Prizes, Publicity, and Patents: Non-Monetary Awards as a Mechanism to Encourage Innovation

38 Pages Posted: 15 Jan 2013 Last revised: 21 Sep 2013

See all articles by Petra Moser

Petra Moser

NYU Stern Department of Economics; National Bureau of Economic Research (NBER)

Tom Nicholas

Harvard University - Entrepreneurial Management Unit

Multiple version iconThere are 2 versions of this paper

Date Written: September 20, 2013

Abstract

Prizes have become a prominent alternative to patents as a mechanism to encourage innovation. This paper exploits the selection of prize-winning technologies among exhibitors at the 1851 Crystal Palace Exhibition in London in 1851 to examine whether – and how – prizes may encourage innovation, even without a cash award. Baseline tests compare changes in patents per year after 1851 for technologies that won a prize with changes in patents per year for technologies that were chosen to exhibit, but did not win a prize. U.S. patent data indicate a 40 percent increase in patenting for prize-winning technologies after 1851. These results are robust to controlling for technology-specific pre-trends and to controlling for patent-quality through citation-weighted patents. The second part of the analysis examines publicity as a potential mechanism by which prizes may encourage innovation, even in the absence of a cash award. It compares changes in patents per year after 1851 for technologies that were described in a lead article in the Scientific American, a widely-read science journal, with changes in patents for related technologies and, alternatively, for all other technologies. Results indicate a comparable increase in invention, suggesting that providing publicity for promising areas of research may be an important mechanism by which prizes encourage innovation.

Keywords: O31, O30, N40

JEL Classification: prizes, patent law, innovation, science

Suggested Citation

Moser, Petra and Nicholas, Tom, Prizes, Publicity, and Patents: Non-Monetary Awards as a Mechanism to Encourage Innovation (September 20, 2013). Available at SSRN: https://ssrn.com/abstract=1910220 or http://dx.doi.org/10.2139/ssrn.1910220

Petra Moser (Contact Author)

NYU Stern Department of Economics ( email )

44 West 4th Street
New York, NY 10003
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Tom Nicholas

Harvard University - Entrepreneurial Management Unit ( email )

Cambridge, MA 02163
United States

Register to save articles to
your library

Register

Paper statistics

Downloads
155
rank
182,083
Abstract Views
1,175
PlumX Metrics