Authors: Yanfeng Zheng and Qinyu Wang
Abstract: Does globalization breed global knowledge spillovers? We first examine this question using 13 million patents and their citations across 25 patent offices with a rigorous matching method. The results show that cross-country knowledge spillovers have surprisingly declined during 1990-2010. We then develop hypotheses intrigued by this counterintuitive trend through a legal perspective. We contend that the global harmonization and enhancement of patent systems encouraged cross-country patenting, which deterred international knowledge spillovers by privatizing knowledge globally. We test the hypotheses by employing a difference-in-differences approach on a matched sample of US patent applications of 12,828 inventions from Europe during 2001-2010. We find that granting a US patent reduces knowledge spillovers from the European invention to the US. This effect becomes stronger if the patent owner is more litigious. Our study offers a fresh perspective on global intellectual property rights and adds a nuanced understanding to cumulative innovation in a globalized economy.
Full paper on SSRN: https://ssrn.com/abstract=4012857
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