On the measurement of patent stock as knowledge indicators

Most of the conventional indicators for measuring the amount of technological knowledge (TK) have so far been input-based indicators. Hence, there is growing need to develop output-based indicators, and accordingly some studies have been conducted thereon. However, previous research has adopted patent count or patent stock by simple count in measuring the amount of TK as output-based indicators. The principal problem with using this variable is that the value of individual patent is too heterogeneous. That is a large portion of these patent databases are either of little value or nothing at all. As a result, patent count or patent stock by simple count cannot be seen as a suitable measure of TK.In this study, we attempted to resolve the value-heterogeneity problem in measuring patent stock. The notion of citation-based patent stock (CPS) and valuation-based patent stock (VPS) is proposed in this paper and the calculation method is described in detail. In CPS, the economic value of individual patent is assumed to be proportional to the number of citations received from other patents. And in VPS, the economic value of individual patent is derived from the value distribution of patents registered in some cohort by manipulating the patent renewal data. We validated the indicators by comparing them with the usual input-based indicators and by analyzing the relationships between them and the productivity growth empirically.