Reverse causality in the R&D – patents relationship: an interpretation of the innovation persistence

Starting from the failure of the R&D-patents traditional relationship, when time-series and/or within industry dimensions are included in the empirical analysis, the present work tries to contribute to the empirical literature in two directions. Firstly, it perform a Granger causality test on the theoretical presumption of a reverse patents→R&D link as an explanation of the failure of the traditional relationship. Second, assuming the reverse patents-R&D causality, we test and interpret the lag structure of such a relationship as showing the effective patent life which firms expect in the two Schumpeterian patterns of innovations they belong to. To the light of the effective patent life, we offer a further explanation of innovation persistence which overturns the findings of the existing literature on persistence.