Analysis of propensity to patent and science-dependence of large Japanese manufacturers of electrical machinery

Summary The paper aims to clarify the extent to which the results of scientific-oriented research conducted by corporations are reflected in their application-oriented research. Focusing on large Japanese manufacturers of electrical machinery, the paper analyses firm-level data on presentations of scientific papers that represent the results of scientific-oriented research activities, citations of scientific papers in patents, and inventions. The electrical machinery industry, a prototypical science-based industry, has been placing a growing emphasis on scientific-oriented research during the 1990's as is evident from trends in R&D expenses, scientific papers, and inventions. Regression analysis results suggest a complementary relationship between citations of basic scientific knowledge as presented in scientific papers on the one hand and acts of invention on the other hand, in the sense that a rise in citations corresponds to a rise in inventions. Moreover, the results suggest that invention efficiency (number of patent claims per unit of R&D expenditure) has been increasing during the 1990's. Furthermore, the results suggest that, given the exogenous influences on the patent system in Japan, it is necessary to include the number of patent claims when attempting to measure corporate technology development activity through the volume of patent applications. However, there was no finding of a clear relationship between the number of scientific papers and inventions. Implications of these results for corporate R&D strategy are examined.