Patent licensing and research exemption
Within an environment of sequential innovations, real world evidence suggests that the licensing decision of the initial patent can occur either before or after the R&D investment of the follow-on invention. The possibility of licensing after the follow-on invention exists due to the presence of research exemption. This paper examines how the research exemption influences the licensor''s decision to license prior to the discovery of the follow-on invention. Within a three firm setting, the paper reveals that the research exemption does not alter the licensing decision while promoting a stream of future inventions. This provides an argument in support of research exemption as legal scheme.
Volume (Year): 29 (2009)
Issue (Month): 2 ()
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References listed on IDEAS
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- James Bessen & Eric Maskin, 2006.
"Sequential Innovation, Patents, and Imitation,"
Economics Working Papers
0025, Institute for Advanced Study, School of Social Science.
- Nagaoka, Sadao & Aoki, Reiko, 2006.
"Economics of Research Exemption,"
IIR Working Paper
06-04, Institute of Innovation Research, Hitotsubashi University.
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