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Strategic Disclosure of Intermediate Research Results

Author

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  • David Gill

Abstract

"We analyze the incentives to disclose intermediate research results during the course of a patent contest. Despite knowledge spillovers, the leading innovator sometimes discloses to signal commitment to the project, and so potentially inducing a rival's exit. Surprisingly, when development costs are low the leading innovator does not need to disclose to induce the same strategic deterrence effect as that which arises from disclosure. Taking into account wasteful duplication of R&D effort, a patent office can increase welfare by choosing the probability of granting a contested patent and so altering the proportion of rivals that the leading innovator deters." Copyright (c) 2008, The Author(s) Journal Compilation (c) 2008 Wiley Periodicals, Inc..

Suggested Citation

  • David Gill, 2008. "Strategic Disclosure of Intermediate Research Results," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 17(3), pages 733-758, September.
  • Handle: RePEc:bla:jemstr:v:17:y:2008:i:3:p:733-758
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    References listed on IDEAS

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    1. Kenneth L. Judd, 2003. "Closed-loop equilibrium in a multi-stage innovation race," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 21(2), pages 673-695, March.
    2. James J. Anton & Dennis A. Yao, 2002. "The Sale of Ideas: Strategic Disclosure, Property Rights, and Contracting," Review of Economic Studies, Oxford University Press, vol. 69(3), pages 513-531.
    3. Reinganum, Jennifer F., 1981. "Dynamic games of innovation," Journal of Economic Theory, Elsevier, vol. 25(1), pages 21-41, August.
    4. Sudipto Bhattacharya & Jay R. Ritter, 1983. "Innovation and Communication: Signalling with Partial Disclosure," Review of Economic Studies, Oxford University Press, vol. 50(2), pages 331-346.
    5. Grossman, Gene M & Shapiro, Carl, 1987. "Dynamic R&D Competition," Economic Journal, Royal Economic Society, vol. 97(386), pages 372-387, June.
    6. Suzanne Scotchmer & Jerry Green, 1990. "Novelty and Disclosure in Patent Law," RAND Journal of Economics, The RAND Corporation, vol. 21(1), pages 131-146, Spring.
    7. De Fraja, Giovanni, 1993. "Strategic spillovers in patent races," International Journal of Industrial Organization, Elsevier, vol. 11(1), pages 139-146, March.
    8. Reinganum, Jennifer F, 1982. "A Dynamic Game of R and D: Patent Protection and Competitive Behavior," Econometrica, Econometric Society, vol. 50(3), pages 671-688, May.
    9. Joseph Farrell & Garth Saloner, 1985. "Installed Base and Compatibility With Implications for Product Preannouncements," Working papers 385, Massachusetts Institute of Technology (MIT), Department of Economics.
    10. Christopher Harris & John Vickers, 1987. "Racing with Uncertainty," Review of Economic Studies, Oxford University Press, vol. 54(1), pages 1-21.
    11. Tom Lee & Louis L. Wilde, 1980. "Market Structure and Innovation: A Reformulation," The Quarterly Journal of Economics, Oxford University Press, vol. 94(2), pages 429-436.
    12. Glenn C. Loury, 1979. "Market Structure and Innovation," The Quarterly Journal of Economics, Oxford University Press, vol. 93(3), pages 395-410.
    13. Mukesh Eswaran & Nancy Gallini, 1996. "Patent Policy and the Direction of Technological Change," RAND Journal of Economics, The RAND Corporation, vol. 27(4), pages 722-746, Winter.
    14. James J. Anton & Dennis A. Yao, 2004. "Little Patents and Big Secrets: Managing Intellectual Property," RAND Journal of Economics, The RAND Corporation, vol. 35(1), pages 1-22, Spring.
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    Citations

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    Cited by:

    1. Jos Jansen, 2005. "The Effects of Disclosure Regulation of an Innovative Firm," CESifo Working Paper Series 1459, CESifo Group Munich.
    2. Carolin Haeussler & Lin Jiang & Jerry Thursby & Marie C. Thursby, 2009. "Specific and General Information Sharing Among Academic Scientists," NBER Working Papers 15315, National Bureau of Economic Research, Inc.
    3. Ponce, Carlos J., 2011. "Knowledge disclosure as intellectual property rights protection," Journal of Economic Behavior & Organization, Elsevier, vol. 80(3), pages 418-434.
    4. repec:bla:ecinqu:v:55:y:2017:i:2:p:806-824 is not listed on IDEAS
    5. Haeussler, Carolin, 2011. "Information-sharing in academia and the industry: A comparative study," Research Policy, Elsevier, vol. 40(1), pages 105-122, February.
    6. Rockett, Katharine, 2012. "Perspectives on the knowledge-based society: An introduction to the special issue," Economics - The Open-Access, Open-Assessment E-Journal, Kiel Institute for the World Economy (IfW), vol. 6, pages =1-22.
    7. Rockett, Katharine, 2010. "Property Rights and Invention," Handbook of the Economics of Innovation, Elsevier.
    8. Cho, Myeonghwan & Jun, Byung-hill, 2013. "Information sharing with competition," Economics Letters, Elsevier, vol. 119(1), pages 81-84.
    9. Haeussler, Carolin & Jiang, Lin & Thursby, Jerry & Thursby, Marie, 2014. "Specific and general information sharing among competing academic researchers," Research Policy, Elsevier, vol. 43(3), pages 465-475.
    10. Ajay Bhaskarabhatla & Enrico Pennings, 2012. "Defensive Disclosure under Antitrust Enforcement," Tinbergen Institute Discussion Papers 12-010/2, Tinbergen Institute.
    11. repec:bla:randje:v:48:y:2017:i:2:p:438-466 is not listed on IDEAS
    12. Kerstan, Sven & Kretschmer, Tobias & Muehlfeld, Katrin, 2012. "The dynamics of pre-market standardization," Information Economics and Policy, Elsevier, vol. 24(2), pages 105-119.
    13. Johnson, Justin P., 2014. "Defensive publishing by a leading firm," Information Economics and Policy, Elsevier, vol. 28(C), pages 15-27.
    14. Aoki, Reiko & Spiegel, Yossi, 2009. "Pre-grant patent publication and cumulative innovation," International Journal of Industrial Organization, Elsevier, vol. 27(3), pages 333-345, May.
    15. Jos Jansen, 2010. "STRATEGIC INFORMATION DISCLOSURE AND COMPETITION FOR AN IMPERFECTLY PROTECTED INNOVATION -super-," Journal of Industrial Economics, Wiley Blackwell, vol. 58(2), pages 349-372, June.
    16. Kretschmer, Tobias & Muehlfeld, Katrin, 2006. "Co-opetition and prelaunch in standard-setting for developing technologies," LSE Research Online Documents on Economics 19843, London School of Economics and Political Science, LSE Library.
    17. Daniel P. Gross, 2017. "Performance feedback in competitive product development," RAND Journal of Economics, RAND Corporation, vol. 48(2), pages 438-466, May.

    More about this item

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • L19 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Other
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D

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