Exploring the Tail of Patented Invention Value Distributions

We explore the tail of patented invention value distributions by using value estimates obtained directly from patent holders. The paper focuses on those full-term German patents of the application year 1977 which were held by West German and U.S. residents. The most valuable patents in our data account for a large fraction of the cumulative value over all observations. Several tests are conducted to pin down more precisely the nature of the high-value tail distribution. Among the Pareto, Singh-Maddala and log normal distributions, the log normal appears to provide the best fit to our patented invention value data.

Harhoff, Dietmar, K. Vopel and Frederic M. Scherer (1997), Exploring the Tail of Patented Invention Value Distributions, ZEW Discussion Paper No. 97-30, Mannheim.