Innovation

Paper Session

Saturday, Jan. 7, 2017 2:30 PM – 4:30 PM

Hyatt Regency Chicago, New Orleans
Hosted By: American Economic Association
  • Chair: Arthur Diamond, University of Nebraska-Omaha

Do Immigrants Return Knowledge Home? The Evidence on Knowledge Dissemination via Wikipedia

Olga Slivko
,
Centre for European Economic Research

Abstract

While previous studies highlight the positive impact of immigration on cross-border patenting and scientific publications, the role of immigration flows in the dissemination of knowledge in a wider context is not fully assessed. In this paper, I estimate the effect of immigration on the facilitation of online knowledge in relevant domains. To quantify online knowledge, I focus on one of the world's most viewed knowledge platforms, Wikipedia.
I combine the data on (skilled) immigration flows between the pairs of countries of immigrants' origin and destination with contributions to Wikipedia about destination countries in the native languages of origin countries. The knowledge domains I look at are related to science, technology and culture. In order to draw a causal inference, I use spikes in immigration above 30% in the origin countries as exogenous shocks with respect to Wikipedia content and analyze subsequent changes in the rates of contribution to Wikipedia in a difference-in-differences framework. The results suggest that an increase in immigration yields more knowledge contributed to Wikipedia about destination countries on the native languages of the origin countries. The increase in contributions stems mostly from anonymous (potentially, new or occasional) contributors. Moreover, once spikes in skilled immigration are considered, the effects on science and technology domains get stronger.

Shielded Innovation

Lauren Cohen
,
Harvard Business School
Umit Gurun
,
University of Texas-Dallas
Scott Duke Kominers
,
Harvard University

Abstract

In this paper, we show that increased litigation risk has driven innovators to shield themselves by shifting innovation out of industry and into universities. We show both theoretically and empirically that litigation by Non-Practicing Entities (NPEs)/Patent Assertion Entities (PAEs) pushes innovation to spaces with where innovation can be conducted at reduced litigation threat of litigation. Using the entire universe of U.S. patents granted over the past four decades, we demonstrate a growing shift shift of innovation into universities. We moreover show that it innovation has shifted into universities (and away from public and private firms) in is precisely exactly those industries that with the PAEs most aggressive NPE ly litigatione that have shifted toward universities and away from public and private firms; furthermore,. tThe shifts we document occur precisely following following periods of prolonged periods of PAE NPE litigation activity. The extent of innovation shielding is large and significant. An average increase in of 100 NPE litigation actions cases brought by PAEs in an industry preceding years shifts up the university share of innovation in the targeted industry by roughly 70% in subsequent years (t=5.34).

Ex-Ante Information Provision and Patenting: Natural Experiment of Herbal Patent Prior Art Adoption at the USPTO and EPO

Raj Choudhury
,
Harvard University
Tarun Khanna
,
Harvard University

Abstract

We study how ex-ante information provision, in the form of codified prior art, affects patenting. Using a unique dataset of herbal patents filed on the United States Patent Office (USPTO) and European Patent Office (EPO) from 1977 to 2013, we exploit a natural experiment where the EPO adopted as prior art, a codified database of traditional herbal medicine, three and a half years ahead of the USPTO. This database (the ‘Traditional Knowledge Depository Library’ or TKDL) was created by Indian state-owned R&D labs and provided the USPTO and EPO patent examiners with codified, searchable prior art on herbal formulations based on a translation of ancient Indian medicinal texts. We establish that the time lag of the USPTO adopting TKDL compared to the EPO was related to exogenous and bureaucratic delays at the USPTO. We find that the adoption of TKDL affects the level of herbal patent filing and grants. It also shifts the composition of patenting away from pure herbal formulations that are similar to prior art available in the ancient texts towards applications involving both herbs and synthetic compounds, which are more distant from the prior art and arguably less contestable. We also use unique data coded from patent image wrappers at the USPTO and validate the ‘smoking gun’ that prior art codification affects the search strategies of patent examiners.

Does Knowledge Protection Benefit Shareholders? Evidence From Stock Market Reaction and Firm Investment in Knowledge Assets

Teng Wang
,
Federal Reserve Board
Buhui Qiu
,
University of Sydney

Abstract

This paper studies whether knowledge protection affects shareholder value and firms’ investment in knowledge assets using the staggered adoptions and rejections of the inevitable disclosure doctrine (IDD) by U.S. state courts as exogenous changes in the level of knowledge protection. We find positive (negative) abnormal stock returns around the IDD adoption (rejection) day for firms headquartered in the state and uncover a positive IDD treatment effect on firms’ investment in knowledge assets. Moreover, the effects on stock returns and knowledge-assets investment are stronger in more knowledge-oriented states, industries, and firms. Finally, enhancing knowledge protection does not discourage local entrepreneurial activity.

Technology Polarization

Koki Oikawa
,
Waseda University
Minoru Kitahara
,
Osaka City University

Abstract

We construct a new method to describe firm distributions within technology fields and the dynamic behavior of these distributions. To locate firms on a technology space, we apply multidimensional scaling for the inter-firm technological dissimilarity matrices that are computed from patent citation overlaps among firms using the NBER US patent dataset. Our estimated firm distributions show increasing trends in technological distance and polarization on average, where we follow Duclos et al. (2004) to measure polarization. We construct a model of inter-group competition in which polarization stimulates R&D incentives. The model fits data before the major patent reform in the United States in 1980s and polarization increases citation-weighted number of patent applications. After about 1990, the impact of polarization is reversed.
JEL Classifications
  • K3 - Other Substantive Areas of Law
  • O3 - Innovation; Research and Development; Technological Change; Intellectual Property Rights