Acquisition for Sleep

Pehr-Johan Norbäck, Charlotta Olofsson and Lars Persson

No 8095, CESifo Working Paper Series from CESifo

Abstract: Within the policy debate, there is a fear that large incumbent firms buy small firms’ inventions to ensure that they are not used in the market. We show that such “acquisitions for sleep” can occur if and only if the quality of a process invention is small; otherwise, the entry profit will be higher than the entry-deterring value. We then show that the incentive for acquiring for the purpose of putting a patent to sleep decreases when the intellectual property law is stricter because the profit for the entrant then increases more than the entry-deterring value does.

Keywords: acquisitions; innovation; sleeping patents; IP law; ownership (search for similar items in EconPapers)
JEL-codes: G24 L10 L20 M13 O30 (search for similar items in EconPapers)
Date: 2020
New Economics Papers: this item is included in nep-cfn, nep-com, nep-ino, nep-ipr and nep-tid
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Related works:
Journal Article: Acquisitions for Sleep (2020)
Journal Article: Acquisitions for Sleep (2020)
Working Paper: Acquisition for Sleep (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_8095

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