Chasing Patents

Flavio Menezes () and Rohan Pitchford ()
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Rohan Pitchford: Australian National University

No 597, Governance Working Papers from East Asian Bureau of Economic Research

Abstract: We examine the problem faced by a company that wishes to purchase patents in the hands of two different patent owners. Complementarity of these patents in the production process of the company is a prime efficiency reason for them being owned (or licenced) by the company. We show that this very same complementarity can lead to patent owners behaving strategically in bargaining, and delaying their sale to the company. When the company is highly leveraged, such inefficient delay is limited. Comparative statics results are also obtained.

Keywords: patent; bargaining; leverage; production process; efficiency (search for similar items in EconPapers)
JEL-codes: J50 (search for similar items in EconPapers)
Date: Written
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http://www.eaber.org/intranet/documents/26/597/APSEG_Menezes_02.pdf First Version, 2005 (application/pdf)

Related works:
Working Paper: Chasing Patents (2001)
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