Knowledge flows through patent collaborations: The effect of regional trade agreements. An empirical approach

This thesis analyzes the effect of regional trade agreements (RTAs) on international patent collaborations, as a measure of knowledge flows. Patent collaboration generate knowledge flows between inventors through interactions and learning opportunities. By the use of the European Patent Office’s Patstat database on patent applications and the gravity dataset from the french research institute CEPII, I estimate the effect of RTAs on international patent collaboration between inventors. The panel consists of 209 countries over the time period 1965 - 2006. The amount of patent collaboration between inventors residing in different countries will be estimated using the gravity model, which is a highly successful empirical model. Within my work, I extend the gravity equation with the outcome of international patent collaborations, as a measure of knowledge flow. Furthermore, I estimate this equation using OLS and Poisson regressions with country- year specific fixed effects. To secure robustness, I use different estimation methods and subsamples of the data. I also investigate the effect of high- and low- income countries as well as the North American Free Trade Agreement (NAFTA) on international patent collaboration. From this, my findings suggest, positive, significant and robust effect of RTA on knowledge flow, measured by international patent collaboration. In particular, I find that joining a RTA increase international patent collaboration by 55%. Patent collaboration is also positively affected by the presence of a common language, a common border, colonial link and a common legal origin. While being negatively affected by distance. Additionally, I find that the effects are larger when RTAs include stronger rules for intellectual property rights. In total, the estimated effects on international patent collaborations are similar to the effects characterizing international trade, within the gravity framework