Guest Post by Professor Chien: Inequality, Innovation, and Patents

Visitor post by Colleen V. Chien, Associate Professor of Law at Santa Clara College College of Law. Thanks to the USPTO Place of work of the Chief Economist and Innography for sharing patent knowledge.

Just in excess of a week back, the United States proposed tariffs on in excess of 1,000 Chinese imports in response to numerous mental assets grievances. China responded with a number of proposed counter-tariffs. A person of the most notable, as perfectly as regrettable, aspects of China’s proposed tariffs—which closely concentrate on American soybeans and pork—is that harms to U.S. producers would evidently disproportionately drop on particular Midwestern states that had previously benefited from entry to Chinese markets.

I argue in a new functioning paper concentrated on the often-missed problem of how innovation is dispersed among numerous settings that just as trade creates winners and losers, so as well does patented innovation. Developments in the accessibility and good quality of open up patent knowledge, mostly manufactured possible by the USPTO’s Place of work of the Chief Economist, provide a way to examine distributional queries that have extensive been at the heart of the patent procedure.  Specifically, the knowledge can give insight into the participation of small and unbiased innovators, the function of foreigners, and geographic and corporate focus of patenting. It has also permitted latest conversations regarding who turns into an inventor and the extent to which innovation creates or destroys jobs.

As the paper paperwork, shifts in patented innovation in excess of the previous a number of many years have contributed to broader social and financial shifts absent from production-centered, domestic, and unbiased innovation, and towards electronic, foreign, coastal, and corporate innovation – validating both of those optimistic accounts of immigration-driven, electronic prosperity and pessimistic accounts of the shrinking function of domestic, production-centered innovation. As the Determine[1] down below reveals, the change in innovation towards urban and coastal places also corresponds with, although is not essentially brought on by, the a lot more liberal political attitudes of these places. Also talked about in the paper are remaining and appropriate wing “patent populism” – targeting both of those effective IP “maximalists” and effective IP “minimalists.”

Fig. 1F: 2015 Patents for each 10K Capita                  Fig. 1G: 2016 Presidential Election Success

County Patent Density % Trump % Clinton
<3 patents 66.1% 39.9%
3+ patents 32.9% 67.1%

Data Sources: USPTO,[2] US Census,[3] Data.world (election data),[4]Author’s Analysis, Distributions calculated based on covered population in counties

However, to those of us who participate in the patent system, perhaps what is most striking is the increasingly unequal distribution of new patents to the point where 53%  of patent grants in 2016 were issued to the top 1% of grantees (up from 38% in 1986). Industry effects are strong, with some 83% of 2016 “electrical engineering” patents[5] going to the top 10% (as compared to 61% of chemistry[6] patents), but cannot explain the long-term trend. As the paper also details, while patent inequality is at a historic high, the share of small and micro entity patenting also appears to be at its lowest point in recent decades, though, not for the reasons you might suspect. (You’ll need to read the paper for the full story.)

Data Sources: USPTO PatentsView, Innography

Some of implications of the data are discussed in the paper, which raises more questions than it answers. Whatever one takes from them, however, it is clear, at least in my mind, that there is much to be learned by looking at not just the amount of patented innovation, but at how it is distributed.

[1] Produced by the talented Santa Clara Law 3L student Jerome Ma.

[2] 2015 Patent Listing by US County (available at https://www.uspto.gov/web/offices/ac/ido/oeip/taf/reports_cbsa.htm)

[3] https://www.census.gov/data/datasets/2017/demo/popest/counties-total.html

[4] https://data.world/garyhoov/2016-pres-election-by-county

[5] A category defined by the scheme used by WIPO laid out by Shmoch, as including digital communications, computer technology, communications processes, telecommunications, and semiconductors.

[6] A category defined by the scheme used by WIPO laid out by Shmoch, as including pharmaceuticals, biotechnology, chemistry and environmental innovations.

 

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