Patent eligibility after Alice: Evidence from USPTO patent examination

In a series of decisions over the last decade, the Supreme Court of the United States altered the classes of inventions that are eligible for patent protection—a body of law called subject matter eligibility. One of the more contentious of these decisions, Alice Corp. versus CLS Bank International (Alice), questioned the patentability of a broad class of inventions involving abstract ideas, particularly in digital technologies. Exploiting a quasinatural experiment, we find that the Alice decision reduced favorable patent eligibility decisions by 31% and significantly and persistently increased legal uncertainty in patent examination by 26% for a broad set of technologies. Our analysis quantifies how legal decisions can limit patent protection and highlights the need for further research on how greater legal uncertainty affects upstream investments supporting invention and downstream innovations fueling growth.