Do formal intellectual property rights hinder the free flow of scientific knowledge? An empirical test of the anti-commons hypothesis

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Citation: Fiona Murray, Scott Stern (2007) Do formal intellectual property rights hinder the free flow of scientific knowledge? An empirical test of the anti-commons hypothesis. Journal of Economic Behavior & Organization (RSS)

doi: 10.1016/j.jebo.2006.05.017


Tagged: Economics (RSS) Business (RSS), Innovation (RSS)


Summary:

Traditionally, patents have been viewed reasonably favorably as a means of promoting the creation of new knowledge (e.g., Arrow 1962). In an influential article in Science, Heller and Eisenberg (1998) argued that patents could lead to an "anticommons" where research and progress would be inhibited through knowledge closed off by patents. Murray and Stern's article is an attempt to help mediate between these two ideas and to test for the presence of an anticommons around patented academic research.

Murray and Stern exploit the fact that in biotechnology research (an architypal example of pasteur's quadrant, patents and papers are often associated with the same innovation or breakthrough but that patents were granted much later (usually after a three year lag). To test their theory, they build a dataset from all 340 papers published in Nature Biotechnology published in a three-year period (1997-1999). They first test whether citation patterns are different for research that is ultimately patented. They then take advantage of the lag between patent applications and patent grants to treat papers as essentially existing under two different regimes: an early stage where the knowledge is unpatented and a later period where it is patented. The authors find a modest, but significant, negative effect associated with the granting of the patent and, as a result, find support for at least a small anticommons effect.

Importantly, they do not offer a mechanism for what might be driving an anticommons effect -- perhaps a promising area for future work.

Theoretical and practical relevance:

In the first three years since it's publication, it's been cited more than 200 times and provides a solid econometric attempt to measure a phenomena that had been discussed widely before but that had resisted empirical analysis.