Fragmented Property Rights and Incentives for R& D

Derek J. Clark () and Kai Konrad
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Derek J. Clark: Department of Economics and Management, Norwegian College of Fishery Science, University of Tromsø, N-9037 Tromsø, Norway

Management Science, 2008, vol. 54, issue 5, 969-981

Abstract: Where product innovation requires several complementary patents, fragmented property rights can limit firms' willingness to invest in R& D. We consider the research intensity in multiple simultaneous R& D contests and how it depends on whether firms already hold relevant patents as well as the availability of an option to invent around. A measure of technological uncertainty is also analyzed. The multiple patent product involves an important hold-up problem that can reduce the overall R& D effort. Invent-around options moderate this problem. We also analyze targeted equilibria in which the aim of R& D can be to hold up a rival.

Keywords: fragmented property rights; patents; contests; hold-up; R& D; inventing around; innovation (search for similar items in EconPapers)
Date: 2008
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Citations: View citations in EconPapers (28)

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Working Paper: Fragmented property rights and incentives for R&D (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:inm:ormnsc:v:54:y:2008:i:5:p:969-981

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