The Hidden Costs of Securing Innovation: The Manifold Impacts of Compulsory Invention Secrecy

Daniel Gross

No 25545, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: One of the U.S. Patent and Trademark Office’s (USPTO) most commanding powers is to compel inventions into secrecy, withholding patent rights and prohibiting disclosure, to prevent technology from leaking to foreign competitors. This paper studies the impacts of compulsory secrecy on firm invention and the wider innovation system. In World War II, USPTO issued secrecy orders to >11,000 patent applications, which it rescinded en masse at the end of the war. Compulsory secrecy caused implicated firms to shift their patenting away from treated classes, with effects persisting through at least 1960. It also restricted commercialization and impeded follow-on innovation. Yet it appears it was effective at keeping sensitive technology out of public view. The results provide insight into the effectiveness of compulsory secrecy as a regulatory strategy and into the roles, and impacts, of formal intellectual property in the innovation system.

JEL-codes: N42 N72 O31 O32 O34 O38 (search for similar items in EconPapers)
Date: 2019-02
New Economics Papers: this item is included in nep-his, nep-ino, nep-ipr and nep-tid
Note: DAE LE PR
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

Published as Daniel P. Gross, 2023. "The Hidden Costs of Securing Innovation: The Manifold Impacts of Compulsory Invention Secrecy," Management Science, vol 69(4), pages 2318-2338.

Downloads: (external link)
http://www.nber.org/papers/w25545.pdf (application/pdf)

Related works:
Journal Article: The Hidden Costs of Securing Innovation: The Manifold Impacts of Compulsory Invention Secrecy (2023)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nbr:nberwo:25545

Ordering information: This working paper can be ordered from
http://www.nber.org/papers/w25545

Access Statistics for this paper

More papers in NBER Working Papers from National Bureau of Economic Research, Inc National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.. Contact information at EDIRC.
Bibliographic data for series maintained by ().