Patent Thickets, Licensing and Innovative Performance

Posted: 4 Jun 2010

See all articles by Iain M. Cockburn

Iain M. Cockburn

Boston University Questrom School of Business; National Bureau of Economic Research (NBER)

Megan MacGarvie

Boston University School of Management; National Bureau of Economic Research (NBER)

Elisabeth Mueller

German Graduate School of Management and Law

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Date Written: June 2010

Abstract

We examine the relationship between fragmented intellectual property (IP) rights and the innovative performance of firms, taking into consideration the role played by in-licensing of IP. We find that firms facing more fragmented IP landscapes have a higher probability of in-licensing. We observe a negative relationship between IP fragmentation and innovative performance, but only for firms that engage in in-licensing. In contrast, greater IP fragmentation is associated with higher innovative performance for firms that do not in-license. Furthermore, the effects of fragmentation on innovation also appear to depend on the size of a firm’s patent portfolio. These results suggest that the effects of fragmentation of upstream IP rights are not uniform, and instead vary according to the characteristics of the downstream firm.

Suggested Citation

Cockburn, Iain M. and MacGarvie, Megan and Mueller, Elisabeth, Patent Thickets, Licensing and Innovative Performance (June 2010). Industrial and Corporate Change, Vol. 19, Issue 3, pp. 899-925, 2010. Available at SSRN: https://ssrn.com/abstract=1617056 or http://dx.doi.org/dtq035

Iain M. Cockburn (Contact Author)

Boston University Questrom School of Business ( email )

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National Bureau of Economic Research (NBER) ( email )

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Megan MacGarvie

Boston University School of Management ( email )

595 Commonwealth Avenue
Boston, MA 02215
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Elisabeth Mueller

German Graduate School of Management and Law ( email )

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