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Economists have long seen the patent system as a crucial lever through which policymakers affect the speed and nature of innovation in the economy. It is not surprising, then, that the profound changes which have roiled the global patent system over the past 20 years are attracting increasing attention from the economics profession. A critical question relates to the impact of these shifts: to what extent do they really affect the pace of innovative discovery and diffusion? Much of the theoretical economics literature, such as Richard Gilbert and Carl Shapiro 1990, has assumed an unambiguous relationship between the strength of patent protection and the rate of innovation. This assumption has been relaxed in a line of work on sequential innovation, beginning with Suzanne Scotchmer and Jerry Green 1990. This research addresses this question by examining the impact of major patent policy shifts in sixty nations over the past 150 years. I examine the changes in patent applications by residents of the nation undertaking the policy change. While I tabulate domestic filings by residents and non-residents alike, confounding factors may influence
Josh Lerner (Wed,) studied this question.