Patent rights, product market reforms, and innovation
By Philippe Aghion, Peter Howitt, Susanne Prantl. Journal of economic growth (Boston), 2015
157 citations recorded by the source corpus.
In this paper, we provide empirical evidence to the effect that strong patent rights may complement competition-increasing product market reforms in fostering innovation. First, we find that the product market reform induced by the large-scale internal market reform of the European Union in 1992 enhanced, on average, innovative investments in manufacturing industries of countries with strong patent rights since the pre-sample period, but not so in industries of countries with weaker patent rights. Second, the positive response to the product market reform is more pronounced in industries where, in general, innovators tend to value patent protection higher than in other industries, except for the manufacture of electrical and optical equipment. The observed complementarity between competition and patent protection can be rationalized using a Schumpeterian growth model with step-by-step innovation. In such a model, better patent protection prolongs the period over which a firm that successfully escapes competition by innovating, actually enjoys higher monopoly rents from its technological upgrade.
Subfields: Economics and Econometrics, Management of Technology and Innovation
View Paper: https://www.semanticscholar.org/paper/80dc3d235b57df6ad60f9a4ebd8157a46e513917
Citations in the corpus
- What Do We Learn from Schumpeterian Growth Theory (2013, unknown): “Using this fact, together with (21) , (22) and (23) , delivers the equilibrium entry rate and incumbent innovation intensity:”
- How Do Foreign Institutional Investors Enhance Firm Innovation? (2017, unknown): “Specifically, we follow Aghion, Howitt, and Prantl (2015) to control for the patent regulatory environment by using the patent right protection index of Park (2008) (PINDEX).”
- NBER WORKING PAPER SERIES ARTIFICIAL INTELLIGENCE AND ECONOMIC GROWTH (2017, unknown): “To rationalize the above findings and these latter predictions, let us follow Aghion, Bergeaud, Blundell and Griffith (2017) who propose a model in which more innovative firms display a higher degree of complementarity between low-skill workers and the other production factors (capital and high-skil”