Patent data provide useful indicators for measuring technical change and inventive input and output over time (see Griliches 1990). Further, U.S. patenting by foreign inventors enables measurement of the levels of invention in those foreign countries (Pavitt 1985) and can serve as a leading indicator of new technological competition (Faust 1984). (Click here for footnote 27.) Patent statistics trends can therefore serve as an indicator--albeit one with certain limitations--of national inventive activities. (Click here for footnote 28.)

This section describes broad trends of patent activity in the United States over time, by field, and by industry by both U.S. and foreign inventors. It discusses patenting trends in foreign countries and presents new data on international patenting trends in "critical" technologies.

• Incompleteness--many inventions are not patented at all, in part because laws in some States already provide for the protection of industrial trade secrets.

• Inconsistency across industries--industries vary considerably in their propensity to patent inventions; consequently, it is not advisable to compare patenting rates between different technologies or industries.

• Inconsistency in quality--the inventions patented can vary considerably in quality. (Patent citation rates are one method for dealing with this question of varying quality.)

  Despite these and other limitations, patents provide a unique and convenient source of information on inventive activities.

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