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Patent Term, Innovation, and the Role of Technology Disclosure Externalities

Fabio Bertolotti

The Review of Economic Studies2026https://doi.org/10.1093/restud/rdag005article
FT50AJG 4*ABDC A*
Weight
0.50

Abstract

I examine the impact of patent term on R&D and innovation in the presence of policy anticipation, common in real-world settings. Using a difference-in-difference design, I exploit quasi-experimental variation in US patent term across technological fields due to the ratification of TRIPs agreements in 1995. Despite a general increase in average patent term, in most fields innovators faced a considerable probability of patent term reduction for future innovations. Three key findings emerge: (1) R&D and innovation accelerate more in fields with a higher probability of patent term reduction, i.e. a shorter average patent term extension, before implementation. (2) This heightened activity persists for at least 5 years postimplementation, driven by indirect effects where the news-related acceleration fosters further innovation through technological externalities linked to cumulative knowledge creation. (3) Conversely, the direct effect of a shorter extension in patent term would stimulate relatively less innovation, absent the indirect effects of anticipation.

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https://doi.org/https://doi.org/10.1093/restud/rdag005

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@article{fabio2026,
  title        = {{Patent Term, Innovation, and the Role of Technology Disclosure Externalities}},
  author       = {Fabio Bertolotti},
  journal      = {The Review of Economic Studies},
  year         = {2026},
  doi          = {https://doi.org/https://doi.org/10.1093/restud/rdag005},
}

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Patent Term, Innovation, and the Role of Technology Disclosure Externalities

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Evidence weight

0.50

Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.50 × 0.4 = 0.20
M · momentum0.50 × 0.15 = 0.07
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.