The Impact of the Patent System on the Timing of Technology Licensing in China: Theory and Evidence from Patent Disclosure and Grant Delays

AbstractHighlights •The patent system affects the timing decision of technology licensing through the functions of patent disclosure and patent grant•Patent disclosure delay and patent grant delay have heterogeneous effects on the different timing decisions of technology licensing in the context of a patent system that separates patent disclosure and patent grant events•The impact of the patent system on the timing of technology licensing is different between developed countries and developing countries such as China•Empirical research on large-scale sample data of 32,919 first-time licensed Chinese invention patents from 2001 to 2015 obtains a more robust conclusion AbstractThis paper explores the effects of two functions of the patent system–patent disclosure and patent granting–on the timing of technology licensing in China. We find that patent disclosure delay positively affects the licensing probability before the disclosure date and negatively affects the licensing probability between the patent disclosure date and the grant date, and it has an inverted U-shaped relationship with the licensing probability after the grant date. In contrast, patent grant delay positively affects the licensing probability between the patent disclosure date and the grant date and negatively affects the licensing probability after the grant date.