InnoVAE: Generative AI for Mapping Patents and Firm Innovation

36 Pages Posted: 13 Apr 2022 Last revised: 11 Oct 2023

See all articles by Zhaoqi Cheng

Zhaoqi Cheng

Boston University - Questrom School of Business

Dokyun Lee

Boston University - Questrom School of Business

Prasanna Tambe

Wharton School, U. Pennsylvania

Date Written: March 1, 2022

Abstract

We propose a generative AI approach (InnoVAE) to map unstructured patent text into an interpretable, spatial representation of firms' innovative activities. InnoVAE learns a vector representation of patents and places them within a "disentangled" space to facilitate managerial intuition and action. After validating the internal consistency of our approach, we apply it to three decades of AI patents to show that it can be used to construct interpretable measures, at scale, that characterize firms' AI-based IP portfolios. We demonstrate three use cases including (1) generating technology landscapes that inform businesses about their competitive positions, (2) engineering new, intuitive features from unstructured text that facilitate analysis of patent activity, and (3) augmenting patent applications to mitigate the risk of patent rejection. Our approach demonstrates the potential of generative AI methods to make actionable the vast quantities of text stored in unstructured corporate databases.

Keywords: generative AI, patents, machine learning, interpretability, economics of innovation, managerial decision support, ChatGPT, large language models

Suggested Citation

Cheng, Zhaoqi and Lee, Dokyun and Tambe, Prasanna, InnoVAE: Generative AI for Mapping Patents and Firm Innovation (March 1, 2022). Available at SSRN: https://ssrn.com/abstract=3868599 or http://dx.doi.org/10.2139/ssrn.3868599

Zhaoqi Cheng

Boston University - Questrom School of Business ( email )

595 Commonwealth Avenue
Boston, MA MA 02215
United States

Dokyun Lee (Contact Author)

Boston University - Questrom School of Business ( email )

595 Commonwealth Avenue
Boston, MA MA 02215
United States

Prasanna Tambe

Wharton School, U. Pennsylvania ( email )

Philadelphia, PA 19104
United States

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