Abstract
The aim of this paper is to explore the factors that influence the flow of US patents to 27 OECD countries using a gravity model for the period 1995–2005. The dependent variable is the number of patents from the US to the destination country. Our findings support the hypothesis that the mass of patenting activity in the US and the destination country are significant factors in explaining the behavior of the US patenting activity abroad. A narrow technological gap between the source and the destination country indicates a high absorptive capacity of the destination country for the knowledge created in the source country and thus, the imitation risk increases providing an incentive to register the patent in the destination country. The effect of the physical distance is statistically ambiguous, possibly due to the spread of internet use. Finally, the business cycle in the destination country is not statistically significant.
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Notes
We have included, tested and rejected for alternative distance measures between US and destination countries using the World Bank Governance Indicators (e.g. Rule of Law, Accountability), the Index of Patents Rights (Ginarte and Park 1997), and the Cultural Distance using Hofstede’s cultural dimensions (Hofstede 2001).
One of the reviewers suggested to check the model’s stability without Japan since as a country exhibited a distinctive pattern compared to other countries: both RE and negative binomial models are almost identical with and without Japan. The results are not included in the paper, but are available upon request.
Absorptive capacity is the ability to identify, assimilate and exploit knowledge from the environment (Cohen and Levinthal 1989). The absorptive capacity includes the ability to internalize knowledge created by others and identifying it to fit in their own specific applications, processes and routines (Criscuolo and Narula 2007).
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Acknowledgements
This paper was written while Nikos Varsakelis was visiting the Department of Economics, University of Alicante, Spain. Nikos Varsakelis acknowledges the financial support from the Aristotle University of Thessaloniki. This paper has benefited from comments from and discussions with Christos Emmanouilidis, Kostas Katrakilidis, Konstantinos Papadopoulos and participants of the 65th International Atlantic Economic Conference (2008) and the ESRC-AIM Research Workshop (2009) at Aston Business School, the editor and two anonymous referees of this journal. The usual disclaimer applies.
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Archontakis, F., Varsakelis, N.C. US patents abroad: Does gravity matter?. J Technol Transf 36, 404–416 (2011). https://doi.org/10.1007/s10961-010-9156-9
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DOI: https://doi.org/10.1007/s10961-010-9156-9