Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/146779
Authors: 
Crass, Dirk
Garcia Valero, Francisco
Pitton, Francesco
Rammer, Christian
Year of Publication: 
2016
Series/Report no.: 
ZEW Discussion Papers 16-061
Abstract: 
This paper tests a number of hypotheses on the use and effectiveness of patents and trade secrets designed to protect innovation. While previous studies have often considered patents and trade secrets as substitutes for one another, we investigate the complementary role of the two protection methods. We identify protection strategies for single innovation firms and hence overcome the assignment problem of existing empirical studies, i.e. whether firms using both protection methods do so for the same innovation or for different innovations. Employing firm panel data from Germany, we find fairly few differences between the determinants for choosing secrecy and patenting. Single innovators that combine both strategies, 39% of the group, tend to aim at a higher level of innovation and act in a more uncertain technological environment. Firms combining both protection methods yield significantly higher sales with new-to-market innovations. Using only secrecy has slightly stronger positive impacts on firm profitability.
Subjects: 
Patents
Trade Secrets
Performance Impacts
Single Innovation
JEL: 
O31
O32
O34
Document Type: 
Working Paper

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