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What is the impact of software patent shifts? Evidence from Lotus v. Borland

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  • Lerner, Josh
  • Zhu, Feng

Abstract

Economists have debated the extent to which strengthening patent protection spurs or detracts from technological innovation. In this paper, we examine the reduction of software copyright protection in the Lotus v. Borland decision. If patent and copyright protections are substitutes, then weakening of one form of protection should be associated with an increasing reliance on the other. We find that the firms affected by the diminution of copyright protection disproportionately accelerated their patenting in subsequent years. But little evidence can be found for harmful effects: in fact, the increased reliance on patents is correlated with some positive outcomes for firms.
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  • Lerner, Josh & Zhu, Feng, 2007. "What is the impact of software patent shifts? Evidence from Lotus v. Borland," International Journal of Industrial Organization, Elsevier, vol. 25(3), pages 511-529, June.
  • Handle: RePEc:eee:indorg:v:25:y:2007:i:3:p:511-529
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    Cited by:

    1. Arora, Ashish & Ceccagnoli, Marco & Cohen, Wesley M., 2008. "R&D and the patent premium," International Journal of Industrial Organization, Elsevier, vol. 26(5), pages 1153-1179, September.
    2. Joshua S. Gans & David H. Hsu & Scott Stern, 2008. "The Impact of Uncertain Intellectual Property Rights on the Market for Ideas: Evidence from Patent Grant Delays," Management Science, INFORMS, vol. 54(5), pages 982-997, May.
    3. Autor, David & Dorn, David & Hanson, Gordon & Pisano, Gary & Shu, Pian, 2016. "Foreign Competition and Domestic Innovation: Evidence from U.S. Patents," CEPR Discussion Papers 11664, C.E.P.R. Discussion Papers.
    4. Iain M. Cockburn & Megan J. MacGarvie, 2011. "Entry and Patenting in the Software Industry," Management Science, INFORMS, pages 915-933.
    5. Peng Huang & Marco Ceccagnoli & Chris Forman & D.J. Wu, 2009. "Participation in a Platform Ecosystem: Appropriability, Competition, and Access to the Installed Base," Working Papers 09-14, NET Institute, revised Sep 2009.
    6. Feng Zhu, 2008. "Ad-sponsored Business Models and Compatibility Incentives of Social Networks," Working Papers 08-20, NET Institute, revised Sep 2008.
    7. Wagner, S. & Cockburn, I., 2010. "Patents and the survival of Internet-related IPOs," Research Policy, Elsevier, pages 214-228.
    8. Noel, Michael & Schankerman, Mark, 2006. "Strategic patenting and software innovation," LSE Research Online Documents on Economics 3727, London School of Economics and Political Science, LSE Library.
    9. Sunny Sun & Xiaoming Yang & Weiwen Li, 2014. "Variance-enhancing corporate entrepreneurship under deregulation: An option portfolio approach," Asia Pacific Journal of Management, Springer, vol. 31(3), pages 733-761, September.
    10. Cohen, Wesley M., 2010. "Fifty Years of Empirical Studies of Innovative Activity and Performance," Handbook of the Economics of Innovation, Elsevier.
    11. Wen Wen & Marco Ceccagnoli & Chris Forman, 2012. "Patent Pools, Thickets, and Open Source Software Entry by Start-Up Firms," NBER Chapters,in: Standards, Patents and Innovations National Bureau of Economic Research, Inc.
    12. Peng Huang & Marco Ceccagnoli & Chris Forman & D. J. Wu, 2013. "Appropriability Mechanisms and the Platform Partnership Decision: Evidence from Enterprise Software," Management Science, INFORMS, vol. 59(1), pages 102-121, July.
    13. Noel, Michael & Schankerman, Mark, 2006. "Strategic patenting and software innovation," LSE Research Online Documents on Economics 4653, London School of Economics and Political Science, LSE Library.

    More about this item

    JEL classification:

    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights

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