Patent Portfolios and Firms Technological Choices
Stefano Comino () and
Fabio Manenti ()
No 254, "Marco Fanno" Working Papers from Dipartimento di Scienze Economiche "Marco Fanno"
In many industrial sectors, firms amass large patents portfolios to reinforce their bargaining position vis a vis competitors. In a context where patents have a pure strategic nature, we discuss how the presence and the effectiveness of a patent system affect firms technological decisions. Specifically, we present a two-stage game where firms first choose whether to agglomerate (i.e. develop technologies for the same technological territory) or to separate (i.e. develop technologies for different territories) and then they take their patenting decisions. We show that strong patents may distort technological choices yielding to firms to follow inefficient technological trajectories in an attempt to reduce competitorsâ€™ patenting activity. While an increase in the strength of patent rights âˆ’ i.e. the extent to which patents can be used to extract value âˆ’ undoubtedly distorts firms choices, the impact of a larger scope âˆ’ the degree to which patent protection carries out in the adjacent ares as well âˆ’ is ambiguous. We also discuss how such distortions change when one firm is prevented from obtaining its optimal number of patents and when firms patenting activities generate additional market value.
Keywords: patent portfolios; patent strength and scope; technological territory; strategic patenting (search for similar items in EconPapers)
JEL-codes: D43 L13 (search for similar items in EconPapers)
Pages: 26 pages
New Economics Papers: this item is included in nep-bec, nep-com, nep-ind, nep-ino, nep-ipr, nep-ore and nep-tid
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Persistent link: https://EconPapers.repec.org/RePEc:pad:wpaper:0254
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