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Patent Scope and Technology Choice

Erika Färnstrand Damsgaard

No 792, Working Paper Series from Research Institute of Industrial Economics

Abstract: This paper analyzes the effect of an increase in patent scope on R&D and innovation. It presents a model where patent scope affects an entrant firm's technology choice and thereby creates a trade-off between R&D investments and wasteful duplication of R&D. The model predicts that an increase in patent scope can increase the probability of innovation if the incumbent’s profit increase from innovation is large and the patented technology has a small advantage over the alternative technology. However, when the model is extended to Stackelberg competition or licensing, the benefit of a broad patent scope to a large extent disappears.

Keywords: Innovation; Patents; Patent policy; Licensing (search for similar items in EconPapers)
JEL-codes: K20 L51 (search for similar items in EconPapers)
Pages: 39 pages
Date: 2009-03-03
New Economics Papers: this item is included in nep-ino, nep-ipr, nep-pr~, nep-knm, nep-law, nep-mic and nep-tid
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:hhs:iuiwop:0792

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