I think is A.

The system of patent-                   {Introduction of a Topic}
     granting, which confers

temporary monopolies for

Line

     the exploitation of new tech-

(5)
nologies, was originally

established as an incentive

to the pursuit of risky new                        {Scope of Topic--Original Intention of patent}
ideas. Yet studies of the                                  {Switch to Major point }
     most patent-conscious

(10)
business of all—the semi-

conductor industry—suggest

that firms do not necessarily

become more innovative as                    {Define the major point}
    they increase their patenting

(15)

activity. Ziedonis and Hall,

for example, found that                       {Explanation /Evidence of major point}
      investment in research and

development (a reasonable

proxy for innovation) did

(20)

not substantially increase

between 1982 and 1992,

the industry’s most feverish

period of patenting. Instead,

semiconductor firms simply

(25)

squeezed more patents out

of existing research and

development expenditures.

Moreover, Ziedonis and

Hall found that as patenting

(30)

activity at semiconductor

firms increased in the

1980’s, the consensus

among industry employees

was that the average quality

(35)

of their firms’ patents

declined. Though patent

quality is a difficult notion

to measure, the number of

times a patent is cited in

(40)

the technical literature is

a reasonable yardstick, and

citations per semiconductor

patent did decline during

the 1980’s. This decline in

(45)

quality may be related to

changes in the way semi-

conductor firms managed

their patenting process:

rather than patenting to win

(50)

exclusive rights to a valuable

new technology, patents

were filed more for strategic

purposes, to be used as

bargaining chips to ward

(55)

off infringement suites or

as a means to block

competitors’ products.