Antitrust environment and innovation

Summary

This paper examines the relationship between the antitrust environment and innovation in the US economy, where innovation is measured by patent activity. The hypothesis to be tested is whether antitrust enforcement activity, as measured by the number of civil filings of the US Department of Justice, has had a significant impact on the level of innovation in the US economy, after adjusting for other factors that have an impact on innovation, such as research and development expenditures and real economic growth.  Impacts of civil antitrust case filings, criminal antitrust case filings and total US Department of Justice antitrust case filings on patent activity in the USA are estimated for the period 1953-2000. The empirical results show that civil case filings have a statistically significant impact on innovation.