Quality adjustment of patents as an indicator of innovations

Important results from the project

The Swedish Government invests ca. 30 billion SEK every year in R&D. However, to increase wealth, the results of R&D have to be commercialized so that the consumers can benefit from more products and lower prices. The purpose with the project is to find new measurements to identify: 1) innovations; and 2) successful innovations in the private sector. In this project, patents have been quality adjusted to find out which patents probably have led to innovations. An index that indicates innovations has been constructed. It should be possible to apply this index on different patent databases.

Expected long term effects

The expectations are to find one or several quality measures on patents that indicate whether commercialization of the patent has occurred or not (i.e. whether innovations have been introduced). Policy-makers should then be able to use this index to identify in which countries, regions and sectors innovations have been introduced. We have succeeded in predicting the probability that a patent has led to: 1) an innovation; and 2) a successful innovation. The results are valid for patents owned by small firms and individuals.

Approach and implementation

A unique database on Swedish patents have been used, which includes information on whether patents have been commercialized or not. The commercialization variable measures if, when and how the patent was commercialized and whether the commercialization was successful in profit terms. The commercialization variables have been statistically related to traditional patent quality indicators (patent renewal, forward citations, patent equivalents). Thereafter, we have estimated predicted probabilities that a patent has led to: 1) an innovation and 2) a successful innovation.