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More Secrecy...More Knowledge Disclosure? On Disclosure Outside of Patents

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  • Carlos J Ponce

Abstract

It is an important concern that innovators by waiving their patent rights might obstruct the disclosure of knowledge and therefore retard progress. This paper explores this concern by using a simple model of two innovators who must decide sequentially whether to protect an innovation with limited patent rights. Two features are crucial to the disclosure decision. First: the second inventor may use his valid patent right to exclude the first inventor from using a secret invention. Second: when waiving her patent right, the first inventor may disclose her knowledge outside of a patent. Disclosure informs the Patent Office and courts that related inventions from later inventors may lack novelty and hence should not be protected by valid patent rights. This paper shows that when the first inventor chooses not to patent the innovation, the amount of disclosure is related to the intellectual property choices in a paradoxical way: the amount of disclosure will be ‘large’ (‘small’) when the second inventor chooses secrecy (patenting) to protect the innovation too.
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Suggested Citation

  • Carlos J Ponce, 2007. "More Secrecy...More Knowledge Disclosure? On Disclosure Outside of Patents," Levine's Working Paper Archive 122247000000001600, David K. Levine.
  • Handle: RePEc:cla:levarc:122247000000001600
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    Cited by:

    1. Crass, Dirk & Garcia Valero, Francisco & Pitton, Francesco & Rammer, Christian, 2016. "Protecting innovation through patents and trade secrets: Determinants and performance impacts for firms with a single innovation," ZEW Discussion Papers 16-061, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    2. Michele Boldrin & David K. Levine, 2013. "The Case against Patents," Journal of Economic Perspectives, American Economic Association, vol. 27(1), pages 3-22, Winter.
    3. Bronwyn Hall & Christian Helmers & Mark Rogers & Vania Sena, 2014. "The Choice between Formal and Informal Intellectual Property: A Review," Journal of Economic Literature, American Economic Association, vol. 52(2), pages 375-423, June.
    4. Ponce, Carlos J., 2007. "Knowledge disclosure as intellectual property rights," UC3M Working papers. Economics we077140, Universidad Carlos III de Madrid. Departamento de Economía.
    5. Joachim Henkel & Stefanie Pangerl, 2008. "Defensive Publishing An Empirical Study," DRUID Working Papers 08-04, DRUID, Copenhagen Business School, Department of Industrial Economics and Strategy/Aalborg University, Department of Business Studies.

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