The Scope of Software Patent Protection in the Digital Age: Evidence from Alice.

The article focuses on the impact of narrowing the scope of software patent protection on software firms, particularly following the 2014 U.S. Supreme Court ruling in Alice Corporation v. CLS Bank International. Using data from 2010 to 2018 and a difference-in-differences research design, the study finds that a reduced scope of software patent protection is associated with increased open-source activities and higher sales among software firms. The research also shows that firms with a higher pre-existing stock of software patents respond more strongly by expanding open-source engagement, while the increase in sales is observed broadly across firms. These findings suggest that limiting software patent scope may foster innovation strategies that balance proprietary rights with open collaboration, offering implications for patent policy in software and related digital technologies such as artificial intelligence and blockchain.