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Property Rights in Emerging Platform Technologies

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  • Lichtman, Douglas

Abstract

This article considers an externality that affects abroad range of markets, specifically markets where one set of firms sells some platform technology such as a computer, video game console, or operating system, while another possibly overlapping set of firms sells peripherals compatible with that platform, for example, computer software or video game cartridges. The externality causes certain peripheral sellers to charge prices that are unprofitably high. That is, these firms could earn greater profits if only they could coordinate to charge lower prices. In many markets, such coordination is possible: firms can contract, for example, or integrate. In markets based on relatively new platform technologies, however, coordination will typically be difficult. The article explains why and argues that intellectual property law can and should facilitate price coordination in these "emerging technology" settings. Copyright 2000 by the University of Chicago.

Suggested Citation

  • Lichtman, Douglas, 2000. "Property Rights in Emerging Platform Technologies," The Journal of Legal Studies, University of Chicago Press, vol. 29(2), pages 615-648, June.
    • Handle: RePEc:ucp:jlstud:v:29:y:2000:i:2:p:615-48
    DOI: 10.1086/468087
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    Cited by:

    1. Shuya Yin, 2010. "Alliance Formation Among Perfectly Complementary Suppliers in a Price-Sensitive Assembly System," Manufacturing & Service Operations Management, INFORMS, vol. 12(3), pages 527-544, October.

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