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Do Firms Face a Trade-Off between the Quantity and the Quality of Their Inventions?

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  • Gaétan de Rassenfosse

    (Melbourne Institute of Applied Economic and Social Research, The University of Melbourne; Intellectual Property Research Institute of Australia, The University of Melbourne)

Abstract

This paper presents evidence that firms face a trade-off between the quantity and quality of their research output. The econometric analysis uses survey data on patent applicants at the European Patent Office and addresses the identification problem caused by differences in firms’ propensity to patent. The existence of a trade-off emphasizes the need to take the quality of research output into account when assessing research productivity. It also raises questions about the optimal quantity–quality mix that firms should target.

Suggested Citation

  • Gaétan de Rassenfosse, 2013. "Do Firms Face a Trade-Off between the Quantity and the Quality of Their Inventions?," Melbourne Institute Working Paper Series wp2013n06, Melbourne Institute of Applied Economic and Social Research, The University of Melbourne.
    • Handle: RePEc:iae:iaewps:wp2013n06
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    References listed on IDEAS

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    Cited by:

    1. Boeing, Philipp & Mueller, Elisabeth, 2015. "Measuring patent quality in international comparison: Index development and application to China," ZEW Discussion Papers 15-051, ZEW - Leibniz Centre for European Economic Research.
    2. Heller, David, 2024. "Financial market integration and the effects of financing constraints on innovation," Research Policy, Elsevier, vol. 53(4).
    3. Zhang, Gupeng & Duan, Hongbo & Wang, Shouyang & Zhang, Qianlong, 2018. "Comparative technological advantages between China and developed areas in respect of energy production: Quantitative and qualitative measurements based on patents," Energy, Elsevier, vol. 162(C), pages 1223-1233.
    4. Thompson, Mark James & Woerter, Martin, 2020. "Competition and invention quality: Evidence from Swiss firms," Technological Forecasting and Social Change, Elsevier, vol. 156(C).
    5. Naomi Fukuzawa & Takanori Ida, 2016. "Science linkages between scientific articles and patents for leading scientists in the life and medical sciences field: the case of Japan," Scientometrics, Springer;Akadémiai Kiadó, vol. 106(2), pages 629-644, February.
    6. Meng, Qiaoyu & Li, Yi & Cao, Qinwei, 2024. "The paradox analysis and functional mechanism between R&D efficiency and transformation effect: Evidence from key universities in China," Technovation, Elsevier, vol. 130(C).
    7. Claire Brunel & Thomas Zylkin, 2022. "Do cross‐border patents promote trade?," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 55(1), pages 379-418, February.
    8. Guijie Zhang & Guang Yu & Yuqiang Feng & Luning Liu & Zhenhua Yang, 2017. "Improving the publication delay model to characterize the patent granting process," Scientometrics, Springer;Akadémiai Kiadó, vol. 111(2), pages 621-637, May.
    9. Burak Dindaroğlu, 2018. "Determinants of patent quality in U.S. manufacturing: technological diversity, appropriability, and firm size," The Journal of Technology Transfer, Springer, vol. 43(4), pages 1083-1106, August.
    10. Rinat Zhanbayev & Saule Sagintayeva & Abildina Ainur & Anton Nazarov, 2020. "The Use of the Foresight Methods in Developing an Algorithm for Conducting Qualitative Examination of the Research Activities Results on the Example of the Republic of Kazakhstan," Mathematics, MDPI, vol. 8(11), pages 1-19, November.
    11. Ana Cuadros & Antonio Navas & Jordi Paniagua, 2022. "Moving ideas across borders: Foreign inventors, patents and FDI," The World Economy, Wiley Blackwell, vol. 45(12), pages 3652-3678, December.
    12. Naomi Fukuzawa & Takanori Ida, 2014. "Science linkages focused on star scientists in the life and medical sciences: The case of Japan," Discussion papers e-14-006, Graduate School of Economics Project Center, Kyoto University.
    13. Stucki, Tobias & Woerter, Martin, 2019. "The private returns to knowledge: A comparison of ICT, biotechnologies, nanotechnologies, and green technologies," Technological Forecasting and Social Change, Elsevier, vol. 145(C), pages 62-81.
    14. Fan Li & Wenche Wang & Zelong Yi, 2018. "Cross-Subsidies and Government Transfers: Impacts on Electricity Service Quality in Colombia," Sustainability, MDPI, vol. 10(5), pages 1-15, May.
    15. Jiri Schwarz & Martin Stepanek, 2016. "Patents: A Means to Innovation or Strategic Ends?," Working Papers IES 2016/08, Charles University Prague, Faculty of Social Sciences, Institute of Economic Studies, revised Apr 2016.
    16. Zhao, Shengchao & Zeng, Deming & Li, Jian & Feng, Ke & Wang, Yao, 2023. "Quantity or quality: The roles of technology and science convergence on firm innovation performance," Technovation, Elsevier, vol. 126(C).

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    More about this item

    Keywords

    Innovation performance; invention quality; invention quantity; patent explosion; propensity to patent; research productivity;
    All these keywords.

    JEL classification:

    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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