Do Firms Face a Trade-Off between the Quantity and the Quality of Their Inventions?
Intellectual Property Research Institute of Australia Working Paper No. 4/13
17 Pages Posted: 25 Feb 2013
Date Written: February 19, 2013
This paper presents evidence that firms face a trade-off between the quantity and quality of their research output. The econometric analysis uses survey data on patent applicants at the European Patent Office and addresses the identification problem caused by differences in firms’ propensity to patent. The existence of a trade-off emphasizes the need to take the quality of research output into account when assessing research productivity. It also raises questions about the optimal quantity – quality mix that firms should target.
Keywords: innovation performance, invention quality, invention quantity, patent explosion, propensity to patent, research productivity
JEL Classification: D83, L25, O31, O33
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