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The Consequences of Invention Secrecy: Evidence from the USPTO Patent Secrecy Program in World War II

Daniel P. Gross

NBER Working Paper No. 25545
Issued in February 2019, Revised in March 2019
NBER Program(s):Development of the American Economy, Law and Economics, Productivity, Innovation, and Entrepreneurship

This paper studies the effects of the USPTO's patent secrecy program in WorldWar II, under which approximately 11,200 U.S. patent applications were issued secrecy orders which halted examination and prohibited inventors from disclosing their inventions or filing in foreign countries. Secrecy orders were issued most heavily in areas important to the war effort — such as radar, electronics, and synthetic materials — and nearly all rescinded at the end of the war. I find that compulsory invention secrecy was effective at keeping affected technology out of the public domain, but it appears to have reduced and delayed follow-on invention, restricted commercialization, and temporarily hampered post-war entry into patenting. The results shed light on the consequences of invention secrecy, which is widely used by inventors to protect and appropriate the returns to innovation, and yield lessons for ongoing policy debates over potential measures to protect U.S. invention against the growing incidence of foreign IP theft today.

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Document Object Identifier (DOI): 10.3386/w25545

 
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