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Live and Let Live: A Tale of Weak Patents

Author

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  • Jay Pil Choi

    (Michigan State University,)

Abstract

Patent protection has gradually expanded over time, and many patents of suspect value are routinely granted owing to the lack of rigorous scrutiny in the examination process. This has resulted in the recent explosion of patents granted and potentially creates a "patent thicket"that hinders future innovation. I investigate the question of whether the litigation process can be relied on to restore competition when an imperfect market outcome is sustained through patents of suspect value. The analysis undertaken in the paper points out the serious lack of private incentives to eliminate patents of suspect value through litigation. I also discuss potential measures to restore the soundness of the patent system. (JEL: O3, L1, L4, D8, K4) Copyright (c) 2005 The European Economic Association.

Suggested Citation

  • Jay Pil Choi, 2005. "Live and Let Live: A Tale of Weak Patents," Journal of the European Economic Association, MIT Press, vol. 3(2-3), pages 724-733, 04/05.
    • Handle: RePEc:tpr:jeurec:v:3:y:2005:i:2-3:p:724-733
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    Citations

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    Cited by:

    1. Lei, Zhen & Wright, Brian D., 2017. "Why weak patents? Testing the examiner ignorance hypothesis," Journal of Public Economics, Elsevier, vol. 148(C), pages 43-56.
    2. Mark Schankerman & Florian Schuett, 2022. "Patent Screening, Innovation, and Welfare [Innovation, Reallocation, and Growth]," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 89(4), pages 2101-2148.
    3. Dietmar Harhoff & Georg von Graevenitz & Stefan Wagner, 2016. "Conflict Resolution, Public Goods, and Patent Thickets," Management Science, INFORMS, vol. 62(3), pages 704-721, March.
    4. de Rassenfosse, Gaetan & Higham, Kyle, 2019. "Decentralising the Patent System," SocArXiv qzmf8, Center for Open Science.
    5. Nancy Gallini, 2011. "Private agreements for coordinating patent rights: the case of patent pools," ECONOMIA E POLITICA INDUSTRIALE, FrancoAngeli Editore, vol. 2011(3), pages 5-30.
    6. Lei, Zhen & Wright, Brian D., 2009. "Why weak patents? Rational ignorance or pro-"customer" Tilt?," 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin 49279, Agricultural and Applied Economics Association.
    7. Comino, Stefano & Graziano, Clara, 2015. "How many patents does it take to signal innovation quality?," International Journal of Industrial Organization, Elsevier, vol. 43(C), pages 66-79.
    8. Mathias Dewatripont & Patrick Legros, 2013. "‘Essential’ Patents, FRAND Royalties and Technological Standards," Journal of Industrial Economics, Wiley Blackwell, vol. 61(4), pages 913-937, December.
    9. Erik Hovenkamp & Jorge Lemus, 2022. "Antitrust Limits on Patent Settlements: A New Approach," Journal of Industrial Economics, Wiley Blackwell, vol. 70(2), pages 257-293, June.
    10. Joseph Farrell & Carl Shapiro, 2008. "How Strong Are Weak Patents?," American Economic Review, American Economic Association, vol. 98(4), pages 1347-1369, September.
    11. Hovenkamp, Erik & Lemus, Jorge, 2018. "Delayed entry settlements at the patent office," International Review of Law and Economics, Elsevier, vol. 54(C), pages 30-38.
    12. Richman Jesse T., 2012. "The Political Economy of Congressional Patent Policymaking in the Late 20th Century," Review of Law & Economics, De Gruyter, vol. 8(1), pages 91-100, May.
    13. Chen, Yongmin & Pan, Shiyuan & Zhang, Tianle, 2014. "(When) Do stronger patents increase continual innovation?," Journal of Economic Behavior & Organization, Elsevier, vol. 98(C), pages 115-124.
    14. Kwon, Seokbeom, 2021. "The prevalence of weak patents in the United States: A new method to identify weak patents and the implications for patent policy," Technology in Society, Elsevier, vol. 64(C).
    15. Buehler, Benno & Hunold, Matthias & Schlütter, Frank, 2021. "No-Challenge Clauses in Patent Licensing - Blessing or Curse?," LIDAM Discussion Papers CORE 2021032, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    16. Gallini, Nancy, 2015. "Promoting Competition by Coordinating Prices: When Rivals Share Intellectual Property," Economics working papers nancy_gallini-2015-22, Vancouver School of Economics, revised 07 Dec 2015.

    More about this item

    JEL classification:

    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights
    • L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
    • L4 - Industrial Organization - - Antitrust Issues and Policies
    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty
    • K4 - Law and Economics - - Legal Procedure, the Legal System, and Illegal Behavior

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