Working Paper: NBER ID: w16323
Authors: Bronwyn H. Hall; Christian Helmers
Abstract: Global climate change mitigation will require the development and diffusion of a large number and variety of new technologies. How will patent protection affect this process? In this paper we first review the evidence on the role of patents for innovation and international technology transfer in general. The literature suggests that patent protection in a host country encourages technology transfer to that country but that its impact on innovation and development is much more ambiguous. We then discuss the implications of these findings and other technology-specific evidence for the diffusion of climate change-related technologies. We conclude that the "double externality" problem, that is the presence of both environmental and knowledge externalities, implies that patent protection may not be the optimal instrument for encouraging innovation in this area, especially given the range and variety of green technologies as well as the need for local adaptation of technologies.
Keywords: Patent Protection; Technology Transfer; Climate Change; Innovation
JEL Codes: O19; O33; O34; Q54; Q55; Q58
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| stronger patent protection in a host country (O34) | encourages technology transfer through imports of capital goods, foreign direct investment, and licensing (O24) |
| stronger patent protection (O34) | level of manufacturing imports (L60) |
| stronger patent protection (O34) | stimulates domestic innovation activities (O31) |
| stronger patent protection (O34) | inhibits learning through imitation (D83) |
| stronger IPRs (O34) | facilitate technology transfer in middle-income countries with innovative capacity (O39) |
| patent protection alone (O34) | may not suffice to promote innovation in the context of climate change (O35) |