DO PATENT POOLS ENCOURAGE INNOVATION? EVIDENCE ...

a mean of 1.93 cited patents per subclass with pool patents this implies a decline
in patenting of 9 percent.
An additional robustness check repeats our main specifications as Poisson
regressions to control for the count data characteristics of patent data. Fixedeffects
Poisson estimates imply that subclasses with one additional pool patent
produced 10 percent fewer patents after the pool formed (exp(-0.098)-1=-0.10,
significant at 1 percent, Table 8, column 2). 16
A final robustness check drops individual industries from the sample.
Specifically, we estimate equation (1) 20 times, each time excluding one pool
from the sample. Dropping aircraft instruments and variable condensers yields to
the largest declines in estimated effects, but estimates remain large and
statistically significant. Without aircraft instruments the estimated decline is -
0.38 (instead of -0.45) patents per subclass and year; without variable condensers
the estimated decline is -0.42 patents per subclass and year (significant at 1
percent, Table 9). In regressions that drop any other industry from the sample, the
estimated decline in patenting remains larger than -0.38.
IV. CORRELATION WITH POOL CHARACTERISTICS
Was the decline in patenting stronger for larger pools or for pools that
were less likely to license their technologies to outside firms This section
presents descriptive evidence on the correlation between the decline in patenting
and the characteristics of individual pools
16 To calculate robust standard errors for Poisson regressions with subclass and year fixed effects
we use STATA’s “xtpqml” coded by Tim Simcoe, based on Wooldridge (1999).
20