Dean Keeton Street
Austin, TX 78705
United States
(512) 232-1469 (Phone)

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