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7.Allen, “Collective Invention”; Allen, British Industrial Revolution; Allen, “Industrial Revolution in Miniature”; Nuvolari, “Collective Invention during the British Industrial Revolution”; Nuvolari and Verspagen, “Lean’s Engine Reporter”; MacLeod, Inventing the Industrial Revolution, pp..104–105.
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8.Bessen and Nuvolari, “Di.using New Technology”; Mak and Walton, “Steamboats”; McGaw, Most Wonderful Machine; Temin, Iron and Steel; Meyer, “Episodes of Collective Invention”; Thomson, Structures of Change; Wallace, Rockdale.
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9.Allen,British Industrial Revolution, pp.68–74; Olmstead and Rhode, CreatingAbundance.
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10.VonHippel, “Cooperation between Rivals”; Schrader, “Informal Technology Transfer”; West, “Commercializing Open Science”; Meyer, “Episodes of Collective Invention”; Von Hippel, Democratic Innovation.
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11.Wallace, Rockdale.
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12.Fritz, Autobiography of John Fritz, p.160.
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13.Stephen Wozniak, “Home brew and How the Apple Came to Be,” http://www.atariarchives.org/deli/homebrew_and_how_the_apple.php.
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14.West, “Commercializing Open Science.”
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15.Scotchmer, Innovation and Incentives.
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16.Patents are not the only means of preventing imitation.Aside from the pharmaceutical and chemical industries, most firms use other means (Levin et al., “Appropriating the Returns”).By being first to market with an innovation, they earn pro.ts before rivals can enter.Other times they can gain an advantage through learning by doing: they can maintain a cost advantage relative to rivals with less experience.And big companies often earn pro.ts on complementary products.For example, computer companies once earned pro.ts on the hardware even though the software was copied.Although firms often use alternative means to limit imitation, copying is still seen as the central concern: if imitation hurts pro.ts, it will reduce innovation incentives.
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17.Much of the historical material in this chapter is based on Bessen and Nuvolari, “Di.using New Technology” and “Knowledge Sharing.”
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18.Gilroy,Art of Weaving, p..416.John Ramsbottom and Richard Holt patented a version in 1834.in England, but they did not patent it in the United States, perhaps because of Gilroy’s prior art.
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19.Meyer, Networked Machinists; Thomson, Structures of Change.
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20.Wallace, Rockdale, p.216.
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1704380859
21.Zevin, “Growth of Cotton Textile Production.”
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22.The value of a patent is de.ned as including the value of selling the patent to another party, who will obtain value by excluding rivals from the market.
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23.The Boston Manufacturing Company did have difficulty enforcing its patents for the double speeder (a machine used for winding cotton prior to spinning), in part because of faulty drafting of the patent.However, the power loom was the key invention, and it appears that the BMC had no difficulty getting $15 per loom for a patent license or $35 gross pro.t on manufactured looms through 1823.The persistence of this royalty through 1823 suggests that the BMC did not experience significant price competition from Rhode Island mechanics using other designs, including Gilmour’s.Moreover, the patent royalty of $15 compares reasonably well with the $25 royalty that the powerful sewing machine patent pool was able to charge on a comparably priced piece of equipment.
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24.Draper patented this device in 1816 and he obtained a patent on an improved version in 1829.In 1830, Draper’s successor licensed the patent and also sold his own manufactured version for $2.By comparison, the loom temple saved cloth manufacturers about $35 each year on each loom in labor costs.As with the power loom, patents captured less than 1 percent of the value created.In a highly competitive market for textiles, a manufacturer without the least costly technology would lose money.Under these conditions, the independent inventor with sole rights to that technology has all the bargaining power and can demand full value.But when competition between the manufacturers was soft, independent inventors did not have as much bargaining power, and bargaining was more along the lines of what economists call a bilateral monopoly.
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25.Bessen, “More Machines.” The three minutes saved was from the loom temple, for which there were many designs, not all of them patented.Even ignoring the initial power loom invention, the reduction in labor time was about eight minutes per yard, so the majority of the reduction was still from unpatented improvements.
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26.Lemley, “Myth of the Sole Inventor.”
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27.Merton, “Singletons and Multiples.”
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28.Mokyr, Gifts of Athena, p..101.There are other explanations.For example, common innovations might arise from sharp changes in consumer demand or in the availability of general purpose technologies.
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29.For example, Edwin Mansfield, “Technical Change,” studied twelve innovations and only one of them was adopted by most of the firms in less than a decade.
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30.See Bessen and Nuvolari, “Di.using New Technology.”
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31.Darby and Zucker, “Change or Die”; Darby, Zucker, and Welch, “Going Public”; Zucker, Darby, and Armstrong, “Geographically Localized Knowledge”; Zucker, Darby, and Armstrong, “Commercializing Knowledge”; Zucker, Darby, and Brewer, “Intellectual Human Capital.”
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