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Giving away the game? The impact of the disclosure effect on the patenting decision

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  • Heger, Diana
  • Zaby, Alexandra K.

Abstract

This article explores the propensity to patent in the light of the disclosure effect. Unlike earlier approaches concerned with the patenting decision, we take into account that a disclosure effect may decrease the merits of patenting by facilitating inventing around the patent for competitors. In our theoretical model, we find that the disclosure effect - contingent on the competitive environment of the inventor - possibly has substantial negative effects on the propensity to patent. An empirical investigation of the theoretical results finds support for the proposed effects.

Suggested Citation

  • Heger, Diana & Zaby, Alexandra K., 2012. "Giving away the game? The impact of the disclosure effect on the patenting decision," ZEW Discussion Papers 12-010, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
  • Handle: RePEc:zbw:zewdip:12010
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    File URL: https://www.econstor.eu/bitstream/10419/56016/1/688585337.pdf
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    References listed on IDEAS

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    1. Erkal, Nisvan, 2005. "The decision to patent, cumulative innovation, and optimal policy," International Journal of Industrial Organization, Elsevier, pages 535-562.
    2. Paul Klemperer, 1990. "How Broad Should the Scope of Patent Protection Be?," RAND Journal of Economics, The RAND Corporation, pages 113-130.
    3. Aoki, Reiko & Spiegel, Yossi, 2009. "Pre-grant patent publication and cumulative innovation," International Journal of Industrial Organization, Elsevier, vol. 27(3), pages 333-345, May.
    4. Kamien, Morton I. & Zang, Israel, 2000. "Meet me halfway: research joint ventures and absorptive capacity," International Journal of Industrial Organization, Elsevier, vol. 18(7), pages 995-1012, October.
    5. Sudipto Bhattacharya & Sergei Guriev, 2006. "Patents vs. Trade Secrets: Knowledge Licensing and Spillover," Journal of the European Economic Association, MIT Press, vol. 4(6), pages 1112-1147, December.
    6. Yiannaka, Amalia & Fulton, Murray, 2006. "Strategic patent breadth and entry deterrence with drastic product innovations," International Journal of Industrial Organization, Elsevier, vol. 24(1), pages 177-202, January.
    7. Ai, Chunrong & Norton, Edward C., 2003. "Interaction terms in logit and probit models," Economics Letters, Elsevier, vol. 80(1), pages 123-129, July.
    8. Waterson, Michael, 1990. "The Economics of Product Patents," American Economic Review, American Economic Association, vol. 80(4), pages 860-869, September.
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    Cited by:

    1. Savin, Ivan & Egbetokun, Abiodun, 2016. "Emergence of innovation networks from R&D cooperation with endogenous absorptive capacity," Journal of Economic Dynamics and Control, Elsevier, pages 82-103.
    2. repec:gam:jsusta:v:9:y:2017:i:10:p:1808-:d:114286 is not listed on IDEAS

    More about this item

    Keywords

    Patenting decision; secrecy; disclosure requirement; patent breadth; horizontal product differentiation; circular city;

    JEL classification:

    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L24 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Contracting Out; Joint Ventures
    • O34 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital

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