Patents, Citations & Innovations: A Window on the Knowledge Economy

Originally published in 2003 in The Business Economist, volume 34, issue 1. The original publication day is unrecorded.

Adam B Jaffe and Manuel Trajtenberg, MIT Press, 2002, xiii + 478 pages, £23.59.

From The Business Economist, volume 34, issue 1 (2003).

This book draws together some of the papers written in the course of a NBER Productivity Program started in 1993. It uses data:

The data were aggregated into six categories as follows:

A CD-ROM with the data accompanies the book.

In addition to the authors above, it includes authors and co-authors as follows: Bruce A Banks, Ricardo J Cabellero, Michael S Fogarty, Bronwyn Hall, Rebecca Henderson and Josh Lerner. There is a forward by Paul Romer. Except for the introduction and final two chapters, Zvi Grilliches advised on the work. Part I includes three papers from the early 1990s to provide the conceptual approach of the project. Part II includes papers from the mid- to late-1990s which use the data to explore geographic patterns of spill-overs across regions and countries. Part III includes more recent papers using the patent data which look at particular institutions, eg universities, countries and policy issues. Part IV reports the results of a survey of patentees and a description of the data files. The reader should be aware that the papers date from different times so some of the institutional information may be out-of-date.

This is a rich source of insight and information about how to use and what can be learned from patent data. As a general rule, the conclusions are indicative rather than definitive. Patent data, which should be a fertile source of information on invention, diffusion and spill-overs, for example, have not paid off to the extent that was expected in the early 1990s.

Chapter 8, ‘Universities as a Source of Commercial Technology: A Detailed Analysis of University Patenting 1965-88’ is of perhaps most interest in the context of UK policy-making. Commercial exploitation of intellectual property (IP) is increasingly encouraged in UK universities as the third leg of funding along with teaching and research. In 1980, the US Congress passed the Bayh-Dole Act that permitted universities to charge royalties from patents stemming from federally-funded research. “At the same time increasing competition for federal resources has forced many universities to turn to alternative sources of funding.” (p 238) From the analysis of the data, it seems that these changes probably increased the transfer of IP to the private sector. However, it does not seem to have had a significant impact on the underlying rate of generation of commercially-important inventions at universities.

Linda Hesselman University College London

Archived source: 2003-10-18 website capture.