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In the shadow of giants

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  • Jing-Yuan, Chiou

Abstract

Intellectual giants provide broad shoulders for subsequent inventors. Their unfinished inquiry, however, also casts shadow on the prospect of future research. This paper incorporates this shadow effect into a two-stage innovation process and shows that patenting the first-stage result (the basic invention) may enhance the second-stage innovation. It is optimal to reject patent protection to the basic invention only when this beneficial effect does not arise, and when it is essential to preserve the pioneering inventor's incentive to continue research activities.

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File URL: http://mpra.ub.uni-muenchen.de/37033/
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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 37033.

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Date of creation: Feb 2012
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Handle: RePEc:pra:mprapa:37033

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Related research

Keywords: Cumulative Innovation; Patentable Subject Matter; Probabilistic Patents; Search; Shadow Effect;

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  1. Gershkov, Alex & Perry, Motty, 2009. "Tournaments with midterm reviews," Games and Economic Behavior, Elsevier, vol. 66(1), pages 162-190, May.
  2. Carmen Matutes & Pierre Regibeau & Katharine Rockett, 1996. "Optimal Patent Design and the Diffusion of Innovations," RAND Journal of Economics, The RAND Corporation, vol. 27(1), pages 60-83, Spring.
  3. Heidi L. Williams, 2013. "Intellectual Property Rights and Innovation: Evidence from the Human Genome," Journal of Political Economy, University of Chicago Press, vol. 121(1), pages 1 - 27.
  4. James Bessen & Eric Maskin, 2006. "Sequential Innovation, Patents, and Imitation," Economics Working Papers 0025, Institute for Advanced Study, School of Social Science.
  5. Reiko Aoki & Sadao Nagaoka, 2005. "The Utility Standard and the Patentability of Intermediate Technology," Hi-Stat Discussion Paper Series d04-75, Institute of Economic Research, Hitotsubashi University.
  6. OWAN Hideo & NAGAOKA Sadao, 2011. "Intrinsic and Extrinsic Motivations of Inventors," Discussion papers 11022, Research Institute of Economy, Trade and Industry (RIETI).
  7. Mason, Robin & Välimäki, Juuso, 2011. "Learning about the arrival of sales," Journal of Economic Theory, Elsevier, vol. 146(4), pages 1699-1711, July.
  8. repec:fth:coluec:549 is not listed on IDEAS
  9. David A. Malueg & Shunichi O. Tsutsui, 1997. "Dynamic R&D Competition with Learning," RAND Journal of Economics, The RAND Corporation, vol. 28(4), pages 751-772, Winter.
  10. Stern, Scott & Kolev, Julian & Dewatripont, Mathias & Aghion, Philippe & Murray, Fiona, 2009. "Of Mice and Academics: Examining the Effect of Openness on Innovation," Scholarly Articles 4554220, Harvard University Department of Economics.
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