To B or Not To B: A Welfare Analysis of Breaking Up Monopolies in an Endogenous Growth Model

Danyang Xie

GE, Growth, Math methods from EconWPA

Abstract: This paper studies the welfare consequences of a government regulation that forces a patented equipment to be supplied by a number of independent producers. On the one hand, such a regulation hurts the value of a patent and therefore reduces activities in the R&D sector. On the other hand, the enhanced competition for the equipment improves efficiency in the manufacturing sector. Should monopolies protected by intellectual property rights be broken up? The answer is "no" in a Romer-type growth model, but there is sufficient reason to believe that the answer could be "yes" in a model advocated by Jones (1995).

Keywords: R&D; Endogenous Growth; Competition Policy (search for similar items in EconPapers)
JEL-codes: O31 O38 O41 (search for similar items in EconPapers)
Date: 2002-08-21
Note: Type of Document - Acrobat PDF; prepared on PC; to print on HP; pages: 17; figures: none

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http://129.3.20.41/eps/ge/papers/0207/0207002.pdf (application/pdf)

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Working Paper: To "B" or not to "B": A Welfare Analysis of Breaking Up Monopolies in an Endogenous Growth Model
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Persistent link: http://EconPapers.repec.org/RePEc:wpa:wuwpge:0207002

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