Combining Patent Law Expertise with R&D for Patenting Performance

Abstract

Drawing on the resource-based view (RBV), this paper examines how the combination or bundling of resources influences firm-patenting performance. We hypothesize that firm-patenting output depends not only on research and development (R&D) resources, but also on the patent law expertise combined with R&D inside the firm. We predict that the specialization of this in-house legal resource to R&D enables firms to identify patentable inventions more effectively and to convert them into patents. We also argue that there may be a positive complementary relationship between patent law expertise and R&D, such that patent law expertise will have a larger effect on patent output when it is deployed with matching higher levels of R&D. Furthermore, we predict that the effect of internal patent law expertise on firm patenting will be moderated by organization- and industry-level contextual factors. To test our hypotheses, we examine the patenting performance of a sample of Fortune 500 firms from 1990 to 2000. Results suggest that in-house patent law expertise is a significant predictor of firm-patenting performance; furthermore, this effect is moderated by the firm's level of top management team (TMT) patent law background and industry-patenting pressures. However, our hypothesis of a complementary relationship between patent law expertise and R&D was not supported; instead, we found evidence of a counterintuitive (weak) negative interaction between these two variables. Our findings shed light on how the combination of other resources with R&D affects firm-patenting performance, and advance the integration of complementary organizational perspectives with the RBV.