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Patent Protection with Cooperative R&D Option

  • Che, Xiaogang
  • Yang, Yibai
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    We investigate R&D incentive under patent protection with cooperation option. Chowdhury [Economics Letters, 2005, 89(1), 120-126] claims that patent protection may decrease R&D incentive when the tournament effect (TE) is negative. However, We show that patent protection in the presence of R&D cooperation option always increases R&D incentive. In addition, to increase R&D incentive, this option strictly dominates imitation and may dominate royalty licensing under patent protection, introduced by Mukherjee [Economics Letters, 2006, 93(2), 196-201].

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    File URL: http://mpra.ub.uni-muenchen.de/19436/1/MPRA_paper_19436.pdf
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    Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 19436.

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    Date of creation: 19 Dec 2009
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    Handle: RePEc:pra:mprapa:19436
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    1. Suzumura, Kotaro, 1992. "Cooperative and Noncooperative R&D in an Oligopoly with Spillovers," American Economic Review, American Economic Association, vol. 82(5), pages 1307-20, December.
    2. Kamien, Morton I & Muller, Eitan & Zang, Israel, 1992. "Research Joint Ventures and R&D Cartels," American Economic Review, American Economic Association, vol. 82(5), pages 1293-306, December.
    3. Che, Xiaogang & Yang, Yibai, 2009. "Patent Protection with Licensing," MPRA Paper 19438, University Library of Munich, Germany.
    4. Chowdhury, Prabal Roy, 2005. "Patents and R&D: The tournament effect," Economics Letters, Elsevier, vol. 89(1), pages 120-126, October.
    5. Mukherjee, Arijit, 2006. "Patents and R&D with imitation and licensing," Economics Letters, Elsevier, vol. 93(2), pages 196-201, November.
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