Innovation and Entrepreneurship : A First Look at the Linkage Data of Japanese Patent and Enterprise Census

This paper presents the results of a comprehensive analysis of the innovation activities of the entire population of Japanese firms with the use of a linked dataset from the Establishment and Enterprise Census and the Institute of Intellectual Property Patent Database (Japan Patent Office patent application data). In 2006, approximately 1.4% of approximately 4.5 million firms filed for patents, and substantial patenting activities were observed not only in the manufacturing field but also in other sectors, such as business-to-business services and finance. In addition, firm survival and growth are regressed with patenting and open innovation (measured by the joint patent application with other firms and universities). Results show that innovation activities measured by patenting are positively correlated with firm performance. Furthermore, the relationship between patenting and survival rate is strong for large firms, whereas that between patenting and firm growth is strong for small firms.