Explaining the propensity to patent computer software

Several studies have explained the propensity to patent in industrial corporations. Larger companies are supposed to have a stronger tendency to protect their intellectual property through patents. Also, patents are related to industry, with chemicals and pharmaceuticals using them more frequently, and services industries less so. In the last 20 years, the rapidly growing software industry has greatly increased its tendency to patent. This study presents a statistical explanation of patenting in the US and Canadian (over 1700) publicly quoted computer software-producing companies, representing half of the world industry. We found that firm size, geographical clustering, and the mix of software products and services at firm level explain most of the propensity to patent.