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We are grateful to the late Kenneth Sokoloff for sharing with us his wisdom on the economics of invention. He has been the source of our inspiration on the subject matter. We have also benefited from comments offered by Leah Brooks, Jenifer Hunt, B. Zorina Khan, Naomi Lamoreaux, Mary MacKinnon, Daniel Parent and Jean-Laurent Rosenthal, as well as seminar participants at McGill and Toronto. We would like to thank Lingni Boon, Margaret Gales, Murlinda Kachuri, Mari-Ann Larsen-Volay and William Oman for their research assistance, as well as Yun Xia for his programming assistance in the CIPO data collection. Sutthiphisal acknowledges financial supports from Fonds québécois de la recherche sur la société et la culture (FQRSC) and the Social Sciences and Humanities Research Council of Canada (SSHRC). The views expressed herein are those of the author(s) and do not necessarily reflect the views of the National Bureau of Economic Research.NBER working papers are circulated for discussion and comment purposes. They have not been peerreviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications.© 2009 by Shih-tse Lo and Dhanoos Sutthiphisal. All rights reserved. Short sections of text, not to exceed two paragraphs, may be quoted without explicit permission provided that full credit, including © notice, is given to the source. ABSTRACT A switch to a first-to-file patent regime from its first-to-invent system has become imminent for the U.S. To learn about probable effects of such a policy change, we examine a similar switch that occurred in Canada in 1989. We find that the switch failed to stimulate Canadian R&D efforts. Nor did it have any effects on overall patenting. However, the reforms had a small adverse effect on domestic-oriented industries and skewed the ownership structure of patented inventions towards large corporations, away from independent inventors and small businesses. These findings challenge the merits of adopting a first-to-file patent regime.

Scholars have long noted the significant impact of general purpose technologies (GPTs) on the economy. However, limited attention has been paid to exploring how they are employed to generate inventions in downstream sectors (crossover inventions), and what factors may facilitate such diffusion. In a study of the introduction of electrical technology in the late-nineteenth-century United States, we find that knowledge spillovers between industries had little influence on the geography of crossover inventions as well as the speed and productivity of crossover inventors. Instead, human capital and an environment promoting inventions in general were more important.

, and participants at the BHC, CEA Meetings, CNEH Conference, NBER Summer Institute, McGill, and UCLA. We would like to thank Carolina Corral and Jinyuan He for their excellent research assistance. Finally, Sutthiphisal acknowledges financial support from Fonds québécois de la recherche sur la société et la culture (FQRSC). The views expressed herein are those of the author(s) and do not necessarily reflect the views of the National Bureau of Economic Research. NBER working papers are circulated for discussion and comment purposes. They have not been peerreviewed or been subject to the review by the NBER Board of Directors that accompanies official NBER publications.

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