NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

R&D and the Patent Premium

Ashish Arora, Marco Ceccagnoli, Wesley M. Cohen

NBER Working Paper No. 9431
Issued in January 2003
NBER Program(s):   PR

We analyze the effect of patenting on R&D with a model linking a firm's R&D effort with its decision to patent, recognizing that R&D and patenting affect one another and are both driven by many of the same factors. Using survey data for the U.S. manufacturing sector, we estimate the increment to the value of an innovation realized by patenting it, and then analyze the effect on R&D of changing that premium. Although patent protection is found to provide a positive premium on average in only a few industries, our results also imply that it stimulates R&D across almost all manufacturing industries, with the magnitude of that effect varying substantially.

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Document Object Identifier (DOI): 10.3386/w9431

Published: Arora, Ashish, Marco Ceccagnoli, and Wesley M. Cohen. "R&D and the Patent Premium", International Journal of Industrial Organization, Volume 26, Issue 5, September 2008, Pages 1153-1179

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