Global Patent Chokepoints
33 Pages Posted: 29 Oct 2016
Date Written: August 26, 2016
A firm’s patent strategy is commonly focused on excluding competition in the domestic market. Foreign patent rights may be sought, but the presumption is that they are valuable only if a firm has access to a foreign market through sales, licensing or foreign direct investment. However, in countries that are major manufacturing bases and international exporters, like China and India, a new strategy may be emerging: seeking patents there solely to impact competition in external markets. This paper describes this novel use of “global patent chokepoints” and presents empirical evidence that it is actually occurring. It considers patent filings in solar photovoltaics (PV) in China between 2002 and 2007 and demonstrates that activity is responsive to increases in solar PV production by Chinese rivals, but not to domestic installation. The findings are significant, because if this strategy is more widely adopted, pricing and access impacts for important health and sustainability technologies may result.
Keywords: Patent, intellectual property, china, solar panels
JEL Classification: O30, O31, O35, O38
Suggested Citation: Suggested Citation