Markus Nagler, Monika Schnitzer, Martin Watzinger, 08 February 2021

The secular decline in productivity growth is blamed by some on the slow diffusion of new general purpose technologies, so it is important to understand what slows down this diffusion and how it can be speeded up. This column presents evidence from the diffusion of the transistor, one of the most important general purpose technologies of our time. It shows that patents on general purpose technologies are likely to cause considerably more harm than patents on other technologies unless a standardised licensing regime is put in place. Not only do they block more follow-on innovation, but in particular they block valuable follow-on innovation arising from cross-technology spillovers. 

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