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Patenting and Innovation in China: Incentives, Policy, and Outcomes

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Patenting and Innovation in China: Incentives, Policy, and Outcomes CHILDREN AND FAMILIES The RAND Corporation is a nonprofit institution that helps improve policy and EDUCATION AND THE ARTS decisionmaking through research and analysis. ENERGY AND ENVIRONMENT HEALTH AND HEALTH CARE This electronic document was made available from www.rand.org as a public service INFRASTRUCTURE AND of the RAND Corporation. TRANSPORTATION INTERNATIONAL AFFAIRS LAW AND BUSINESS Skip all front matter: Jump to Page 16 NATIONAL SECURITY POPULATION AND AGING PUBLIC SAFETY Support RAND SCIENCE AND TECHNOLOGY Browse Reports & Bookstore TERRORISM AND Make a charitable contribution HOMELAND SECURITY For More Information Visit RAND at www.rand.org Explore the Pardee RAND Graduate School View document details Limited Electronic Distribution Rights This document and trademark(s) contained herein are protected by law as indicated in a notice appearing later in this work. This electronic representation of RAND intellectual property is provided for non- commercial use only. Unauthorized posting of RAND electronic documents to a non-RAND website is prohibited. RAND electronic documents are protected under copyright law. Permission is required from RAND to reproduce, or reuse in another form, any of our research documents for commercial use. For information on reprint and linking permissions, please see RAND Permissions. This product is part of the Pardee RAND Graduate School (PRGS) dissertation series. PRGS dissertations are produced by graduate fellows of the Pardee RAND Graduate School, the world’s leading producer of Ph.D.’s in policy analysis. The dissertation has been supervised, reviewed, and approved by the graduate fellow’s faculty committee. Dissertation Patenting and Innovation in China Incentives, Policy, and Outcomes Eric Warner C O R P O R A T I O N Dissertation Patenting and Innovation in China Incentives, Policy, and Outcomes Eric Warner This document was submitted as a dissertation in November 2014 in partial fulfillment of the requirements of the doctoral degree in public policy analysis at the Pardee RAND Graduate School. The faculty committee that supervised and approved the dissertation consisted of Charles Wolf, Jr. (Chair), Shanthi Nataraj, and Christopher Eusebi. PARDEE RAND GRADUATE SCHOOL The Pardee RAND Graduate School dissertation series reproduces dissertations that have been approved by the student’s dissertation committee. The RAND Corporation is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND’s publications do not necessarily reflect the opinions of its research clients and sponsors. R® is a registered trademark. Permission is given to duplicate this document for personal use only, as long as it is unaltered and complete. Copies may not be duplicated for commercial purposes. Unauthorized posting of RAND documents to a non-RAND website is prohibited. RAND documents are protected under copyright law. For information on reprint and linking permissions, please visit the RAND permissions page (http://www.rand.org/publications/permissions.html). Published 2015 by the RAND Corporation 1776 Main Street, P.O. Box 2138, Santa Monica, CA 90407-2138 1200 South Hayes Street, Arlington, VA 22202-5050 4570 Fifth Avenue, Suite 600, Pittsburgh, PA 15213-2665 RAND URL: http://www.rand.org/ To order RAND documents or to obtain additional information, contact Distribution Services: Telephone: (310) 451-7002; Fax: (310) 451-6915; Email: [email protected] Contents Abstract ......................................................................................................................................................... v Acknowledgements ..................................................................................................................................... vii Chapter 1: The Chinese patent boom – Incentives and Implications ........................................................... 1 Introduction .............................................................................................................................................. 1 Innovation – measuring technical change and inventiveness .................................................................. 2 The advantages of patents as an innovation measure ............................................................................. 3 Patent design, use, and value ................................................................................................................... 4 Intellectual property systems and innovation .......................................................................................... 8 Markets, innovation, and economic effects ............................................................................................. 8 The case of China .................................................................................................................................... 11 Summary ................................................................................................................................................. 20 Policy Recommendations ........................................................................................................................ 22 Conclusions ............................................................................................................................................. 23 References .............................................................................................................................................. 25 Chapter 2: Do Indigenous Innovation Policies Work? Evidence from China .............................................. 31 Glossary ................................................................................................................................................... 32 Introduction ............................................................................................................................................ 33 Background ............................................................................................................................................. 34 Literature ................................................................................................................................................ 36 Data ......................................................................................................................................................... 37 Analytical Approach ................................................................................................................................ 40 Results ..................................................................................................................................................... 45 Contribution and limitations ................................................................................................................... 53 Conclusion ............................................................................................................................................... 55 Appendix: Indigenous Innovation Catalog .............................................................................................. 56 Appendix: WIPO Technology‐IPC Concordance Table ............................................................................ 60 Appendix: Indigenous Innovation Firm Awardees .................................................................................. 63 References .............................................................................................................................................. 65 Chapter 3: Measuring Innovation: How Innovative are Leading Chinese Firms? ....................................... 68 Introduction ............................................................................................................................................ 68 Literature Review .................................................................................................................................... 69 iii Data ......................................................................................................................................................... 73 Methodology ........................................................................................................................................... 74 Analysis ................................................................................................................................................... 79 Descriptive analysis ............................................................................................................................. 79 S‐ Curve analysis .................................................................................................................................. 81 Comparative analysis of innovative patents ....................................................................................... 85 Analysis of newly emergent sectors ................................................................................................... 87 Contributions, limitations, and conclusions ............................................................................................ 89 Appendix: Receiver Operating Characteristic Curves and Optimal Coefficients .................................... 91 Appendix: Name Harmonization and Firm Identification ....................................................................... 94 iv Abstract China has undergone a patenting boom, with yearly increases in patent applications
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