Waiting to Imitate: On the Dynamic Pricing of Knowledge
AbstractWe study the problem of an inventor who brings to the market an innovation that can be legally imitated. Imitators may “enter” the market by imitating the innovation at a cost or by buying from the inventor the knowledge necessary to reproduce and use the invention. The possibility of contracting dramatically affects the need for patent protection. Our results show that (i) imitators wait to enter the market and the inventor becomes a temporary monopolist; (ii) the inventor sells knowledge through contracts that allow resale by the imitators; and (iii) under certain conditions, the inventor’s payoff increases with the number of imitators.
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Bibliographic InfoArticle provided by University of Chicago Press in its journal Journal of Political Economy.
Volume (Year): 119 (2011)
Issue (Month): 5 ()
Pages: 959 - 981
Contact details of provider:
Web page: http://www.journals.uchicago.edu/JPE/
Other versions of this item:
- Carlos J. Ponce & Emeric Henry, 2011. "Waiting to Imitate: On the Dynamic Pricing of Knowledge," Sciences Po publications info:hdl:2441/eu4vqp9ompq, Sciences Po.
- Carlos J. Ponce & Emeric Henry, 2009. "Waiting to imitate: on the dynamic pricing of knowledge," Sciences Po publications info:hdl:2441/c8dmi8nm4pd, Sciences Po.
- Henry, Emeric & Ponce, Carlos, 2009. "Waiting to imitate: on the dynamic pricing of knowledge," CEPR Discussion Papers 7511, C.E.P.R. Discussion Papers.
- L24 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Contracting Out; Joint Ventures
- O31 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
- O34 - Economic Development, Technological Change, and Growth - - Technological Change; Research and Development; Intellectual Property Rights - - - Intellectual Property Rights
- D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
- C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
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