Patents in Theory and Practice: Empirical Results from Switzerland

The purpose of this paper is to investigate empirically the effectiveness of alternative mechanisms of protecting the competitive advantages of new or improved products and processes. The analysis is based on I survey I conducted among 358 firms in 127 different (four-digit) industries in Switzerland. The main results can be summarized as follows: 1) For process innovations lead time, and for product innovations, superior sales and service efforts are viewed as the most effective means of appropriation. 2)For both product and process innovations, patents are the least effective means of appropriation. In general, patents are viewed by R&D managers as an effective means of protecting the competitive advantages of new technolgy in the chemical, including the drug industries, in the synthetics and in some cases of the machinery and metal processing industries. In all other industries surveyed they are considered less affective. 3)Finally, the ability of competitors to "invent around" is seen as the most important constraint on the effectiveness of patents.