IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Log in (now much improved!) to save this paper

Does fragmented or heterogeneous IP ownership stifle investments in innovation?

Listed author(s):
  • Schwiebacher, Franz
Registered author(s):

    Thickets of partially overlapping patent rights raise costs to secure IPR for innovation. Fragmented IP ownership raises coordination costs to resolve mutual blockades. Inadvertent patent infringement poses the risk of fruits from investments to be exploited. A gap in economic commitment levels may be exploited if capital-intensive innovators have more invested application-specifically than inadvertently infringed IPR owners. I study whether fragmentation or heterogeneous capital-intensities among owners of overlapping patents affect propensities to invest in innovation. I find that firms with small patent portfolios are less likely to invest in innovation if IPR is fragmented. Firms with large patent portfolios are less likely to invest in innovation if cited patent owners have smaller stocks of fixed capital. This suggests that effects of patent thickets on innovation are not evenly spread among innovating firms.

    If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

    File URL: https://www.econstor.eu/bitstream/10419/88119/1/772111766.pdf
    Download Restriction: no

    Paper provided by ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research in its series ZEW Discussion Papers with number 13-096.

    as
    in new window

    Length:
    Date of creation: 2013
    Handle: RePEc:zbw:zewdip:13096
    Contact details of provider: Postal:
    L 7,1; D - 68161 Mannheim

    Phone: +49/621/1235-01
    Fax: +49/621/1235-224
    Web page: http://www.zew.de/
    Email:


    More information through EDIRC

    References listed on IDEAS
    Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

