Patent Pools, Competition, and Innovation - Evidence from 20 U.S. Industries under the New Deal
California State University, East Bay - Department of Economics
New York University (NYU), Leonard N. Stern School of Business, Students; National Bureau of Economic Research (NBER)
May 26, 2014
Stanford Law and Economics Olin Working Paper No. 417
Patent pools have become a prominent mechanism to reduce litigation risks and facilitate the commercialization of new technologies. This paper takes advantage of a window of regulatory tolerance under the New Deal to investigate the effects of pools that would form in the absence of effective antitrust. Difference-in-differences regressions of patents and patent citations across 20 industries imply a 14 percent decline in patenting for each additional patent that is included in a pool. An analysis of the mechanism by which pools discourage innovation indicates that this decline is driven by technologies for which the creation of a pool weakened competition.
Number of Pages in PDF File: 67
Keywords: Patent Pools, Innovation, Patents, Intellectual Property, Economic History
JEL Classification: K00, N00, N42, O31
Date posted: December 2, 2011 ; Last revised: May 28, 2014
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