Inventors and Impostors: An Analysis of Patent Examination With Self-Selection of Firms into R&D

31 Pages Posted: 17 Jul 2012

See all articles by Florian Schuett

Florian Schuett

KU Leuven - Department of Economics; Tilburg Law and Economics Center (TILEC); Tilburg University - Tilburg University School of Economics and Management

Date Written: June 2012

Abstract

I present a model in which firms differing in R&D productivity choose between ambitious research projects, which are socially desirable, and unambitious ones, which are socially undesirable. The patent office must decide how rigorously to examine applications, which affects the probability of weeding out bad applications but also how firms self-select into more or less ambitious projects. Both the ex post and ex ante welfare effects need to be taken into account in determining the optimal examination intensity. The model allows me to assess the impact of various policy changes on examination and welfare, including the creation of specialized patent courts, post-grant opposition, and the delegation of fee-setting authority to the patent office. It generates a number of predictions that are consistent with empirical evidence on the patent system.

Keywords: innovation, patent office, optimal patent policy

JEL Classification: O31, O38, D73, D82, L50

Suggested Citation

Schuett, Florian, Inventors and Impostors: An Analysis of Patent Examination With Self-Selection of Firms into R&D (June 2012). TILEC Discussion Paper No. 2012-026, Available at SSRN: https://ssrn.com/abstract=2109406 or http://dx.doi.org/10.2139/ssrn.2109406

Florian Schuett (Contact Author)

KU Leuven - Department of Economics ( email )

Leuven
Belgium

Tilburg Law and Economics Center (TILEC) ( email )

Warandelaan 2
Tilburg, 5000 LE
Netherlands

Tilburg University - Tilburg University School of Economics and Management ( email )

P.O. Box 90153
Tilburg, 5000 LE
Netherlands

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