State of Innovation

Patents and Innovation Economics

National Innovation/Invention Tax

According to, the Senate has voted for fee diversion from the U.S. Patent and Trademark Office.  This reprehensible practice is has done untold damage to U.S. innovation.  The Senate’s failure to fulfill their constitutional responsibilities will help to ensure that the present economic downturn is prolonged.  As Gene Quinn explains:

The Senate vote would re-institute fee diversion, which means that if the Patent Office were to collect revenues over and above the amount allocated by Congress those additional fees would not be able to be used by the Patent Office to improve operations, or even for just handling the increased work generated by additional filings.  Rather, fees received over and above the allocated amount would be stripped from the Patent Office and diverted into the General Treasury account.  That is plain and simple a National Innovation Tax, and it is an enormously bad idea.

December 17, 2009 Posted by dbhalling | -How to, Patents | , , | Leave a Comment

What Percentage of Patents are Commercialized?

It is quite common to hear that only 2% of all patents every make money.[1]  Apparently this myth has been around for a long time, because Jacob Schmookler in his 1966 book Invention and Economic Growth, he investigates this myth.  His survey show that over 50% of patents are commercialized.[2]  He states that “prevailing opinion has proved to be in serious error.”  He found similar results in Europe, based on the percentage of five year maintenance fees paid.  He states that even “many corporate officers who doubted the accuracy of the (commercialization rates) later found that their own companies’ experience confirmed the findings.”  He notes that most people are only able to perceive giant steps in an area of technology.  As a result, most people not skilled in the art deny the novelty encompassed by the average invention.  A recent survey in China finds that 70% of patents are commercialized in China.[3]


[2] Schmookler, Jacob, Invention and Economic Growth, Harvard University Press, Cambridge, Massachusetts, 1966, p. 49. 

[3] (12/16/09).

December 17, 2009 Posted by dbhalling | Uncategorized | , , , | Leave a Comment