On the Price Elasticity of Demand for Patents
Oxford Bulletin of Economics and Statistics, Vol. 74, No. 1, p. 58-77
23 Pages Posted: 18 Dec 2010 Last revised: 7 Jan 2012
Date Written: September 1, 2010
This paper provides an analysis of the impact of patent fees on the demand for patents. It presents a dataset of fees since 1980 at the European (EPO), the U.S. and the Japanese patent offices. Descriptive statistics show that fees have severely decreased at the EPO over the nineties, converging towards the level of fees in the U.S. and Japan. The estimation of dynamic panel data models suggests that the price elasticity of demand for patents is about -0.30. These results suggest that the laxity of fee policy at the EPO has significantly contributed to the rising propensity to patent.
Keywords: patent cost, patent fees, price elasticity, patent explosion, propensity to patent
JEL Classification: O30, O31, O38, O57
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