New Data on the Use of Patents by Universities, Small Firms and Individual Inventors
3. Nonproﬁt patents (including universities) The database of USPTO small entities does not contain a ﬁeld which helps us to distinguish between Small Firms and Nonproﬁt organisations. The identiﬁcation and separation of commercial ﬁrms from assignees whose central motivation is research for educational, charitable or humanitarian purposes can only be achieved by examination of the individual records. In the process, a distinction needs to be made about the precise conditions necessary for Nonproﬁt status. The US Ofﬁce of Management and Budget provides a working deﬁnition1 of the term ‘Nonproﬁt’; it bestows this status on any organisation engaged in an activity ‘primarily in the public interest’. Of course, deﬁning what is and what is not in the public interest is frequently complex. In this analysis, we have interpreted the deﬁnition broadly to mean that a ‘not for proﬁt’ or ‘Nonproﬁt’ organisation is one where the primary beneﬁciary of the organisation’s activities is not a private shareholder; it is not organised primarily for proﬁt. A proﬁt-making ﬁrm is expected to act in the ﬁnancial interests of its shareholders or investors; and its research and development activities, while crucial to its own innovation and whose spillovers contribute to general economic growth, are directed towards that end. It is a feature of Nonproﬁt organisations that any returns from inventions are, in general, recycled to further the research activities of the organisation. This distinction has become complicated by the fact...
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