Damages and Injunctions in the Protection of Proprietary Research Tools
AbstractProfit on proprietary research tools is determined partly by the remedies for infringement, such as damages and injunctions. We investigate how damages under a liability rule and the opportunity for injunctions under a property rule can affect the incentives to develop research tools. We show that the prevailing legal doctrine of damages under liability rule, called lost profit or reasonable royalty, suffers from a logical circularity which leads to an indeterminacy in permissible damages. This can create insufficient incentives to develop research tools. Incentives can be improved either by a property rule with injunctions or by a liability rule under the doctrine of unjust enrichment.
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Bibliographic InfoPaper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 7086.
Date of creation: Apr 1999
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Publication status: published as Schankerman, Mark & Scotchmer, Suzanne, 2001. "Damages and Injunctions in Protecting Intellectual Property," RAND Journal of Economics, The RAND Corporation, vol. 32(1), pages 199-220, Spring.
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- Scotchmer, Suzanne & Schankerman, Mark, 1999. "Damages and Injunctions in the Protection of Proprietary Research Tools," Berkeley Olin Program in Law & Economics, Working Paper Series qt0dh221jq, Berkeley Olin Program in Law & Economics.
- K0 - Law and Economics - - General
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