The Role of Fees in Patent Systems: Theory and Evidence

This paper reviews the economic literature on the role of fees in patent systems. Two main research questions are usually addressed: the impact of patent fees on the behavior of applicants and the question of optimal fees. Studies in the former group confirm that a range of fees affect the behavior of applicants and suggest that a patent is an inelastic good. Studies in the latter group provide grounds for both low and high application (or pre-grant) fees and renewal (or post-grant) fees, depending on the structural context and on the policy objectives. The paper also presents new stylized facts on patent fees of thirty patent offices worldwide. It is shown that application fees are generally lower than renewal fees, and renewal fees increase more than proportionally with patent age (to the notable exception of Switzerland and the U.S.).