Puerto Rico faces declining trend of innovation and patent applications

by | Sep 12, 2016 | Headlines, Qué Invento | Comments

By now, it is widely known that Puerto Rico has been facing an economic recession since 2006, before the US Great Recession began in 2008. Taking these conditions into account, we wanted to determine whether this influenced or affected the US territory’s technological output, by taking a look at patent applications per year, with at least one inventor in Puerto Rico. There are several scholarly articles outlining research focused on the relation between patents and economic activity, and this case can provide an interesting scenario to study.

Using the United States Patent & Trademark Office’s Patent Application Full Text & Image Database, we searched for applications filed every year since 2001 (the earliest year for which there is complete data) to 2015, and with an inventor in Puerto Rico. Applications were our selected metric because they provide a clearer picture of innovative activity rather than granted patents, which are subject to other conditions. In addition, we chose to focus on inventors in Puerto Rico instead of applicants, since we realized inventors may not always use local firms to file their applications, and some work in interstate teams, which can affect the location listed in the application.

Having gathered the data, we noticed a trend that shows a clear reduction over time, albeit with variations that seem to coincide with economic conditions.

For instance, from 2001 to 2005, there was a sharp increase in applications which suddenly dropped in 2006, right as the recession began in Puerto Rico. The number of applications stabilized until 2011, and then went up in 2012, after Puerto Rico’s economy registered growth for the first time since the beginning of the recession.

However, just as the economy started reflecting contraction, so did the number of patent applications with inventors in Puerto Rico. Every year since 2012, there has been a reduction in applications, and while we only have partial data for 2015 (given that applications are only published 18 months after they’re filed, which is the same reason we didn’t include 2016 applications), we believe the trend is clear enough to see a correlation between the economic conditions of Puerto Rico, and the amount of patent applications filed with residents of the territory listed as inventors.

Because of the stipulations for publications of patents, the data on applications cannot be used for short term projections or analysis. That said, it can provide historical insight into the conditions of the technological and innovative sectors of the territory and whether they are a symptom, a cause or merely an indicator of economic conditions. As we dive deeper into the data, we can look at comparing Puerto Rico to individual US states with both good and bad economic conditions, similar GPS, and comparable situations over time.

Ideally, this additional perspective and context can provide hints and guidance as to steps Puerto Rico could put in place to encourage and foster the economic development it so desperately needs to leave this economic crisis behind.