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Monetary and implicit incentives of patent examiners

Corinne Langinier () and Philippe Marcoul ()

Journal of Economics and Business, 2020, vol. 110, issue C

Abstract: Often accused of granting questionable patents, examiners might lack proper incentives to carefully scrutinize patent applications. We analyze their examination and granting behavior in the presence of different incentive schemes that reward examiners based on rejected and/or accepted patents. Our findings suggest that, for a given probability of random audit by the PTO, a dual regime (based on both accepted and rejected patents) does not provide more incentive than a salary based on rejected patents. An optimal probability of random audit chosen by the PTO is often too high compared to the first best, while the examiner chooses a suboptimal examination effort's level. Lastly, we study the effect of career concerns on the granting behavior of examiners. We find that monetary and implicit incentives induce patent examiners to intensify their search effort. Furthermore, a marginal increase of the random audit might reduce examiners’ effort in the presence of career concerns.

Keywords: Patent examiners; Career concerns (search for similar items in EconPapers)
JEL-codes: J60 M5 O34 (search for similar items in EconPapers)
Date: 2020
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Working Paper: Monetary and Implicit Incentives of Patent Examiners (2009) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jebusi:v:110:y:2020:i:c:s0148619519303078

DOI: 10.1016/j.jeconbus.2020.105906

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