Patents as firm’s innovativeness indicator: advantages and disadvantages

There is undisputed need to properly measure innovativeness and patent data is commonly used in order to achieve that. However, its drawbacks are rarely taken into account. The aim of this article is to identify main advantages and disadvantages of using patents as innovativeness indicators - based on the literature analysis. Authors conclude that patents are valuable innovativeness indicators, which among others are very accessible and easy to use, but on the other hand they cannot be regarded as universal, as they have significant drawbacks and thus may lead to false conclusions. Therefore, it is still advised to use patent data, but only if being fully aware of their limitations.