The first comprehensive textbook covering all aspects of the economics of innovation and the role of intellectual property in encouraging or discouraging innovation.

Innovation is widely viewed as the engine behind economic growth, and it has assumed increasing importance in contemporary economic research. In The Economics of Innovation and Intellectual Property, Bronwyn H. Hall and Christian Helmers introduce readers to the use of economic analysis for the understanding of technical change and the innovative process, its determinants, and consequences.

The authors cover innovation basics, the measurement of returns to innovation for individuals and the economy, and the use of intellectual property protection by innovators. They focus on the various ways patents have been used by industry to secure returns to innovation, as well as the strategic use of patents, and they emphasize present-day technologies including pharmaceuticals, software, and AI.

Clearly organized and accessible, The Economics of Innovation and Intellectual Property offers a useful introduction to economics, business, public policy, and legal studies, and provides a comprehensive collection of references and information from a variety of sources across disciplines. It also includes various boxes with definitions and examples, as well as a brief mathematical appendix explaining concepts that may be unfamiliar and an introduction to data sources.

Bronwyn H. Hall is Professor of Economics Emerita at the University of California at Berkeley, Visiting Professor at MPI-Munich, and a Research Associate at the NBER, IFS-London, and the Innovation Lab, College de France. She received the 2024 Award of the Distinguished Fellow granted by the American Economic Association. She has published numerous articles on the economics and econometrics of technical change and innovation and is the editor of the Handbook of the Economics of Innovation in the Elsevier series of economic handbooks. Her research includes analysis of the use of intellectual property systems in developed and developing countries, the valuation of intangible (knowledge) assets, comparative firm-level R&D investment and innovation studies, measuring the returns to R&D and innovation, and analysis of such technology policies as R&D subsidies and tax incentives.

Christian Helmers is Professor of Economics at the Leavey School of Business at Santa Clara University and Visiting Professor at KU Leuven. His research focuses on innovation and intellectual property. Before joining Santa Clara, he was an assistant professor at Universidad Carlos III, Madrid. Prior to that, he worked as a research economist at the London School of Economics.

List of Illustrations
Preface
Acknowledgements
How to Use This Book

I. Innovation
1: Innovation and Intellectual Property
2: What Is Innovation?
3: Supply and Demand for Innovation
4: Appropriation Mechanisms
5: Innovation and Competition in Firms
6: Returns to R&D and Innovation
7: Diffusion
8: Innovation Strategy
9: Innovation and Economic Growth
10: Innovation Policy

II: Intellectual Property Rights and Their Use
11: Patents, Utility Models, Design Rights, and Plant Breeder Rights
12: Trademarks and Brands
13: Copyright
14: Alternatives to Intellectual Property

III: The Patent System
15: Intellectual Property Rights and Economic Development
16: Patents and Pharmaceuticals
17: Software, Business Methods, Open Source, and Artificial Intelligence
18: Strategic Patenting, Patent Portfolio Races, and Patent Thickets
19: Patent Litigation and Enforcement
20: The Sharing and Exchange of Patents
21: Technology Standards and Standard Essential Patents
22: Patent Trolls

IV: Appendices
A: Mathematics and Statistics
B: List of Abbreviations
C: Data

Bibliography
Index