Trading and enforcing patent rights

Alberto Galasso, Mark Schankerman and Carlos Serrano

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: We study how the market for innovation affects enforcement of patent rights. We show that patent transactions arising from comparative advantages in commercialization increase litigation, but trades driven by advantages in patent enforcement reduce it. Using data on trade and litigation of individually owned patents in the United States, we exploit variation in capital gains tax rates across states as an instrument to identify the causal effect of trade on litigation. We find that taxes strongly affect patent transactions, and that trade reduces litigation on average, but the impact is heterogeneous. Patents with larger potential gains from trade are more likely to change ownership, and the impact depends critically on transaction characteristics.

JEL-codes: E6 L81 (search for similar items in EconPapers)
Date: 2013-06
New Economics Papers: this item is included in nep-ino, nep-int, nep-ipr, nep-pr~, nep-law and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (66)

Published in RAND Journal of Economics, June, 2013, 44(2), pp. 275-312. ISSN: 0741-6261

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http://eprints.lse.ac.uk/51080/ Open access version. (application/pdf)

Related works:
Journal Article: Trading and enforcing patent rights (2013)
Working Paper: Trading and Enforcing Patent Rights (2011)
Working Paper: Trading and Enforcing Patent Rights (2011)
Working Paper: Trading and Enforcing Patent Rights (2011)
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