patent premium我的资源Patent Premium 20191212 To Bill Barnettx

The Patent Premium of for Foreign Firms Innovating in Weak IPR Emerging Markets with Weak Intellectual Property Rights ProtectionsSP: Its best to spell everything out in the papers title. I know that is broadly familiar, but some members of your reading audience may be less familiar with it.AbstractThe wWeak intellectual property rights (IPR) protections in emerging markets poses a critical challenge for to foreign firms attempting to appropriate returns from innovations in these markets. This study investigates the to what extent to which, if at all, foreign firms in emerging markets, if they do so at all, obtain a patent premium, defined as an incremental productivity gains from a firms patents that it would not obtain compared with its productivity had the firm it not owned any patents. Drawing on theoretical insights from the institutional theory and the liability of foreignness (LOF) logic, and using a panel data set of representing the performance of 32,901 firms in Chinas high-tech industries, we find that foreign firms do obtain a patent premium despite the countrys weak IPR protection in the country. However, the The level of the patent premium is, however, significantly lower for foreign firms than for domestic firms, consistent with the LOF logic. We also find that a foreign firms patent premium increases substantially with institutional development, and to an even greater extent more so among wholly owned foreign subsidiaries (WOSs) vis-vis than among international joint ventures (IJVs). This finding offers further support for the LOF logic insofar as institutional development lowers the LOF for foreign firms, particularly for WOSs. These findings provide implications for to foreign firms regarding their innovation strategies in weak IPR emerging markets with weak IPR protections and to for host- country governments in making when formulating their innovation policies.Keywords: Patent premium, IPR, innovation, institutions, emerging economyINTRODUCTIONIt has been a big paradoxical question to both sScholars and executives alike have puzzled over a paradoxical question for some time: Can innovation and patents pay off for foreign firms competing in large emerging markets where market opportunities are enormous yet intellectual property rights (IPR) protection is rather limited? The last decade has witnessed a surge of innovation activities of undertaken by multinational enterprises (MNEs) competing in foreign emerging markets (Sartor & Beamish, 2014; Zhang, Li, Hitt, & Cui, 2007; Zhao, 2006). Patent statistics reveal that the number of invention patent applications received by the National Intellectual Property Administration of China (CNIPA), for instance, increased from 63,000 in 2001 to 1.54 million in 2018, representing a staggering 24-fold growth rate. China surpassed the US since in 2011, becoming the worlds biggest country in receiving largest receiver of patent applications.This phenomenon is striking considering the weak institutional environment and IPR protection that characterizes in these most emerging economies RF: When you move to a new paragraph you should be more explicit when mentioning a topic raised in the previous paragraph. Pronouns such as should refer to terms within a paragraph, not to terms from previous paragraphs.(Brander, Cui, & Vertinsky, 2017; Peng, Ahlstrom, Carraher, & Shi, 2017). Patenting as a formal appropriation mechanism may not be viable in the emerging economies where law enforcement for related to IPR is weak, because the effectiveness of patenting primarily depends primarily on the quality of a national law legal system and the institutional environment in which firms operate (Athreye, Batsakis, & Singh, 2016; Santangelo, Meyer, & Jindra, 2016; Schankerman, 1998; Somaya, 2012). In such cases, innovators may count on other informal appropriation mechanisms, such as secrecy, control of complementary resources, or and ILL: In many contexts, including this one, the phrase is understood not to introduce an exhaustive listit signals a list of examples from among a larger set that might have been listed explicitly. Thus incorporates the logical force of and imposes it on the list, so you should use as the conjunction, because all of the listed items are examples of informal mechanismsusing might be taken to mean that at least one is not.taking advantage of lead time (“first to market”) to capture value from innovations (Hall, Helmers, Rogers, & Sena, 2014; Teece, 1986). The wWeak IPR protection leads to weakens incentives to patent and therefore poses a critical challenge for to MNEs attempting to appropriate returns from patenting in emerging economies (Zhao, 2006).This paradox has prompted researchers to investigate the conditions that are have been motivating the rapid growth of patenting in these countries (Hu & Jefferson, 2009; Huang & Li, 2019; Keupp, Friesike, & von Zedtwitz, 2012). It has been recognized that market size and economic advancement development may offset some disincentives of for patenting activities caused by weak IPR protection (Ginarte & Park, 1997; Luo, 2003), and governmental support for innovation (e.g.,P: I now advise clients not to follow such abbreviations (including ) with commas, as the latest edition of the Chicago Manual of Style recommends not using them. favorable tax treatment and a research-and-development R&D subsidy) may incentivize firm-level patenting activities despite the existence threat of patent infringement (Dang & Motohashi, 2015; Li, 2012). Others also suggest that improved physical infrastructure and geographic clusters for innovation are conduits of for patenting undertaking (Hu & Mathews, 2005; Porter & Stern, 2001).Despite these scholarly efforts, much it remains to be learned about unanswered to what the extent to which, if it is true at all, patenting is valuable pays off for