The relationship of patenting applications and expenditure with output and real GDP in nineteenth century colonial New Zealand

Abstract

The relationship between patenting and output series and real GDP is examined using both nineteenth century New Zealand patent applications, and applications weighted by fees and compulsory advertising expenditure. Weighting patents is desirable because of the rapid growth in applications after initial fees were reduced in the early 1880s. The expenditure data usually provides a better measure of intellectual property investment, with considerably more Granger causality relationships between output and patents expenditure identified than between output and unweighted applications. Nevertheless, there were still important, and sometimes complementary, relationships between patent applications and output. Output usually led patenting, particularly using expenditure data.

KEYWORDS:

• New Zealand patents
• Granger causality
• patents expenditure
• GDP

JEL Classifications:

• O31
• N17
• N37
• N87

Acknowledgements

We would like to thank the University of Waikato Postgraduate Committee for support provided to the first author, including a Masters Research and a Masters Publication scholarship.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

1 Results for the relationships between total patent applications and expenditure with total output and GDP after adding further variables were disappointing. Although Magee found that native-born engineers were an important variable explaining patent applications in Victoria (Magee, 2000), statistics were only available for New Zealand censuses from 1886. Levels of urbanisation in New Zealand showed relatively little change, while high quality data on government expenditure is lacking.

2 About two-thirds of patent applications were by New Zealanders, but New Zealanders paid only about 45 percent of patent fees.

3 Tables showing coefficients for Granger causality are available from the authors on request.

Additional information

Funding

This work was supported by University of Waikato Masters Scholarship.