Firm Size and the Use of Intellectual Property Rights*

Abstract

Innovation markets are often characterised by market failure because inventions typically incur high fixed costs relative to marginal costs and their intellectual capital is non‐excludable. Intellectual property (IP) rights may attenuate this problem by providing legal recourse for firms to stop imitation by rivals. As IP rights are costly to acquire and enforce, it is often argued that SMEs are disadvantaged in their ability to utilise IP rights. This paper examines the intensity of IP usage by firm size and finds that SMEs actually have higher rates of patent, trade mark and design usage once industry effects are controlled for.

Intellectual Property in Mexican Small Business: An Empirical Research

“…This can create disadvantages to SMEs when compared with big enterprises in the development of skills for the use of intellectual property rights which produce a low level of innovation in SMEs (Cordes et al, 1999;WIPO, 2003;Macdonald, 2004;Jensen & Webster, 2006). The investigation of Arundel and Kabla (1998) provides empirical evidence by showing that SMEs from Europa have a low tendency to patent their innovations in comparison to big enterprises.…”

“…The investigation of Arundel and Kabla (1998) provides empirical evidence by showing that SMEs from Europa have a low tendency to patent their innovations in comparison to big enterprises. In a more recent study, Jensen and Webster (2006) proved that SMEs from Australia have lower patent registrations, trademarks and industrial designs than big enterprises.…”

“…The existence of traditional markets with no level of innovation is an important aspect that gets an increasing interest among researchers focused in the development and implementation of market policies because innovation is usually acknowledged as an essential element that can provide higher productivity and growth in nations (Jensen & Webster, 2006). As a result, government authorities have implemented a series of public policies or rights of appropriation such as the intellectual property rights which have soften the effects of the low level of innovation of markets as they provide legal resources to enterprises in an effort to prevent imitations from their competitors.…”

La licence défensive

“…À ce titre, nous confirmons donc que les petites entreprises brevètent prioritairement les innovations qui ont une valeur de marché suffisante pour envisager un dépôt dans plus de 10 pays différents (Obayashi et Yamada, 2009). Enfin, les données du LES confirment que le recours aux licences est en moyenne plus important au sein des grandes entreprises (et ce quel que soit le type d'accord considéré), compte tenu de leur plus grande propension à breveter (Jensen et Webster, 2006). …”

How Does Patent Litigation Influence Dynamic Risk for Market Competitors?

“…Lakdawalla and Sood (2009) discussed the characteristics of the electronics, biology, pharmaceutical, telecommunications and manufacturing industries, as well as the differences in innovation capabilities of those industries (Lakdawalla, Sood 2009;Cooke 2002;Tseng, Wu 2007). Jensen and Webster (2006) used patent data to study the relationship between firm size and patent intensities in Australia. Bessen andMaskin (2009) andGeradin et al (2011) found that the number of patents is highly correlated with firm size, and larger companies tend to treat patents as a competitive niche (Kim et al 2008;Blind et al 2009;Trippl, Maier 2010).…”