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Market of Ideas Research Notes (view source)
Revision as of 16:45, 27 September 2016
, 16:45, 27 September 2016no edit summary
The cost of prosecuting a patent application, inclusive of fees and legal costs, is typically estimated to be between $20,000 and $50,000, depending on the patent’s complexity. The transaction value of patents need not cover this fixed cost, even if the patent holder doesn’t commercialize the patent themselves. The aggregate revenue from a portfolio of patents should cover both the cost of prosecuting applications and the research and development cost, and provide a return on average across patent-holders. As transaction volumes increase, and as transaction costs fall with standardization of licenses, more efficient intermediaries, and generally better markets, the average transaction value will naturally decrease. An estimate of $10,000 to $100,000 per patent trade is probably reasonable.
'''Griliches Excerpt:'''
"Among the patents reported to be in current use and with relevant numerical responses and a positive gain (accounting for about 20 percent of all the relevant responses), the mean value was $577,000 per patent, but the median value was only about $25,000 (implying, under the assumption of log normality, 2.5 as the coefficient of variation and a standard deviation of about $1.5 million). If one includes all the no gain, loss, and not yet used patents, the mean gain falls to about $11 2,000, and the median is close to zero or below (computed from the tables in Sanders, Rossman, and Hams 1958, pp. 355 and 357). Even this lower mean number is quite impressive, roughly equivalent to $473,000 per average patent in 1988 prices (using the GNP deflator to convert it from 1957 prices), but so also is the associated dispersion." (Griliches 309)
Griliches, Z. (1998). Patent statistics as economic indicators: a survey.
== Patent Litigation ==