    as
    in new window


    1. Joseph Farrell & Carl Shapiro, 2008. "How Strong Are Weak Patents?," American Economic Review, American Economic Association, vol. 98(4), pages 1347-1369, September.
    2. Clark, Derek J. & Konrad, Kai A., 2008. "Fragmented property rights and incentives for R&D," Munich Reprints in Economics 22089, University of Munich, Department of Economics.
    3. Pol Antràs, 2003. "Firms, Contracts, and Trade Structure," The Quarterly Journal of Economics, Oxford University Press, vol. 118(4), pages 1375-1418.
    4. Harhoff, Dietmar & von Graevenitz, Georg & Wagner, Stefan, 2013. "Conflict Resolution, Public Goods and Patent Thickets," CEPR Discussion Papers 9468, C.E.P.R. Discussion Papers.
    5. Mark A. Lemley & Carl Shapiro, 2005. "Probabilistic Patents," Journal of Economic Perspectives, American Economic Association, vol. 19(2), pages 75-98, Spring.
    6. Josh Lerner, 2003. "150 Years of Patent Protection," Levine's Working Paper Archive 618897000000000587, David K. Levine.
    7. Jacobides, Michael G. & Knudsen, Thorbjorn & Augier, Mie, 2006. "Benefiting from innovation: Value creation, value appropriation and the role of industry architectures," Research Policy, Elsevier, vol. 35(8), pages 1200-1221, October.
    8. Marco Ceccagnoli & Stuart J.H. Graham & Matthew J. Higgins & Jeongsik Lee, 2010. "Productivity and the role of complementary assets in firms' demand for technology innovations," Industrial and Corporate Change, Oxford University Press, vol. 19(3), pages 839-869, June.
    9. Daron Acemoglu & Philippe Aghion & Rachel Griffith & Fabrizio Zilibotti, 2004. "Vertical Integration and Technology: Theory and Evidence," NBER Working Papers 10997, National Bureau of Economic Research, Inc.
    10. James Bessen & Robert M. Hunt, 2004. "An empirical look at software patents," Working Papers 03-17, Federal Reserve Bank of Philadelphia.
    11. Reitzig, Markus & Henkel, Joachim & Heath, Christopher, 2007. "On sharks, trolls, and their patent prey--Unrealistic damage awards and firms' strategies of "being infringed"," Research Policy, Elsevier, vol. 36(1), pages 134-154, February.
    12. Joshua S. Gans & David H. Hsu & Scott Stern, 2002. "When Does Start-Up Innovation Spur the Gale of Creative Destruction?," RAND Journal of Economics, The RAND Corporation, vol. 33(4), pages 571-586, Winter.
    13. Jerry R. Green & Suzanne Scotchmer, 1995. "On the Division of Profit in Sequential Innovation," RAND Journal of Economics, The RAND Corporation, vol. 26(1), pages 20-33, Spring.
    14. Anand, Bharat N & Khanna, Tarun, 2000. "The Structure of Licensing Contracts," Journal of Industrial Economics, Wiley Blackwell, vol. 48(1), pages 103-135, March.
    15. Alfonso Gambardella & Paola Giuri & Alessandra Luzzi, 2006. "The Market for Patents in Europe," LEM Papers Series 2006/04, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    16. Joskow, Paul L, 1991. "The Role of Transaction Cost Economics in Antitrust and Public Utility Regulatory Policies," Journal of Law, Economics and Organization, Oxford University Press, vol. 7(0), pages 53-83, Special I.
    17. Ashish Arora & Marco Ceccagnoli, 2006. "Patent Protection, Complementary Assets, and Firms' Incentives for Technology Licensing," Management Science, INFORMS, vol. 52(2), pages 293-308, February.
    18. Ashish Arora & Andrea Fosfuri & Alfonso Gambardella, 2004. "Markets for Technology: The Economics of Innovation and Corporate Strategy," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262511819, September.
    19. Russell Cooper & John Haltiwanger & Laura Power, 1995. "Machine Replacement and the Business Cycle: Lumps and Bumps," Papers 0062, Boston University - Industry Studies Programme.
    20. Caves, Richard E. & Bradburd, Ralph M., 1988. "The empirical determinants of vertical integration," Journal of Economic Behavior & Organization, Elsevier, vol. 9(3), pages 265-279, April.
    21. Harhoff, Dietmar & von Graevenitz, Georg & Wagner, Stefan, 2008. "Incidence and Growth of Patent Thickets - The Impact of Technological Opportunities and Complexity," CEPR Discussion Papers 6900, C.E.P.R. Discussion Papers.
    22. James Bessen & Eric Maskin, 2009. "Sequential innovation, patents, and imitation," RAND Journal of Economics, RAND Corporation, vol. 40(4), pages 611-635.
    23. James E. Bessen & Michael J. Meurer, 2006. "Patent Litigation with Endogenous Disputes," American Economic Review, American Economic Association, vol. 96(2), pages 77-81, May.
    24. Pakes, Ariel S, 1986. "Patents as Options: Some Estimates of the Value of Holding European Patent Stocks," Econometrica, Econometric Society, vol. 54(4), pages 755-784, July.
    25. von Graevenitz, Georg & Wagner, Stefan & Harhoff, Dietmar, 2011. "How to measure patent thickets--A novel approach," Economics Letters, Elsevier, vol. 111(1), pages 6-9, April.
    26. repec:are:cudare:925 is not listed on IDEAS
    27. Ingemar Dierickx & Karel Cool, 1989. "Asset Stock Accumulation and Sustainability of Competitive Advantage," Management Science, INFORMS, vol. 35(12), pages 1504-1511, December.
    28. Scott Shane, 2001. "Technology Regimes and New Firm Formation," Management Science, INFORMS, vol. 47(9), pages 1173-1190, September.
    29. Joshua S. Gans & David H. Hsu & Scott Stern, 2007. "The Impact of Uncertain Intellectual Property Rights on the Market For Ideas: Evidence From Patent Grant Delays," NBER Working Papers 13234, National Bureau of Economic Research, Inc.
    30. Gregory D. Graff & Gordon C. Rausser & Arthur A. Small, 2003. "Agricultural Biotechnology's Complementary Intellectual Assets," The Review of Economics and Statistics, MIT Press, vol. 85(2), pages 349-363, May.