foreign firms investing in large emerging markets characterized by weak IPR protection. Combining insights from the institutional theory and the liability of foreignness logic (LOF) logic, we aim to assess how valuable patenting is for foreign firms in these economies. We denote the value of patenting by reference to a patent premium, generally referring denoting to incremental gains in to the value of technological innovations that are realized by patenting them (Arora, Ceccagnoli, & Cohen, 2008)Arora, 2008, R&D and the Patent Premium;Arora, 2008, R&D and the Patent PremiumArora, 2008, R&D and the Patent Premium;Jensen, 2011, Estimating the patent premium: Evidence from the Australian Inventor Survey, and specifically in this study connoting incremental productivity gains derived from a firms patents that it would not have realized compared with its productivity had the firm it not owned any patents.The ideal method to estimate for estimating the patent premium is to compare the productivity of a patent-owning firm with its productivity had the firm it not owned any patents, but the productivity of a patent-owing firm had it not owned any patents is hard to observe. In order to To provide robust evidence that might settle this question, we employ a matching and difference-in-differences WW: A fairly large majority of papers Ive seen (I researched this several years ago) use the plural form, , when referring to this method.method on with a large dataset of high-technology (high-tech) companies competing in China, the largest emerging market that features well with abundant market opportunities and but weak IPR protection in most sectors. We construct the dataset by matching the data from Chinas National Bureau of Statistics Annual Survey of Industrial Enterprises with the patent data from the the National Intellectual Property Administration of China (CNIPA)SP/NC: You have already introduced this abbreviation. After doing so you should use it exclusively and consistently throughout the rest of the paper. The dataset covers 32,901 firms in Chinas high-tech industries (in which foreign firms actively operate) during a ten-year period of running from 1998 through 2007.Our longitudinal analysis offers some interesting and important insights. First, we find a significantly positive patent premium among for foreign firms despite theChinas weak IPR system in China, validating the extensive patenting activities of foreign firms in the country. Second, foreign firms obtain a lower patent premium than domestic firms, informing confirming the presence of the LOF and the disadvantage of that foreign firms vis-vis face against their domestic peers in appropriating returns from patents and transforming technological innovation into productivity gains in emerging markets. Third, institutional development can effectively reduce the LOF of that foreign firms experience, hence so foreign firms the patent premium for foreign firms increases substantially with institutional development, and all the more so among wholly owned foreign subsidiaries (WOSs) vis-vis when compared with international joint ventures (IJVs). This finding offers further support for the LOF logic, as institutional development lowers the LOF for foreign firms, particularly for WOSs. Surprisingly, we find that the patent premium of for domestic firms decreases with institutional development, indicating that institutional development may undermine the advantage of localness that domestic firms would seem to enjoymay encounter a deterioration in their advantage of localness with institutional development.This study makes important contributions to the literature. First, we address the question why a firm with a given innovation would prefer formal over informal IPR, or vice versa is an important question related to corporate the firms strategy of for profiting from innovation. Most of the previous studies (Arundel & Kabla, 1998; Cohen, Nelson, & Walsh, 2000; Graham & Sichelman, 2008; Levin, Cohen, & Mowery, 1985) have provided evidence in the context of developed economies, where the institutional environment BX: Which is the institution?is mature and robust. However, Yet this important question remains under-studied in the setting of emerging-economy setting economies where the IPR systems are weak remains under-studied. To the our best of our knowledgeWW: I am suggesting a formulation of this idea that will be much more familiar to most English-speaking readers., this study is the first to empirically assess the patent premium in an emerging economy. By presenting confirming the presence of a significantly positive patent premium among foreign firms operating in a large emerging economy, our findings reveal that foreign firms can gain achieve higher productivity by with patenting innovations than by not vis- -vis without patenting them. Thus, patenting can be a viable appropriation mechanism for foreign firms seeking to profit from innovation, even in large emerging markets with weak IPR systems. As such, our study addresses the paradox between the facts of that rapidly growing patenting activity and is found weak IP protection in a large emerging economyeconomy with weak IPR protections, that is namely China.Second, the concept of LOF concept describes implies that multinational corporations operating in foreign markets incur additional costs in comparison to that domestic competitors avoid when operating in foreign markets (Kostova, Roth, & Dacin, 2008; Kostova & Zaheer, 1999; Zaheer, 1995). One of Among the sources of the LOF is foreign firms inadequate knowledge of athe host countrys culture, norms, values, and business practices, known collectively which is referred to as “unfamiliarity hazards” (Eden & Miller, 2001; Zaheer, 1995). Along with culture, norms, values, and practices, uUnfamiliarity with formal institutions such as laws, regulations, constitutions, contracts, and