Seminar  |  09/23/2020, 05:00 PM

Innovation & Entrepreneurship Seminar: The Dark Side of Patents – Effects of Strategic Patenting on Firms and Their Peers

Maria Kurakina (University of Utah)

Seminars currently take place in online format (see seminar page).

This paper analyses the effect of strategic patenting on firm and competitor performance, productivity, innovative output and market concentration. Using a novel definition of strategic patenting, this paper finds a positive effect of strategic patenting on market concentration. The results for the patentee show a positive effect of profit growth, and positive but significantly smaller contribution of strategic patenting to total factor productivity compared to novel technological patents. In contrast, peers suffer from a decrease in total factor productivity, innovative output and both profit and sales growth following strategic patenting by the focal firm. These findings suggest a conflict between patent policies designed to promote innovation while still providing incentives for the firms to capture market share and defend monopolistic positions.

Contact Person: David Heller