Knowledge technological proximity: evidence from US and European patents

Abstract

The purpose of this paper is to explore the correlation between the technological proximity measures in three areas: USA, Japan and the Europe. In each economic area, we use information from two international patent systems to construct the technological proximity for 240 large international firms. In particular, we select firms’ patents from United States Patent and Trademarks Office data and European Patent Office data. In order to compute the technological proximity, we follow the methodology developed by Jaffe [1986. “Technological Opportunity and Spillovers of R&D: Evidence from Firms’ Patents, Profits and Market Value.” American Economic Review 76 (5): 984–1001], where a technological vector is based on the distribution of patents of each firm across technology classes. Since the Jaffe distance assumes that spillovers only occur within the same technology class, but rules out spillovers between different classes, we develop also a distance measure which exploits the Mahalanobis norm to identify the distance between different technology classes based on the frequency that patents are taken out in different classes by the same firm. The contribution to the existing literature is to investigate the robustness of the technological proximity measure and the extent to which it may be affected by patent system features.

Keywords:

• innovation
• patents
• technological proximity

JEL Classification:

• O31
• O33
• O34

Notes

We use the updated patent data (1975–2002) downloading from Hall's website: www.econ.berkeley.edu/ bhhall/patents.html

European economic group considers the following countries: Belgium, Denmark, Finland, France, Germany, Italy, the Netherlands, Sweden and the UK.

See Maraut et al. (2008) for the methodology used for the construction of REGPAT. Please contact [email protected] to download REGPAT database.

See Griliches (1992), Mohnen (1996) or Cincera and van Pottelsberghe de la Potterie (2001) for a review of different proximity measures used in the literature.

See Bar and Leiponen (2012) for a new and no-standard measure of technological distance.

See Appendix 1 for the classification of USPTO patent classes into 36 two-digit technological categories.

See Appendix 2 for the classification of EPO patent classes into 50 two-digit technological categories.