An Empirical Study on the Effects of the America Invents Act on Patent Applications Owned by Small Businesses

TL;DR

This study empirically examines how the America Invents Act of 2011 differentially impacted patent application success rates for small versus large businesses, revealing a significant advantage for small-business applicants post-enactment.

Contribution

It provides the first empirical evidence of the AIA's differential effects on small and large business patent applications using a difference-in-differences analysis.

Findings

Small-business applicants were relatively favored after the AIA.

The effect of the AIA on small-business patent success was statistically significant.

The impact of the AIA was practically large for small-business applicants.

Abstract

This paper evaluates the heterogenous impacts of the America Invents Act of 2011 (AIA) on patent applications for small and large businesses. Using data collected from the United States Patent and Trademark Office and Google Patents, I compare how the probability of successfully overcoming an initial rejection is affected by the AIA for small- and large-business applicants, respectively. This comparison is achieved by analyzing the data using a difference-in-differences approach. Results suggest that after the enactment of the AIA, small-business applicants were relatively favored when compared against large-business applicants. This effect is statistically significant and also practically large.