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Knowledge disclosure as intellectual property rights

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Author Info
Carlos J. Ponce ()

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Abstract

We study a model in which an inventor discloses knowledge about its innovation and then a rival chooses the probability of attaining a competing invention. Disclosures, by creating prior art, diminish the probability that the rival has of receiving a patent for its invention (legal externality), but, by revealing knowledge, they decrease the marginal cost of R&D (knowledge externality). We stress the following result. If the knowledge externality is large compared to the legal externality, decreasing the patentability standards leads to fewer disclosures and may hinder R&D. We also determine the impact of changes in market payoffs on the equilibrium level of disclosures and R&D.

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Paper provided by Universidad Carlos III, Departamento de Economía in its series Economics Working Papers with number we077140.

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Date of creation: Oct 2007
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Handle: RePEc:cte:werepe:we077140

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  1. Lanjouw, Jean O & Schankerman, Mark, 2001. "Characteristics of Patent Litigation: A Window on Competition," RAND Journal of Economics, The RAND Corporation, vol. 32(1), pages 129-51, Spring.
  2. Suzanne Scotchmer & Jerry Green, 1990. "Novelty and Disclosure in Patent Law," RAND Journal of Economics, The RAND Corporation, vol. 21(1), pages 131-146, Spring. [Downloadable!] (restricted)
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  3. Vincenzo Denicolo & Luigi Alberto Franzoni, 2004. "Patents, Secrets, and the First-Inventor Defense," Journal of Economics & Management Strategy, Blackwell Publishing, vol. 13(3), pages 517-538, 09. [Downloadable!] (restricted)
  4. Carlos J. POnce, 2007. "More secrecy... more knowledge disclosure? : On disclosure outside of patents," Economics Working Papers we077241, Universidad Carlos III, Departamento de Economía. [Downloadable!]
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  5. Jerry R. Green & Suzanne Scotchmer, 1995. "On the Division of Profit in Sequential Innovation," RAND Journal of Economics, The RAND Corporation, vol. 26(1), pages 20-33, Spring. [Downloadable!] (restricted)
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  6. Wesley M. Cohen & Richard R. Nelson & John P. Walsh, 2000. "Protecting Their Intellectual Assets: Appropriability Conditions and Why U.S. Manufacturing Firms Patent (or Not)," NBER Working Papers 7552, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  7. Talia Bar, 2006. "Defensive Publications in an R&D Race," Journal of Economics & Management Strategy, Blackwell Publishing, vol. 15(1), pages 229-254, 03. [Downloadable!] (restricted)
  8. James J. Anton & Dennis A. Yao, 2003. "Patents, Invalidity, and the Strategic Transmission of Enabling Information," Journal of Economics & Management Strategy, Blackwell Publishing, vol. 12(2), pages 151-178, 06. [Downloadable!] (restricted)
  9. James J. Anton & Dennis A. Yao, 2004. "Little Patents and Big Secrets: Managing Intellectual Property," RAND Journal of Economics, The RAND Corporation, vol. 35(1), pages 1-22, Spring.
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