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Entrepreneurial Commercialization Choices and the Interaction between IPR and Competition Policy

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  • Gans, Joshua S.

    ()
    (Rotman School of Management)

  • Persson, Lars

    ()
    (Research Institute of Industrial Economics (IFN))

Abstract

This paper examines the interaction between intellectual property protection and competition policy on the choice of entrepreneurs with respect to commercialization as well as the rate of innovation. We find that stronger intellectual property protection makes it more likely that entrepreneurs will commercialize by cooperating with incumbents rather than competing with them. Consequently, we demonstrate that competition policy has a clearer role in promoting a higher rate of innovation in that event. Hence, we identify one reason why the strength of the two policies may be complements from the perspective of increasing the rate of entrepreneurial innovation.

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Bibliographic Info

Paper provided by Research Institute of Industrial Economics in its series Working Paper Series with number 895.

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Length: 29 pages
Date of creation: 03 Jan 2012
Date of revision:
Handle: RePEc:hhs:iuiwop:0895

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Keywords: Entrepreneurs; Innovation; Commercialization; Intellectual property law; Competition law;

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  1. Boone, J., 2000. "Competition," Discussion Paper 2000-104, Tilburg University, Center for Economic Research.
  2. Norbäck, Pehr-Johan & Persson, Lars, 2012. "Entrepreneurial innovations, competition and competition policy," European Economic Review, Elsevier, vol. 56(3), pages 488-506.
  3. Arora, Ashish & Fosfuri, Andrea & Gambardella, Alfonso, 2001. "Markets for Technology and Their Implications for Corporate Strategy," Industrial and Corporate Change, Oxford University Press, vol. 10(2), pages 419-51, June.
  4. Salant, Stephen W, 1984. "Preemptive Patenting and the Persistence of Monopoly: Comment," American Economic Review, American Economic Association, vol. 74(1), pages 247-50, March.
  5. Anton, James J & Yao, Dennis A, 1994. "Expropriation and Inventions: Appropriable Rents in the Absence of Property Rights," American Economic Review, American Economic Association, vol. 84(1), pages 190-209, March.
  6. Granstrand, Ove & Sjölander, Sören, 1990. "The Acquisition of Technology and Small Firms by Large Firms," Working Paper Series 213, Research Institute of Industrial Economics.
  7. Braunerhjelm, Pontus & Svensson, Roger, 2007. "The inventor's role: was Schumpeter right?," Working Paper Series in Economics and Institutions of Innovation 78, Royal Institute of Technology, CESIS - Centre of Excellence for Science and Innovation Studies.
  8. Granstrand, Ove & Sjolander, Soren, 1990. "The acquisition of technology and small firms by large firms," Journal of Economic Behavior & Organization, Elsevier, vol. 13(3), pages 367-386, June.
  9. Nancy T. Gallini & Ralph A. Winter, 1985. "Licensing in the Theory of Innovation," RAND Journal of Economics, The RAND Corporation, vol. 16(2), pages 237-252, Summer.
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