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Comanor and Scherer Revisited: Do Patents Proxy for New Product Introductions?

14 Pages Posted: 25 Oct 2007  

Stuart J.H. Graham

Georgia Institute of Technology - Scheller College of Business

Matthew John Higgins

Georgia Institute of Technology & NBER; National Bureau of Economic Research (NBER)

Date Written: September 24, 2007

Abstract

In this paper, we examine the propriety of using patents as a proxy for firm innovative performance. We find that in the pharmaceutical industry during 1985-2001 they are not. Replicating the methodology in a study by Comanor and Scherer (1969) upon which many current studies base their use of patents as proxy, we demonstrate simple correlations of 0.1911 between lagged-patent filings and actual new product introductions, and partial correlations of 0.1785 when holding firm size constant. Our results raise serious questions about the usefulness of employing patent measures in contemporary studies that examine the innovative performance of firms.

Keywords: Patenting; Pharmaceutical industry; Research productivity

JEL Classification: O30

Suggested Citation

Graham, Stuart J.H. and Higgins, Matthew John, Comanor and Scherer Revisited: Do Patents Proxy for New Product Introductions? (September 24, 2007). Available at SSRN: https://ssrn.com/abstract=1024572 or http://dx.doi.org/10.2139/ssrn.1024572

Stuart J.H. Graham

Georgia Institute of Technology - Scheller College of Business ( email )

800 West Peachtree St. NW
Atlanta, GA 30308
United States
404-385-0953 (Phone)
404-894-6030 (Fax)

HOME PAGE: http://https://www.scheller.gatech.edu/graham

Matthew John Higgins (Contact Author)

Georgia Institute of Technology & NBER ( email )

800 West Peachtree Street
Atlanta, GA 30308
United States
404-894-4368 (Phone)
404-894-6030 (Fax)

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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