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Efficient Patent Pools

Author

Listed:
  • Josh Lerner
  • Jean Tirole

Abstract

The paper builds a tractable model of patent pools, agreements among patent owners to license sets of their patents. It provides a necessary and sufficient condition for patent pools to enhance welfare and shows that requiring pool members to be able to independently license patents matters if and only if the pool is otherwise welfare reducing. The paper allows patents to differ in importance, asymmetric blocking patterns, and licensors to also be licensees. We undertake some initial exploration of the impact of pools on innovation. The analysis has broader applicability than pools, being relevant to a number of co-marketing arrangements.

Suggested Citation

  • Josh Lerner & Jean Tirole, 2004. "Efficient Patent Pools," American Economic Review, American Economic Association, vol. 94(3), pages 691-711, June.
  • Handle: RePEc:aea:aecrev:v:94:y:2004:i:3:p:691-711
    Note: DOI: 10.1257/0002828041464641
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    References listed on IDEAS

    as
    1. Hausman, Jerry A & Leonard, Gregory K & Tirole, Jean, 2003. "On Nonexclusive Membership in Competing Joint Ventures," RAND Journal of Economics, The RAND Corporation, vol. 34(1), pages 43-62, Spring.
    2. Rasmusen, Eric, 1988. "Entry for Buyout," Journal of Industrial Economics, Wiley Blackwell, vol. 36(3), pages 281-299, March.
    3. Brueckner, Jan K & Whalen, W Tom, 2000. "The Price Effects of International Airline Alliances," Journal of Law and Economics, University of Chicago Press, vol. 43(2), pages 503-545, October.
    4. Vincenzo Denicolo, 2002. "Sequential innovation and the patent-antitrust conflict," Oxford Economic Papers, Oxford University Press, vol. 54(4), pages 649-668, October.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    JEL classification:

    • K11 - Law and Economics - - Basic Areas of Law - - - Property Law
    • L41 - Industrial Organization - - Antitrust Issues and Policies - - - Monopolization; Horizontal Anticompetitive Practices

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