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Dynamic R&D Competition, Research Line Diversity, and Intellectual Property Rights

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  • Choi, Jay Pil

Abstract

This paper develops a simple model of sequential innovations with a diversity of research lines. Competitive strategies of firms for R&D are analyzed at each stage in a sequence of innovations. We compare two alternative regimes of enforcing patent law, as a mechanism to provide adequate incentives for R&D at each stage. The regime that protects the research line gives monopoly rights to an entire line of research, hence limiting the utilization of the previous knowledge and retarding subsequent innovations. The other regime protects the product, which facilitates the use of previous knowledge at the expense of providing inadequate protection to the ideas embodied in the product, and results in underinvestment in the first stage. Copyright 1993 by MIT Press.

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Bibliographic Info

Article provided by Wiley Blackwell in its journal Journal of Economics & Management Strategy.

Volume (Year): 2 (1993)
Issue (Month): 2 (Summer)
Pages: 277-97

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Handle: RePEc:bla:jemstr:v:2:y:1993:i:2:p:277-97

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Web page: http://www.kellogg.northwestern.edu/research/journals/JEMS/

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Cited by:
  1. Frederick R. Warren-Boulton & Kenneth C. Baseman & Glenn A. Woroch, 1994. "The Economics of Intellectual Property Protection for Software: The Proper Role for Copyright," Industrial Organization 9411004, EconWPA.
  2. Prokop, Jacek & Regibeau, Pierre & Rockett, Katharine, 2010. "Minimum quality standards and novelty requirements in a one-short development race," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy, vol. 4(15), pages 1-49.

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