    31. Müller, Elisabeth & MacGarvie, Megan J. & Cockburn, Iain M., 2008. "Patent Thickets, Licensing and Innovative Performance," ZEW Discussion Papers 08-101, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
    32. Suma Athreye & John Cantwell, 2005. "Creating Competition? Globalisation and the emergence of new technology producers," Open Discussion Papers in Economics 52, The Open University, Faculty of Social Sciences, Department of Economics.
    33. Gans, Joshua S. & Stern, Scott, 2003. "The product market and the market for "ideas": commercialization strategies for technology entrepreneurs," Research Policy, Elsevier, vol. 32(2), pages 333-350, February.
    34. James Bessen & Jennifer L. Ford & Michael J. Meurer, 2011. "The Private and Social Costs of Patent Trolls," Working Papers 1103, Research on Innovation.
    35. Nancy T. Gallini, 2002. "The Economics of Patents: Lessons from Recent U.S. Patent Reform," Journal of Economic Perspectives, American Economic Association, vol. 16(2), pages 131-154, Spring.
    36. Deepak Hegde & David C. Mowery & Stuart J. H. Graham, 2009. "Pioneering Inventors or Thicket Builders: Which U.S. Firms Use Continuations in Patenting?," Management Science, INFORMS, vol. 55(7), pages 1214-1226, July.
    37. Suzanne Scotchmer, 1991. "Standing on the Shoulders of Giants: Cumulative Research and the Patent Law," Journal of Economic Perspectives, American Economic Association, vol. 5(1), pages 29-41, Winter.
    38. Alberto Galasso & Mark Schankerman, 2010. "Patent thickets, courts, and the market for innovation," RAND Journal of Economics, RAND Corporation, vol. 41(3), pages 472-503.
    39. Nagaoka, Sadao & Kwon, Hyeog Ug, 2006. "The incidence of cross-licensing: A theory and new evidence on the firm and contract level determinants," Research Policy, Elsevier, vol. 35(9), pages 1347-1361, November.
    40. Cynthia A. Montgomery & Birger Wernerfelt, 1988. "Diversification, Ricardian Rents, and Tobin's q," RAND Journal of Economics, The RAND Corporation, vol. 19(4), pages 623-632, Winter.
    41. Lampe, Ryan & Moser, Petra, 2010. "Do Patent Pools Encourage Innovation? Evidence from the Nineteenth-Century Sewing Machine Industry," The Journal of Economic History, Cambridge University Press, vol. 70(04), pages 898-920, December.
    42. Sakakibara, Mariko & Branstetter, Lee, 2001. "Do Stronger Patents Induce More Innovation? Evidence from the 1988 Japanese Patent Law Reforms," RAND Journal of Economics, The RAND Corporation, vol. 32(1), pages 77-100, Spring.
    43. Alvin K. Klevorick & Richard C. Levin & Richard R. Nelson & Sidney G. Winter, 1993. "On the Sources and Significance of Interindustry Differences in Technological Opportunities," Cowles Foundation Discussion Papers 1052, Cowles Foundation for Research in Economics, Yale University.
    44. Siebert, Ralph Bernd & Graevenitz, Georg von, 2010. "Licensing in the Patent Thicket - Timing and Benefits," MPRA Paper 24007, University Library of Munich, Germany.
    45. Markus Reitzig & Joachim Henkel & Ferdinand Schneider, 2010. "Collateral damage for R&D manufacturers: how patent sharks operate in markets for technology," Industrial and Corporate Change, Oxford University Press, vol. 19(3), pages 947-967, June.
    46. Rosemarie Ham Ziedonis, 2004. "Don't Fence Me In: Fragmented Markets for Technology and the Patent Acquisition Strategies of Firms," Management Science, INFORMS, vol. 50(6), pages 804-820, June.
    47. Iain M. Cockburn & Megan J. MacGarvie, 2011. "Entry and Patenting in the Software Industry," Management Science, INFORMS, vol. 57(5), pages 915-933, May.
    48. Rothaermel, Frank T., 2001. "Complementary assets, strategic alliances, and the incumbent's advantage: an empirical study of industry and firm effects in the biopharmaceutical industry," Research Policy, Elsevier, vol. 30(8), pages 1235-1251, October.
    49. Hall, Bronwyn H & Ziedonis, Rosemarie Ham, 2001. "The Patent Paradox Revisited: An Empirical Study of Patenting in the U.S. Semiconductor Industry, 1979-1995," RAND Journal of Economics, The RAND Corporation, vol. 32(1), pages 101-128, Spring.
    50. Ashish Arora & Robert P. Merges, 2004. "Specialized supply firms, property rights and firm boundaries," Industrial and Corporate Change, Oxford University Press, vol. 13(3), pages 451-475, June.
    51. James Bessen & Michael J. Meurer, 2005. "The Patent Litigation Explosion," Working Papers 0501, Research on Innovation.
    52. Catherine Tucker, 2012. "Patent Trolls and Technology Diffusion," NBER Chapters, in: Standards, Patents and Innovations National Bureau of Economic Research, Inc.
    53. Brian S. Silverman, 1999. "Technological Resources and the Direction of Corporate Diversification: Toward an Integration of the Resource-Based View and Transaction Cost Economics," Management Science, INFORMS, vol. 45(8), pages 1109-1124, August.
    54. Bessen, James, 2004. "Holdup and licensing of cumulative innovations with private information," Economics Letters, Elsevier, vol. 82(3), pages 321-326, March.
    55. Ingemar Dierickx & Karel Cool, 1989. "Asset Stock Accumulation and the Sustainability of Competitive Advantage: Reply," Management Science, INFORMS, vol. 35(12), pages 1514-1514, December.
    Full references (including those not matched with items on IDEAS)

    This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

    When requesting a correction, please mention this item's handle: RePEc:zbw:zewdip:13096. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (ZBW - German National Library of Economics)

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If references are entirely missing, you can add them using this form.

    If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.