Wednesday, July 22, 2009

Patent Value: the haves and have-nots

     In search of data on patent values, I've found a survey of German inventors by Dietmar Harhoff and Karin Hoisl(2006). The paper studies the impact of the German Employees' Invention Act(GEIA), a German law that regulates how employees are paid for their patents.
Check out the payment distribution chart: only 1% of patents results in a payout above 20% of salary; the remaining 99% barely make a dent in the inventors' income. Since patent awards are calculated as a percentage of value to the company, most likely, patent values vary as dramatically.


Interestingly enough, planned inventions are more valuable than spontaneous ones:

"Somewhat unexpectedly, two other R&D process variables turn out to have a significant impact. First, patented inventions that are the planned product of R&D projects are more valuable than unplanned results or mere by-products of R&D.
The surprise lies in the second R&D process variable with a positive coefficient – inventions made during the inventor’s leisure time are considerably more valuable than other types of inventions."

References:
Dietmar Harhoff and Karin Hoisl. 2006. Institutionalized incentives for Ingenuity. Discussion Paper.

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