Archiv Detail

Speaker:
Salomé Baslandze (Federal Reserve Bank of Atlanta)

Patents to Products: Product Innovation and Firm Dynamics
^{(joint with David Argente, Douglas Hanley, Sara Moreira)}

Abstract: We study the relationship between patents and actual product innovation in the market, and how this relationship varies with firms’ market share. We use textual analysis to create a unique data set that links patents to products in the consumer goods sector. We document that while more than half of innovation comes from never-patenting firms, patents on average reflect product innovation, but this relationship crucially depends on a firm’s size. We show empirically and theoretically that as firmsize increases, patent filings are less reflective of innovation in the market and are more likely to be used to deter competition.

Website