Legal

Patent Creation and U.S. Inventiveness

Some argue that U.S. inventive output is flagging in the face of other related challenges, including global competition, increasing technological complexity, and weak public sector support relative to other countries. In a Brookings Institution report authored by Jonathan Rothwell, José Lobo, Deborah Strumsky, and Mark Muro, the United States still ranks very high globally on a number of important measures of innovative capacity, though other developed countries have caught up or overtaken it.

One study rates the United States fourth in the world in terms of innovative capacity but notes that it ranks near the bottom on changes over the previous ten years in the underlying variables. The authors say that when using internationally-oriented patent applications filed from 2000 to 2010 per resident, the United States ranks somewhat lower at ninth, and it is just 13th on science and engineering publications per capita.

More positively, the United States ranks third on GDP per worker, behind only Luxembourg and oil-rich Norway. On R&D spending per capita, it ranks second, behind only Finland. Finally, according to the Leiden Ranking (from Leiden University in the Netherlands), all ten of the world’s top research universities are in the United States and 43 of the top 50, led by MIT, Princeton, Harvard, and Stanford. All of these factors play a role in American innovation.

The focus of the Brookings report is on inventive activity, which yields enormous benefits to society that go well beyond the gains from inventors and producers. One measure of inventive activity—the number of patents granted per person—has been increasing in the U. S., alongside research and development. The Brookings authors add that some scholars have even suggested that too many patents have been granted and attribute an increase to the declining rigor of approval standards. Yet, there is a large body of compelling evidence showing that most patents do actually represent valuable inventions, especially “high quality” patents—meaning those that are highly cited or those that advance more intellectual property claims.

Despite wide variation in value, economists have calculated that the average patent is worth over half a million dollars in direct market value (and considerably more in social value as the technology and its ideas become diffused). These estimates are consistent with recent patent sales reported in the media from Eastman Kodak, Motorola, Nortel, and Nokia, which have ranged $477,000 to $760,000 per patent, and even single patents from relatively unknown companies list patent prices at an online website for $1 million.

In any case, there is evidence that patent value is increasing. One indication is that scientific and technical research is increasingly collaborative in the United States and globally, and this appears to be leading to more valuable patents and publications. Another is that corporate income from manufacturing sector royalties—which come largely from the licensing of patents—increased by 89 percent from 1994 to 2009, almost double the growth rate of patents granted to domestic inventors.

Read: https://www.computerworld.com/s/article/9236448/U.S._inventiveness_at_highest_point_since_Industrial_Revolution

Read: https://www.csmonitor.com/1991/0313/13072.html


Chief Executive

Chief Executive magazine (published since 1977) is the definitive source that CEOs turn to for insight and ideas that help increase their effectiveness and grow their business. Chief Executive Group also produces e-newsletters and online content at chiefexecutive.net and manages Chief Executive Network and other executive peer groups, as well as conferences and roundtables that enable top corporate officers to discuss key subjects and share their experiences within a community of peers. Chief Executive facilitates the annual “CEO of the Year,” a prestigious honor bestowed upon an outstanding corporate leader, nominated and selected by a group of peers, and is known throughout the U.S. and elsewhere for its annual ranking of Best & Worst States for Business. Visit www.chiefexecutive.net for more information.

Share
Published by
Chief Executive

Recent Posts

Rachel Barger, Cisco’s Senior Vice President of the Americas, Encourages Us to Always Keep an Open Door

In this edition of our Corporate Competitor Podcast, leadership speaker and storytelling expert Don Yaeger…

2 days ago

Boards May Need To Reevaluate Their Idea Of Acceptable Risk

Boards are being held to a higher standard regarding risk. A more thorough strategy may…

6 days ago

CEOs Can Become Afflicted With ‘Boreout’ Too

If you're experiencing burnout not because you're overworked, but because you're underinspired, it might be…

6 days ago

Why CIOs Should Report Directly To The CEO

When companies elevate the role, they reap significant benefits. Here are five critical ways it…

7 days ago

New-Era Koppers Keeps Staying Ahead Of The Game

CEO Ball has led early decoupling from China and diversification that ties into today’s infrastructure…

7 days ago

Cyberattacks: Not If, But When

You can’t be bulletproof, but you can be armed for battle.

1 week ago