Patents that match your standards: Firm-level evidence on competition, innovation and growth

Abstract: When a technology becomes the new standard, the firms that are leaders in producing this technology gain acompetitive advantage. Matching the semantic content of patents to standard documents, we show that firmscloser to the new technology standard increase their market share and sales. In addition, if they operate ina competitive market, these firms also increase their R&D expenditure. Yet, these effects are temporary sincestandardization creates a common technological basis for everyone, which allows followers to catch up andthe economy to grow.