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Who is afraid of pirates? An experiment on the deterrence of innovation by imitation

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  • Engel, Christoph
  • Kleine, Marco

Abstract

In the policy debate, intellectual property is often justified by what seems to be a straightforward argument: if innovators are not protected against others appropriating their ideas, incentives for innovation are suboptimally low. Now, in most industries and for most potential users, appropriating a foreign innovation is itself an investment decision fraught with cost and risk. Nonetheless, standard theory predicts too little innovation. Arguably the problem is exacerbated by the sensitivity of innovators to fairness; imitators do get a free lunch, after all.

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  • Engel, Christoph & Kleine, Marco, 2015. "Who is afraid of pirates? An experiment on the deterrence of innovation by imitation," Research Policy, Elsevier, vol. 44(1), pages 20-33.
  • Handle: RePEc:eee:respol:v:44:y:2015:i:1:p:20-33 DOI: 10.1016/j.respol.2014.07.020
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    Cited by:

    1. Santos-Arteaga, Francisco J. & Di Caprio, Debora & Tavana, Madjid & O’Connor, Aidan, 2017. "Innovation dynamics and labor force restructuring with asymmetrically developed national innovation systems," International Business Review, Elsevier, vol. 26(1), pages 36-56.

    More about this item

    Keywords

    Innovation; Imitation; Appropriation; Patent;

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • K11 - Law and Economics - - Basic Areas of Law - - - Property Law
    • L17 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Open Source Products and Markets
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives

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