Playing in between: patent brokers in markets for technology

Abstract

Here we argue that patent brokers do not only stay in between supply and demand of innovation, but play in between executing complex transactions and taking entrepreneurial risk. In doing so, they serve a support function to R&D managers of firms adopting various approaches to technological change. We discuss how economic and sociological theories explain brokerage and its existence. Our qualitative analysis of the current practice of patent brokerage in the United States finds some evidence in support of such arguments, and moreover helps us reach a taxonomy of brokerage. We conclude with our own proposition, suggesting that even in very dense environments, the bridging role of intellectual property intermediaries is that of market makers, who leverage their specific investment to play in between technology demand and supply.