Per un pugno di dollari: A first look at the price elasticity of patents

Do patent filing fees vary significantly across countries and do they affect the patenting behavior of applicants within EPC member states?

Understanding the impact of patent filing fees on patenting behavior is crucial, especially given the increasing backlogs in patent offices and the variation in fees across different countries. A negative elasticity would imply that higher fees discourage patent applications, leading to suboptimal treatment of inventors in smaller countries. This insight informs policy changes necessary to optimize the filing process and improve the intellectual property landscape in the European context.

Using data from 29 European Patent Convention member states, we employed a quantitative analysis of patent filing behaviors. We gathered data on national priority filings, filing fees, and other relevant factors such as GDP per capita and the duration of EPC membership. Through ordinary least squares regression, we estimated the relationship between patent filing fees and the number of first applications in 2003.

We found that the price elasticity of priority filings is -0.45, indicating that a 10% increase in filing fees would lead to a 4.5% decrease in the number of priority applications. We also found significant variation in patent fees across member states, with smaller countries facing higher relative fees. Additionally, the transfer rate of domestic priority filings to the EPO positively correlates with GDP per capita and the duration of membership in the EPC, revealing important insights into the factors influencing international patenting behavior.

• 2003 patent filing data from 29 EPC member states, specifically national priority filings sourced from NPOs.
• GDP per capita data from the International Monetary Fund (IMF) World Economic Outlook Database.
• Data on research efforts and expert analyses from various academic sources.

• The relationship between patent filing fees and demand for patents is linear and holds across countries.
• Filing fees are an exogenous factor affecting patent application behaviors.
• The strength of intellectual property protections and reporter variables like GDP per capita influence the propensity to file patents.