Cooperation in R and D - The Case of Patent Infringement Agreements
AbstractThis paper is an attempt to provide a strategic rationale behind patent infringement agreements (PIA). We interpret such agreements as yet another form of cooperation in a non-cooperative environment. If the infringement probability is not 'too' low, firms would have incentive to sign a PIA sacrificing the right to punish the offender. In a simple Cournot-Nash model with linear demand, we show that the infringement probability as low as near 1/5 could induce PIA.
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Bibliographic InfoPaper provided by University of Bonn, Germany in its series Discussion Paper Serie A with number 419.
Length: 16 pages
Date of creation: Mar 1993
Date of revision: Sep 1993
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Find related papers by JEL classification:
- D45 - Microeconomics - - Market Structure and Pricing - - - Rationing; Licensing
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
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