Patent Quality and a Two-Tiered Patent System

Forthcoming in Journal of Industrial Economics

28 Pages Posted: 14 Apr 2011 Last revised: 3 Jan 2015

See all articles by Vidya Atal

Vidya Atal

Montclair State University - Feliciano School of Business

Talia Bar

University of Connecticut - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: July 16, 2013

Abstract

In this paper, we study the determinants of patent quality and volume of patent applications when inventors care about perceived patent quality. We analyze the effects of various policy reforms, specifically, a proposal to establish a two-tiered patent system. In the two-tiered system, applicants can choose between a regular patent and a more costly, possibly more thoroughly examined, "gold-plate" patent. Introducing a second patent-tier can reduce patent applications, reduce the incidence of bad patents, and sometimes increase social welfare. The gold-plate tier attracts inventors with high ex-ante probability of validity, but not necessarily applicants with innovations of high economic value.

Keywords: patent, patent quality, gold-plate patent, two-tiered patent system, innovation, research and development, prior art

JEL Classification: D83, O31, O34

Suggested Citation

Atal, Vidya and Bar, Talia R., Patent Quality and a Two-Tiered Patent System (July 16, 2013). Forthcoming in Journal of Industrial Economics, Available at SSRN: https://ssrn.com/abstract=1807061 or http://dx.doi.org/10.2139/ssrn.1807061

Vidya Atal (Contact Author)

Montclair State University - Feliciano School of Business ( email )

Department of Economics
1 Normal Avenue
Montclair, NJ 07043
United States
(973)655-7403 (Phone)

HOME PAGE: http://https://sites.google.com/site/vidyaatal/home

Talia R. Bar

University of Connecticut - Department of Economics ( email )

365 Fairfield Way, U-1063
Storrs, CT 06269-1063
United States

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