Cohen, Nelson and Walsh (2000)
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Source Details
Cohen, Nelson and Walsh (2000) | |
Title: | Protecting their intellectual assets: Appropriability conditions and why U.S. manufacturing firms patent(or not) |
Author(s): | Cohen, W. M., Nelson, R. R., Walsh, J. P. |
Year: | 2000 |
Citation: | Cohen, W. M., Nelson, R. R., & Walsh, J.P. (2000). Protecting their intellectual assets: Appropriability conditions and why U.S. manufacturing firms patent(or not). National Bureau of Economic Research, Working Paper No.7552. |
Link(s): | Definitive , Open Access |
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About the Data | |
Data Description: | Survey questionnaire administered to 1478 R&D managers in the U.S. in 1994. The survey data is supplemented with published data on firm sales and employees from COMPUSTAT, Dun and Bradstreet, Moody's, and Ward's. The surveys were also supplemented with 18 interviews with R&D managers. The interviews typically lasted one hour, and often included more than one respondent. |
Data Type: | Primary data |
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Cross Country Study?: | No |
Comparative Study?: | Yes |
Literature review?: | No |
Government or policy study?: | No |
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Abstract
Based on a survey questionnaire administered to 1478 R&D labs in the U.S. manufacturing sector in 1994, we find that firms typically protect the profits due to invention with a range of mechanisms, including patents, secrecy, lead time advantages and the use of complementary marketing and manufacturing capabilities. Of these mechanisms, however, patents tend to be the least emphasized by firms in the majority of manufacturing industries, and secrecy and lead time tend to be emphasized most heavily. A comparison of our results with the earlier survey findings of Levin et al. (1987) suggests that patents may be relied upon somewhat more heavily by larger firms now than in the early 1980s. For the protection of product innovations, secrecy now appears to be be much more heavily employed across most industries than previously. Our results on the motives for patent indicate that firms patent for reasons that often extend beyond directly profiting from a patented innovation through either its commercialization or licensing. In addition to the prevention of copying, the most prominent motives for patenting include the prevention of rivals from patenting related inventions (i.e., "patent blocking"), the use of patents in negotiations and the prevention of suits. We find that firms commonly patent for different reasons in "discrete" product industries, such as telecommunications equipment or semiconductors. In the former, firms appear to use their patents commonly to block the development of substitute by rivals, and in the latter, firms are much more likely to use patents to force rivals into negotiations.
Main Results of the Study
- Firms tend to protect the profits due to invention with a range of mechanisms, including patents, secrecy, lead time advantages and the use of complementary marketing and manufacturing capabilities.* Of these mechanisms, patents are typically the least emphasized by firms in the majority of manufacturing industries, while secrecy and lead time tend to be emphasized most heavily.* A comparison of this study's results with the earlier survey findings of Levin et al. (1987) suggests that patents may be relied upon somewhat more heavily by larger firms now than in the early 1980s.* The main prominent motives for patenting, in addition to the prevention of copying, include the prevention of rivals from patenting related inventions, the use of patents in negotiations and the prevention of suits.
Policy Implications as Stated By Author
By limiting entry, patent portfolio may help prevent breakdowns in negotiations over intellectual property.
Coverage of Study
Datasets
Sample size: | 1478 |
Level of aggregation: | Questionnaire |
Period of material under study: | 1994 |
Sample size: | 18 |
Level of aggregation: | Interview |
Period of material under study: | 1994 |