Gauri Subramani on Gender and Resource Inequality in Innovation

In this episode of Lehigh University’s College of Business ilLUminate podcast, we are speaking with Gauri Subramani about her research looking at the underrepresentation of women in the United States patent application process and what that means for women in innovation.

Subramani is an assistant professor of management at Lehigh's College of Business, and studies the implications of representation on entrepreneurship and innovation. Prior to entering academia, she worked as a consultant and as a political appointee in the U.S. Department of Treasury's Office of Economic Policy during the Obama administration.

She spoke with Jack Croft, host of the ilLUminate podcast. Listen to the podcast here and subscribe and download Lehigh Business on Apple Podcasts or wherever you get your podcasts.

Below is an edited excerpt from that conversation. Read the complete podcast transcript. 

For more information, including videos and articles about her work, visit Gauri Subramani’s personal website.

Jack Croft: When talking about the gender gap in innovation, the underrepresentation of women is pretty clearly illustrated by what should be a shocking and staggering statistic. Roughly 86% of all patent applications are submitted by men or by all-male teams. Research that you and your co-authors have conducted shows that the huge gender gap in the total number of patent applications actually gets worse as the patent approval process runs its course through granted patents.

So what happens to the applications that are submitted by women? And what accounts for the much higher attrition rate for patent applications submitted by women compared to men?

Gauri Subramani: One thing I just want to note is we look at the sample of applications from people in the United States and regular patent applications. So that's the sample for which that 86% is true. What we find is that applications from women and from teams that include more women are far less likely to convert to granted patents. And this isn't necessarily itself a new finding. But what we examine in our research is really why this is happening. So one key feature of the patent process, and this is also true of innovation and entrepreneurship more broadly, is that it's highly iterative.

Rejection is really a feature of the process. More than 80% of applications receive a rejection in the patent process, but that rejection isn't final. You have the ability to follow up on it and respond to it and then continue on in the patent process. But what we find in this work is that female patent applicants are less likely to follow up after they receive a rejection and that that's a major driver of this differential rate of conversion of applications to granted patents.

Croft: Do you have information on why that's happening?

Subramani: We dive into this by looking at the other features of patent applications. One of the things we take advantage of is looking at whether applications use attorneys or are affiliated with firms. That's a way that you can measure access to resources and information in some sense. So we look at how that drives this differential. It's hard to exactly nail down what's going on because that's unobserved in this process, right? We see how applications go through the process, but we don't necessarily see why they don't. But what we really measure is basically this differential responsiveness to rejection.

Croft: You had mentioned institutional support as one of the keys to successful patent applications. How does that play into this underrepresentation of women in the patent process?

Subramani: This can be really key for a few reasons. And I want to explain what it means to use an attorney or be affiliated with a firm. If you're an employee at a company and you come up with a patentable innovation, usually, this happens in the course of work. It's generally in your employment contract that the organization will own the rights to the patent. So you work at Apple. You come up with a new idea—maybe it's for work itself—and then Apple's affiliated with the patent application.

When firms are affiliated with these applications, they generally manage the whole process. Many firms, especially larger firms, have patent committees. And that committee, which is made up of a bunch of experts within the firm, determines which ideas to actually apply for patents on. And then they'll pay for the services of an attorney. Patent attorneys themselves are specialized experts. Sometimes, there are attorneys that work within firms. But generally speaking, firms will use attorneys from law firms who are patent attorneys. And patent attorneys are specialized experts. They have to pass a registration exam that's administered by the U.S. Patent Office before they can represent patent applications. So they know a lot about the patent process and how to strategically craft an application, as well as to manage communications with patent examiners.

I mentioned these rejections before and that you have to respond to them. These people are really practiced at how to write a response to a rejection, for example. So what we find, perhaps unsurprisingly, is that both men and women who have institutional support, either in the form of an attorney or by having their application be affiliated with a firm, are more successful than these unaffiliated applicants. This access to information and the financial resources of paying for an attorney can be very helpful. But what we see, interestingly, is that female applicants benefit more from the use of an attorney and firm affiliation than male applicants.

So this is a bigger benefit for female patenters. We can't discern exactly why that is, but we have some ideas about this. The first is that it could be that access to information from people who are familiar with the patent process within firms, for example, is more helpful for women because they would be otherwise less plugged into these sources of information because of preexisting networks being different, for example. Or it could be that women are more financially constrained. There's a whole body of research about that. So the benefit of having the financial support from a firm paying for an attorney—these attorneys are thousands of dollars generally to prosecute a patent application. So that benefit of financial support is greater for women than for men if they are within a firm.

Croft: Now, this is a question I know you've thought a lot about. What does the underrepresentation of women in innovation and entrepreneurship mean to society as a whole? What are we missing out on by not having women represented as we would think they should be in innovation?

Subramani: I'm so glad you asked this because this is, I think, really at the heart of why this work matters. First, if we have 50% of the population underrepresented in innovative activities, that means we're missing out on their contributions. Just from the perspective of the level of innovation, we're under-sampling from half of the population. So from a macroeconomic perspective, this is a huge loss in potential economic growth. You're not mining these people's talents and their ideas and their abilities.

Then, if we think more specifically about what might be missing, there is evidence that women are more likely to develop innovations that serve the needs of other women. So teams that include women, for example, are more likely to receive biomedical patents on female-focused inventions. And broadly, I think this makes sense as well. Innovation comes from exposure and expertise. You have to be exposed to a problem or an issue to think about it. The first disposable diaper, for example, was created by a mother. So if female inventors are underrepresented, then women more broadly are underserved because the innovations that can serve women's specific needs are less likely to actually exist.

And then I think there's a whole other set of implications around individual-level benefits to participation in innovation that women are less likely to be able to capitalize on. People are able to benefit from having a patent. Independent inventors can commercialize or sell their patent rights. And even within organizations, individuals who have patents see direct increases in their wages. They become more valuable as employees.

Patents also at the firm level are valuable because they provide firms with intellectual property protection. But they also send a signal to investors. Startups, for example, that hold patents have higher sales and employment growth and better access to funding. So if we zoom out and you think that women are less likely to have patents, it means that they're also missing out on these really tangible pecuniary benefits. And this can be one driver behind the underrepresentation of women in entrepreneurship at large.

So there are a bunch of different dimensions on which this underrepresentation of women hurts the society overall. It hurts women more specifically. And then it also hurts individuals who are not able to benefit from the financial and employment gains that they could get from holding the patent.