This article uses a two-step technological race model to evaluate the optimal protection of new research instruments, i.e., inventions that are not directly associated to commercial profits but that facilitate further technological progress. We show that paradoxically, granting the patentee an exclusive ownership right over all the research line and related applications (prospect doctrine) is optimal only when the R&D costs are relatively low and when the courts can implement mixed strategies regarding the settlement of patent trials (thus implying that identical legal cases lead to differing outcomes). In other settings, the court should rather force the infringer to pay a license fee proportionate to the R&D savings generated by the disclosure of the research instrument (enablement doctrine).
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Find related papers by JEL classification: K2 - Law and Economics - - Regulation and Business Law L00 - Industrial Organization - - General - - - General O31 - Economic Development, Technological Change, and Growth - - Technological Change - - - Innovation and Invention: Processes and Incentives O32 - Economic Development, Technological Change, and Growth - - Technological Change - - - Management of Technological Innovation and R&D
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