# Valuation of patents in emerging economies: a renewal model-based study of Indian patents

**Authors:** Mohd Shadab Danish, Pritam Ranjan, Ruchi Sharma  
**arXiv:** [2208.06157](https://arxiv.org/abs/2208.06157)  
**Date:** 2022-08-12  
**Summary page:** https://www.summarizepaper.com/en/paper/2208.06157v1/

## Key points

- Study explores private value of patents in India based on patent renewal information
- Aims to estimate economic reward for inventors through making, using, or selling their inventions
- Empirical analysis focuses on 555 patents filed between 1999 and 2002
- Researchers employ an ordered probit model to understand factors influencing patent renewal decisions
- Explanatory variables considered include patent family size, technological scope, number of inventors, and grant lag
- Significant number of patents expire early, leaving only a few with high value
- Certain technology class patents enjoy higher valuation compared to others
- Provides insights into private value of patents in emerging economies like India
- Can inform policymakers and inventors when making strategic decisions regarding intellectual property rights.

## Summary

This study, titled "Valuation of patents in emerging economies: a renewal model-based study of Indian patents," explores the private value of patents in India based on patent renewal information. The researchers aim to estimate the economic reward that inventors extract from their patents through making, using, or selling their inventions. They measure this value, known as the private value of a patent, from the perspective of the patentee. The empirical analysis conducted in this study focuses on 555 patents filed between 1999 and 2002. These patents either expired in 2018 or lapsed due to non-payment of renewal fees. To understand the factors influencing patent renewal decisions, the researchers employ an ordered probit model where the renewal fee increases with the age of the patent. They also consider various explanatory variables such as patent family size, technological scope, number of inventors, and grant lag. By combining data on patentee renewal decisions with information about patent characteristics and renewal costs, this paper aims to estimate the initial distribution of rents associated with these patents. The findings reveal that a significant number of patents expire at an early stage, leaving only a few patents with high value. This aligns with previous studies conducted using European, American, and Chinese data. Furthermore, it is observed that certain technology class patents enjoy higher valuation compared to others. This suggests that specific technological domains are more lucrative for inventors in terms of extracting economic rewards from their patented inventions. Overall, this study provides valuable insights into the private value of patents in emerging economies like India by analyzing patent renewal patterns and considering various factors that influence these decisions. Understanding how different technologies and ownership statuses impact patent valuation can inform policymakers and inventors alike when making strategic decisions regarding intellectual property rights.