IDEAS home Printed from https://ideas.repec.org/p/red/sed013/1029.html
   My bibliography  Save this paper

Market Effects of Patent Reform in the US Semiconductor Industry

Author

Listed:
  • Jeff Thurk

    (University of Notre Dame)

Abstract

I study the US semiconductor industry in the context of 1980s legal reform which strengthened intellectual property rights. Prior to the reform, the industry was highly concentrated in a few vertically integrated firms. Post reform, the entry of small design firms led to a fragmented industry composed of both specialty design firms and traditional production firms. I ask how much of this change in market structure can be attributed to patent reform and how much was the result of positive demand shocks from increased spending in the information technology industry. I introduce a structural model of innovation and patenting in which the entry rate of specialized design firms can increase due to either an increase in patent protection or demand. I fit the model to industry steady state and transitional dynamics using data on firm performance and patenting behavior. Policy experiments indicate the effects of stronger patent protection are minor compared with increased demand.

Suggested Citation

  • Jeff Thurk, 2013. "Market Effects of Patent Reform in the US Semiconductor Industry," 2013 Meeting Papers 1029, Society for Economic Dynamics.
    • Handle: RePEc:red:sed013:1029
    as

    Download full text from publisher

    File URL: https://red-files-public.s3.amazonaws.com/meetpapers/2013/paper_1029.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Kortum, Samuel & Lerner, Josh, 1998. "Stronger protection or technological revolution: what is behind the recent surge in patenting?," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 48(1), pages 247-304, June.
    2. Richard Ericson & Ariel Pakes, 1995. "Markov-Perfect Industry Dynamics: A Framework for Empirical Work," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 62(1), pages 53-82.
    3. C. L. Benkard & P. Jeziorski & B. Van Roy & G. Y. Weintraub, 2008. "Nonstationary Oblivious Equilibrium," Economics Working Paper Archive 568, The Johns Hopkins University,Department of Economics.
    4. Boldrin,Michele & Levine,David K., 2010. "Against Intellectual Monopoly," Cambridge Books, Cambridge University Press, number 9780521127264, November.
    5. Hall, Bronwyn H & Ziedonis, Rosemarie Ham, 2001. "The Patent Paradox Revisited: An Empirical Study of Patenting in the U.S. Semiconductor Industry, 1979-1995," RAND Journal of Economics, The RAND Corporation, vol. 32(1), pages 101-128, Spring.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Padmashree Gehl Sampath & Walter Park, 2019. "Do Patents Lead to Market Concentration and Excess Profits?," GDAE Working Papers 19-02, GDAE, Tufts University.
    2. Vivek Farias & Bar Ifrach & Gabriel Weintraub, 2012. "A Framework for Dynamic Oligopoly in Concentrated Industries," 2012 Meeting Papers 505, Society for Economic Dynamics.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Jeff Thurk, 2018. "Outsourcing, Firm Innovation, and Industry Dynamics in the Production of Semiconductors," 2018 Meeting Papers 1265, Society for Economic Dynamics.
    2. Fontana, Roberto & Nuvolari, Alessandro & Shimizu, Hiroshi & Vezzulli, Andrea, 2013. "Reassessing patent propensity: Evidence from a dataset of R&D awards, 1977–2004," Research Policy, Elsevier, vol. 42(10), pages 1780-1792.
    3. Gerard Llobet & Javier Suarez, 2010. "Entrepreneurial Innovation, Patent Protection and Industry Dynamics," Working Papers wp2010_1001, CEMFI.
    4. Koki Oikawa & Minoru Kitahara, 2017. "Technology Polarization," Working Papers e113, Tokyo Center for Economic Research.
    5. Salzberger Eli M., 2011. "The Law and Economics Analysis of Intellectual Property: Paradigmatic Shift From Incentives to Traditional Property," Review of Law & Economics, De Gruyter, vol. 7(2), pages 435-480, December.
    6. Ajay Bhaskarabhatla & Enrico Pennings, 2012. "Defensive Disclosure under Antitrust Enforcement," Tinbergen Institute Discussion Papers 12-010/2, Tinbergen Institute.
    7. Fink, Carsten & Helmers, Christian & Ponce, Carlos J., 2018. "Trademark squatters: Theory and evidence from Chile," International Journal of Industrial Organization, Elsevier, vol. 59(C), pages 340-371.
    8. Leonid Kogan & Dimitris Papanikolaou & Amit Seru & Noah Stoffman, 2017. "Technological Innovation, Resource Allocation, and Growth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 132(2), pages 665-712.
    9. Landon Kleis & Paul Chwelos & Ronald V. Ramirez & Iain Cockburn, 2012. "Information Technology and Intangible Output: The Impact of IT Investment on Innovation Productivity," Information Systems Research, INFORMS, vol. 23(1), pages 42-59, March.
    10. Jay Pil Choi & Heiko Gerlach, 2017. "A Theory of Patent Portfolios," American Economic Journal: Microeconomics, American Economic Association, vol. 9(1), pages 315-351, February.
    11. Gaétan de Rassenfosse & Kyle Higham, 2024. "Decentralising the patent system," Chapters, in: Walter G. Park (ed.), Handbook of Innovation and Intellectual Property Rights, chapter 8, pages 120-138, Edward Elgar Publishing.
    12. Lerner, Josh & Zhu, Feng, 2007. "What is the impact of software patent shifts? Evidence from Lotus v. Borland," International Journal of Industrial Organization, Elsevier, vol. 25(3), pages 511-529, June.
    13. Nancy Gallini, 2011. "Private agreements for coordinating patent rights: the case of patent pools," ECONOMIA E POLITICA INDUSTRIALE, FrancoAngeli Editore, vol. 2011(3), pages 5-30.
    14. Giovanni Dosi & Luigi Marengo & Corrado Pasquali, 2010. "How Much Should Society Fuel the Greed of Innovators? On the Relations between Appropriability, Opportunities and Rates of Innovation," Chapters, in: Riccardo Viale & Henry Etzkowitz (ed.), The Capitalization of Knowledge, chapter 4, Edward Elgar Publishing.
    15. Petra Moser, 2012. "Patent Laws and Innovation: Evidence from Economic History," NBER Working Papers 18631, National Bureau of Economic Research, Inc.
    16. Philippe Aghion & Peter Howitt & Susanne Prantl, 2015. "Patent rights, product market reforms, and innovation," Journal of Economic Growth, Springer, vol. 20(3), pages 223-262, September.
    17. Georg Graevenitz & Stefan Wagner & Dietmar Harhoff, 2013. "Incidence and Growth of Patent Thickets: The Impact of Technological Opportunities and Complexity," Journal of Industrial Economics, Wiley Blackwell, vol. 61(3), pages 521-563, September.
    18. Wilson, Nathan E., 2012. "Uncertain regulatory timing and market dynamics," International Journal of Industrial Organization, Elsevier, vol. 30(1), pages 102-115.
    19. Daron Acemoglu & Ufuk Akcigit & Harun Alp & Nicholas Bloom & William Kerr, 2018. "Innovation, Reallocation, and Growth," American Economic Review, American Economic Association, vol. 108(11), pages 3450-3491, November.
    20. Giovanni Dosi & Joseph Stiglitz, 2013. "The Role of Intellectual Property Rights in the Development Process, with Some Lessons from Developed Countries: An Introduction," LEM Papers Series 2013/23, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:red:sed013:1029. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Christian Zimmermann (email available below). General contact details of provider: https://edirc.repec.org/data/sedddea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.