Patent Intensity and Concentration: The Effect of Institutional Quality on MSA Patent Activity

36 Pages Posted: 3 May 2019

See all articles by Gary A. Wagner

Gary A. Wagner

University of Louisiana-Lafayette; University of Louisiana-Lafayette

Jamie Bologna Pavlik

Texas Tech University - Department of Agricultural and Applied Economics

Date Written: April 3, 2019

Abstract

Patented innovation is a predominately local phenomena. It is also an indicator of economic growth. Using data on U.S. metropolitan statistical areas (MSAs), we examine the long-run effect of economic freedom, and each of its three components, on local patent activity. We find that increased government spending is associated with reduced individual patent activity, though this effect is small in magnitude. Our strongest results suggest that increased economic freedom significantly reduces patent concentration in both ownership and product types. This suggests that economic freedom creates an environment conducive to diverse and diffused innovation. Our main results are robust to a quantile regression instrumental variable analysis.

Keywords: patents, innovation, institutions, economic freedom

JEL Classification: O3, O43, D63

Suggested Citation

Wagner, Gary A. and Bologna Pavlik, Jamie, Patent Intensity and Concentration: The Effect of Institutional Quality on MSA Patent Activity (April 3, 2019). Available at SSRN: https://ssrn.com/abstract=3365314 or http://dx.doi.org/10.2139/ssrn.3365314

Gary A. Wagner

University of Louisiana-Lafayette

LA
United States

University of Louisiana-Lafayette ( email )

Lafayette, LA 70504
United States

Jamie Bologna Pavlik (Contact Author)

Texas Tech University - Department of Agricultural and Applied Economics ( email )

Suite 167, 2625 Memorial Circle
TTU Administration
Lubbock, TX 79409
United States

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