Patents Hinder Collusion
AbstractWe argue that a patent system makes collusion among innovators more difficult. Our simple argument is based on two properties of the patent system. First, a patent not only protects against infringement but also against retaliation by former collusion members. Second, a deviator has an equal chance with former collusion members to get a patent on new innovations. We show that if a patent system reduces spillovers, it renders collusion impossible. Moreover, it is possible to design a patent system that simultaneously increases knowledge spillovers and eliminates collusion
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Bibliographic InfoPaper provided by EconWPA in its series Industrial Organization with number 0503015.
Length: 27 pages
Date of creation: 31 Mar 2005
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Patens; Collusion; Secrecy; Innovation;
Find related papers by JEL classification:
- L - Industrial Organization
This paper has been announced in the following NEP Reports:
- NEP-ALL-2005-04-16 (All new papers)
- NEP-COM-2005-04-16 (Industrial Competition)
- NEP-IND-2005-04-16 (Industrial Organization)
- NEP-INO-2005-04-16 (Innovation)
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