Patent Activity and Technical Change

Robert L. Basmann, Michael McAleer and Daniel Slottje
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Robert L. Basmann: Department of Economics, Binghamton University

No CIRJE-F-217, CIRJE F-Series from CIRJE, Faculty of Economics, University of Tokyo

Abstract: This paper presents an aggregate production function of the generalized Fechner-Thurstone (GFT) form to analyze the impact of an important component of intellectual industrial property, namely patent activity, on technical change in the USA for the period 1947-1981. We define a technology-changer as a variable that has an impact on the elasticity of the marginal rate of technical substitution (mrts) between inputs of the GFT production function over time. Various types of US patent grant activity, specifically total, domestic, foreign, successful and unsuccessful patents, are used as instruments for the technology-changer. Using the GFT specification, the impacts of various technology-changers on the elasticity of the mrts between inputs are estimated directly. It is found that granted (or successful) patents, patents granted to foreign companies and individuals, total patent applications, and even unsuccessful patent applications, have significant impacts on the rates at which inputs are substituted for each other over time in production.

Pages: 22 pages
Date: 2003-03
New Economics Papers: this item is included in nep-com and nep-ind
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http://www.cirje.e.u-tokyo.ac.jp/research/dp/2003/2003cf217.pdf (application/pdf)

Related works:
Journal Article: Patent activity and technical change (2007)
Working Paper: Patent Activity and Technical Change (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:tky:fseres:2003cf217

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