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Knowledge disclosure as intellectual property rights

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  • 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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File URL: http://e-archivo.uc3m.es/bitstream/10016/1102/1/Disclosurepaper3_final.pdf
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Bibliographic Info

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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References

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  1. Wesley M Cohen & Richard R Nelson & John P Walsh, 2003. "Protecting Their Intellectual Assets: Appropriability Conditions and Why U.S. Manufacturing Firms Patent (Or Not)," Levine's Working Paper Archive 618897000000000624, David K. Levine.
  2. Vincenzo Denicolo & Luigi Alberto Franzoni, 2004. "Patents, Secrets, and the First-Inventor Defense," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 13(3), pages 517-538, 09.
  3. 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.
  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.
  5. Talia Bar, 2006. "Defensive Publications in an R&D Race," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 15(1), pages 229-254, 03.
  6. James J. Anton & Dennis A. Yao, 2003. "Patents, Invalidity, and the Strategic Transmission of Enabling Information," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 12(2), pages 151-178, 06.
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Cited by:
  1. Ponzetto, Giacomo AM, 2012. "Intellectual Property Rights and Efficient Firm Organization," CEPR Discussion Papers 9212, C.E.P.R. Discussion Papers.

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