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Reinforcing the patent system? Patent fencing, knowledge diffusion and welfare

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Author Info
Murat YILDIZOGLU (E3i-IFReDE-GRES)

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Abstract

This article develops an evolutionary model of industry dynamics in order to carry out a richer theoretical analysis of the consequences of a stronger patent system. This model explicitly takes into account the potentially positive effects of the patents: Publication of patents participates to the building of a collective knowledge stock on which the innovations can rely, and dropped patents can provide a source of technological progress for firms that are lagging behind the leaders of the industry. These dimensions of the patent system are used to question the negative results of Vallée & Yildizoglu (2006). The main results of the new model show that these positive effects do not counterbalance the negative effects of a stronger patent system on social welfare and global technological progress, even if it is a source of better protection and higher profits for the firms.

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Publisher Info
Paper provided by Groupement de Recherches Economiques et Sociales in its series Cahiers du GRES with number 2006-23.

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Date of creation: 2006
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Handle: RePEc:grs:wpegrs:2006-23

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Web page: http://gres.u-bordeaux4.fr/
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Related research
Keywords: Innovation; Technical progress; Patent system; Intellectual property rights (IPR); Technology policy; Technological regimes;

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Find related papers by JEL classification:
O3 - Economic Development, Technological Change, and Growth - - Technological Change
O34 - Economic Development, Technological Change, and Growth - - Technological Change - - - Intellectual Property Rights
L52 - Industrial Organization - - Regulation and Industrial Policy - - - Industrial Policy; Sectoral Planning Methods

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  1. Nancy Gallini & Suzanne Scotchmer, 2002. "Intellectual Property: When Is It the Best Incentive System?," NBER Chapters, in: Innovation Policy and the Economy, Volume 2, pages 51-78 National Bureau of Economic Research, Inc. [Downloadable!]
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  2. Thomas Vallée & Murat YıLdızoğlu, 2006. "Social and technological efficiency of patent systems," Journal of Evolutionary Economics, Springer, vol. 16(1), pages 189-206, April. [Downloadable!] (restricted)
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  3. Ted O'Donoghue & Suzanne Scotchmer & Jacques-François Thisse, 1998. "Patent Breadth, Patent Life, and the Pace of Technological Progress," Journal of Economics & Management Strategy, Blackwell Publishing, vol. 7(1), pages 1-32, 03. [Downloadable!] (restricted)
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