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Dark sides of patent pools with independent licensing

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  • Ishihara, Akifumi
  • Yanagawa, Noriyuki

Abstract

This study examines the welfare effects of patent pools with independent licensing. We argue that forcing patent pools to allow each individual patent holder to license the technology independently does not necessarily work as a screening tool to select only desirable patent pools. We consider a duopolistic model in which some users demand only specific technologies. We demonstrate that a patent pool with independent licensing enables patent holders to undertake anti-competitive price discrimination. Moreover, since forming a patent pool mitigates the price competition forced by lower grade entrants, combination with independent licensing might worsen welfare further.

Suggested Citation

  • Ishihara, Akifumi & Yanagawa, Noriyuki, 2018. "Dark sides of patent pools with independent licensing," International Journal of Industrial Organization, Elsevier, vol. 57(C), pages 1-34.
  • Handle: RePEc:eee:indorg:v:57:y:2018:i:c:p:1-34
    DOI: 10.1016/j.ijindorg.2017.12.005
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    References listed on IDEAS

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    Cited by:

    1. Takanori Adachi & Takeshi Ebina, 2014. "Complementing Cournot’s analysis of complements: unidirectional complementarity and mergers," Journal of Economics, Springer, vol. 111(3), pages 239-261, April.
    2. Lampert, Hodaya & Wettstein, David, 2020. "Patents and pools in pyramidal innovation structures," International Journal of Industrial Organization, Elsevier, vol. 69(C).

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