Collaborative knowledge exchange promotes innovation

TL;DR

This paper provides micro-level evidence that collaborative patent development involving inventors with diverse knowledge bases leads to more innovative patents, measured by the novelty of exchanged knowledge.

Contribution

It introduces a novel micro-level analysis linking inventor knowledge differentiation to patent novelty, using word pairs in abstracts as a proxy for knowledge.

Findings

Higher knowledge differentiation among collaborators increases patent novelty.

Inventors' prior participation in patents influences their knowledge base.

Knowledge exchange enhances innovation in collaborative patenting.

Abstract

Considering collaborative patent development, we provide micro-level evidence for innovation through exchanges of differentiated knowledge. Knowledge embodied in a patent is proxied by word pairs appearing in its abstract, while novelty is measured by the frequency with which these word pairs have appeared in past patents. Inventors are assumed to possess the knowledge associated with patents in which they have previously participated. We find that collaboration by inventors with more mutually differentiated knowledge sets is likely to result in patents with higher novelty.