Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/295746 
Year of Publication: 
2024
Series/Report no.: 
DICE Discussion Paper No. 414
Publisher: 
Heinrich Heine University Düsseldorf, Düsseldorf Institute for Competition Economics (DICE), Düsseldorf
Abstract: 
We study the effect of stronger patent protection on innovation activities of firms and firm-product level markups. Relying on cross-industry differences in the use of patents, we exploit firm-level variation in exposure to India's patent reform. For firms more exposed to stronger patent protection, we find an increase in patenting and R&D expenditure post-reform. Additionally, we estimate an increase in firm-product level markups after the reform, driven primarily by lower marginal costs rather than higher prices. Our results indicate that process innovations and output expansion contributed to these cost-savings, and incomplete pass-through accounts for a substantial part of rising markups.
Subjects: 
Intellectual property rights
patent protection
innovation
R&D
markups
patents
JEL: 
L10
O30
O31
O00
D22
ISBN: 
978-3-86304-413-8
Document Type: 
Working Paper

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