Patents, industry control, and the rise of the giant American corporation

Peter Scott and Anna Spadavecchia

Research Policy, 2023, vol. 52, issue 1

Abstract: We examine how some early corporations used patents to control competition, thus creating monopoly or cartel positions, with super-normal profits. We thus highlight one economic rationale for the rise of the giant corporation, expanding the Chandlerian paradigm. Based on evidence from the House of Representatives', 1912 “Oldfield hearings” and three industry case studies, we demonstrate how patent pools and restrictive licensing of fundamental patents led to the stifling of innovation and to negative competition and welfare effects. Focusing on pooling and licensing agreements is particularly important, as these, unlike patents themselves, are not normally open to public scrutiny.

Keywords: Intellectual property rights; Patent pools; Restrictive licensing; Industry control; USA corporations; Business history (search for similar items in EconPapers)
JEL-codes: D22 D43 L41 L42 O31 O34 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:respol:v:52:y:2023:i:1:s004873332200172x

DOI: 10.1016/j.respol.2022.104651

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