Intellectual Property Protection for AI-Generated Output

Döttling, Robin, Logan P. Emery and Shuo Zhao
Authors registered in the RePEc Author Service: Robin Döttling

No 21399, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: We model firms' innovation investment when generative AI can lower investment costs, but only sufficient human input qualifies for IP protection and AI use is unobservable. We characterize the IP system's effect on incentives using two edge cases: when the IP system can "kill" AI use and when low AI costs can "kill" the IP system. If consumers value human-developed products, human-capital use is distorted by adverse selection. The IP policy can mitigate this by acting as a signal of incentives for human-capital use that triggers a feedback loop through consumer beliefs, or by deterring high-cost firms' investment.

Keywords: Generative AI; Innovation; Copyright; Intellectual property protection; Adverse selection (search for similar items in EconPapers)
JEL-codes: G31 G38 O31 O34 O38 (search for similar items in EconPapers)
Date: 2026-04
New Economics Papers: this item is included in nep-ain
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