Bessen, James E.James E.BessenNeuhäusler, PeterPeterNeuhäuslerTurner, John L.John L.TurnerWilliams, JonathanJonathanWilliams2022-03-052022-03-052018https://publica.fraunhofer.de/handle/publica/25401310.1016/j.irle.2018.07.001We use detailed data to estimate the private costs and private rents of United States patents for publicly-traded firms. In analyzing costs, we first introduce a novel theoretical model to interpret our estimates. We then combine lawsuit data from Derwent Litalert with non-practicing entity (NPE) lawsuits collected by Patent Freedom, and use an event-study approach to estimate losses suffered by alleged infringers during1984-2009. To estimate rents, we combine patent data from the USPTO and EPO with financial data from COMPUSTAT, and use market-value regressions to estimate the value of patent rents for publicly-traded US firms during 1979-2002. We find that private costs exceed private rents during 1999-2000 and the trend in costs is sharply higher. Costs also exceed forecasts of rents for 2005-09. A surge in the number of NPE lawsuits contributes to the increase in the gap.enevent studymarket-value regressionPatentLitigationnon-practicing entitiesresearch and development303600journal article