For studying sources of economic growth, pace of technological change or competitive position of companies and countries, direct measures are lacking. As a consequence, researchers and policy makers are committed to using related indicators or ‘proxies’. Patent statistics are an appropriate ‘proxy’ for technological and innovative activity. Indeed, the analysis of patent information is considered to be one of the best established, readily available and historically reliable methods for quantifying the output of science and technology systems. Patent indicators can be traced back over relatively long periods, allowing for accurate mappings of the timing of innovation on several levels of analysis.
Patent-related indicators have a number of methodological and technical benefits, but – like any other indicator – they have limitations that must be taken into account. The following table summarizes.
Benefits of patent-related indicators
- The close relation of patents to the outcome of industrial R&D and other inventive and innovative activities, enhances their value as a proxy indicator.
- The broad accessibility and availability of electronic patent databases have made the use of patent statistics much easier.
- Patent documents contain detailed information on the level of: relevant dates (request, grant, ...), technological classification, applicants and inventors (including addresses), citations,...
- Patents are present in almost every technology domain that is useful for analyzing the diffusion of core technologies (except software, which is usually protected by copyright).
- The detailed technological classification of patent documents (by IPC codes) allows for a range of options in levels of aggregation; from broad technological areas to specialized technological niches.
Limitations of patent-related indicators
- Not all inventions are patented. And not all patents reflect innovative inventions. Innovation is more than just what is patented.
- Patents vary greatly in value.
- Companies vary in their propensity to patent (number of patents per unit of R&D spending).
- Technological domains vary in their propensity to patent.
- Countries and regions vary in their propensity to patent: differences in size and geographical position lead to different expectations about the outcome and sense of patent protection.
- Complex differences between national systems in terms of legal, geographic, economic and cultural factors limit the comparability of patent-related indicators.
Regardless of such limitations, patents remain a unique resource for studying the processes that lead to technological change. If patent statistics are used to answer questions about economic growth, the pace of technological change or the competitive position of companies and countries, a number of additional comments need to be kept in mind for an accurate interpretation of findings.
The term ‘patent rationale’ refers to the different motives that can lead to the decision to a patent application or to refrain from it. The economic literature has devoted much attention to strategic patenting behavior of companies. Empirical studies have shown that active involvement in innovation does not necessarily mean that companies apply for patents. In addition, it is noted that companies do not file patents on all of their inventions or technological developments. Other mechanisms such as secrecy, quick market launch or product complexity may complement or even substitute for patenting behavior.
Potential strategic considerations have important implications for the interpretation of patent statistics as a measure of the degree of innovation of companies and countries. The following points should be taken into account:
- Not all inventions are commercialized and used, hence they do not all necessarily lead to innovation.
- Not all inventions are patentable; and those that are, are in practice not necessarily patented.
- Companies may patent for objectives other than commercial exploitation of the invention.