Patent trading flows of small and large firms

• Published in: Research policy 2019-09, Vol.48 (7), p.1601-1616
• Main Authors: Figueroa, Nicolás, Serrano, Carlos J.
• Format: Article
• Language: English
• Subjects: Division of innovative labor; Market for patents; Market for technology; Patent reassignments; Patent sales
• ISSN: 0048-7333; 1873-7625
• DOI: 10.1016/j.respol.2019.03.002

•We provide new evidence on the sale and acquisition of patents of small and large firms.•Patents are more likely to be sold by small firms. And among patents sold, especially those sold by small firms, are disproportionately bought by small firms.•Patent sales are negatively associated with the initial innovator's patent stocks in the technology class and geographical location of the patent.•Patent acquisitions by small firms are positively associated with the share of small firms' patents (relative to all firms) in the technology class and geographical location of the patent sold. This article provides new evidence on the patent trading flows of small and large firms. We document aggregate patterns of patent sales and acquisitions of small and large firms. We also examine the extent to which the initial innovator's and the potential buyers’ prior knowledge stocks in the same technology area and in geographical proximity with a patented invention are associated with the likelihood that the patent is sold, and whether the patent sold is bought by a small or large firm. To do so, we develop a dataset that matches patent sales and information on whether transacted patents are owned by small or large firms following a patent sale.