property rights in host countries may also subject firms lead to the LOF. Our study contributes to this stream of literature by arguing that foreign firms inferior relatively poorer ability to leverage capabilities, in comparison to domestic firms, in leveraging competitive opportunities associated with owning patents and using relationship-based strategies to overcome institutional hazards in the emerging markets make it more difficult to appropriate returns from an innovation by means of patent protection. Further, we demonstrate that because IJVs are more capable of dealing with overcoming the challenge of institutional voids and suffer less severely from the LOF in comparison to than WOSs do (Li, Yang, & Yue, 2007; Meyer, 2001), when institutions develops and the LOF is reduced, WOSs are thus able to reap greater reap more benefits from patenting than IJVs.Third, the institutional theory (DiMaggio & Powell, 1983; Scott, 1987) and the literature of on the institution-based view of strategy (Oliver, 1991; Oliver, 1997) argue that organizations are influenced by institutions, to an even greater extent more so during periods marked by significant institutional change (Meyer, Mudambi, & Narula, 2011; Peng & Zhou, 2005). However, the The impact from of institutional development is not, however, equally severe on every organization in an institutional setting given that the varying extents to which an organizations relies rely on external institutions (Pfeffer & Salancik, 1978), its the strategic intent to exploit opportunities during made available by institutional change (Hitt, Ahlstrom, Dacin, Levitas, & Svobodina, 2004), and its capability of coping the capacity to cope with institutional dynamics vary (Hillman & Keim, 1995). This study extends this line of research by showing that foreign firms patent premium responds is more favorably disposed to the improvements of in IPR institutions than that does that of local firms. We exhibit strong evidence on pertaining to institutional complexity in general and institutional incompatibility in particular, suggesting that subnational variance in institutional conditions exerts an important impact on patenting activities and rewards. We can achieve a fuller An understanding of this institutional logic is fuller if we unite the institutional void logic (weak IPR protection) and with the institutional complexity logic (institutional fragility and incompatibility across different locations within a country) in analyzing the innovation success of both foreign and local firms in an emerging market.THEORETICAL DEVELOPMENTPatenting under Weak IPR ProtectionPatenting has long been recognized as a differentiating mechanism, providing owners with the right to exclude others from using the an invention without their permission for a limited period of time (Mansfield, 1986; Ziedonis, 2004). The exclusionary power of patent rights can bring market power (Bessen, 2009) and allow firms to pursue additional profit opportunities and gain competitive advantage (Gambardella, 2013; Somaya, 2012). While this logic generally applies to firms in every country, the actual returns on or benefits of patenting will vary significantly vary depending on with institutional and market environments. Firms seeking to carry out patenting activities abroad will Pperhaps, encounter there is no country that brings in such greater complexity and paradox for firms to deal with patenting activities as in large emerging economies like China and India than in smaller emerging markets. Chinas and Indias Mmarkets are huge, yet IPR protection remains weak. Albeit Although AWK: You can substitute for in many contexts, but here it sounds awkward. some of these governments have been making efforts in to protecting patent rights more effectively, especially those that have joined after joining the World Trade Organization (WTO), legal enforcement of IPR protection is impeded by a plentitude of perilous issues such as public empathy of with copycatting (Luo, Sun, & Wang, 2011), weak judiciary and administrative systems in related to IPR (Bosworth & Yang, 2000; Wang, 2004), business and public- sector corruption (Kshetri, 2009; Liu, 2006), and political and institutional instability (Lieberthal & Lieberthal, 2003). Such institutional voids or hardships relating to patenting activities are further exacerbated by a lack of institutional transparency and limited and often selective enforcement of IPR law (Khanna & Palepu, 2013; Ostergard, 2000; Oxley, 1999). This makes it difficult to appropriate returns from innovation through patent protection, so it remains unknown whether and when patents are valuable for to firms operating in large emerging markets characterized with by weak IPR protection (Al-Aali & Teece, 2013; Schankerman, 1998; Teece, 1986).Conceptually, we examine the patent premium from the perspective of institutional logic, complemented with by the liability of foreignness LOF logic. The institutional logic we develop originates from works studies that integrate apply institutional theory (DiMaggio & Powell, 1983; Scott, 1987) and to the strategic choice WW: Its not clear what it means to a theory with a non-theoretical factor such as strategic choice. I hope you mean that you apply the theory in your analysis of this factor.that hinges in part on a firms dependence on external institutions that control critical resources (Oliver, 1991; Peng, 2003; Tolbert, 1985). This institution-based view of strategy, and in particular the strategic -response logic to in the context of institutional processes in particular (Oliver, 1991; Oliver, 1997), holds that institutional forces enact exert a strong effect on organizations, even more so during periods of institutional change (Peng & Zhou, 2005). but Yet RS: This sentence is way too long so Im going to suggest breaking it up into two sentences here.this effect is not equal to in every organizat