Dynamic Protection of Innovations through Patents and Trade Secrets

Paul Belleflamme and Paul Bloch

No 4486, CESifo Working Paper Series from CESifo

Abstract: This paper analyzes the optimal protection strategy for an innovator of a complex innovation who faces the risk of imitation by a competitor. We suppose that the innovation can be continuously fragmented into sub-innovations. We characterize the optimal mix of patent and trade secrets when the innovator faces a strict novelty requirement and can only patent a fraction of the innovation once. We also study the optimal dynamic patenting policy in a soft novelty regime, when the innovator can successively patent different fragments of the process. We compare a regime with prior user rights, when the innovator can use the secret part of the process, even when it is patented by an imitator with a regime without prior user rights.

Keywords: patents; trade secrets; dynamic protection of innovation; intellectual property rights (search for similar items in EconPapers)
JEL-codes: O31 O34 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Working Paper: Dynamic protection of innovations through patents and trade secrets (2013)
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