Patent Length and the Rate of Innovation

Horowitz, Andrew W.; Lai, Edwin L.-C.

doi:10.2307/2527311

Cited by 112 publications

(58 citation statements)

References 13 publications

Supporting

Mentioning

Contrasting

Unclassified

Order By: Relevance

“…An early theoretical argument for such a relationship between IPR protection in the form of patent length and the expected value of resulting inventions was provided by Horwitz and Lai (1996). Sakakibara and Brensetter (2001) have analyzed Japanese evidence on this issue, based on the impact of patent reforms.…”

Section: Discussionmentioning

confidence: 99%

Patents vs. Trade Secrets: Knowledge Licensing and Spillover

Bhattacharya

Guriev

2006

Journal of the European Economic Association

View full text Add to dashboard Cite

We develop a model of two-stage cumulative research and development (R&D), in which one Research Unit (RU) with an innovative idea bargains to license her nonverifiable interim knowledge exclusively to one of two competing Development Units (DUs) via one of two alternative modes: an Open sale after patenting this knowledge, or a Closed sale in which precluding further disclosure to a competing DU requires the RU to hold a stake in the licensed DU's post-invention revenues. Both modes lead to partial leakage of RU's knowledge from its description, to the licensed DU alone in a closed sale, and to both DUs in an open sale. We find that higher levels of interim knowledge are more likely to be licensed via closed sales. If the extent of leakage is lower, more RUs choose open sales, generating a non-monotonic relationship between the strength of Intellectual Property Rights (IPR) and aggregate R&D expenditures and the overall likelihood of development by either DU.JEL Codes: D23, O32, O34.

show abstract

Section: Discussionmentioning

confidence: 99%

Patents vs. Trade Secrets: Knowledge Licensing and Spillover

Bhattacharya

Guriev

2006

Journal of the European Economic Association

View full text Add to dashboard Cite

show abstract

“…Nonmonotonic R&D effort is also found by Horowitz and Lai (1996), Choi (1998), and Takalo (1998) but for different reasons. 15 …”

Section: Equilibriummentioning

confidence: 76%

Patents, Secrets, and the First Inventor Defense

Denicolò

Franzoni

2001

SSRN Journal

View full text Add to dashboard Cite

We analyze optimal patent design when innovators can rely on secrecy to protect their innovations. Secrecy provides a temporary monopoly, which terminates when the secret leaks out or the innovation is duplicated. We find conditions under which the optimal policy is to induce the first innovator to patent. Furthermore, we derive the optimal scope of the rights conferred to late innovators. We show that if the patent life can be suitably set, late innovators should be allowed to patent and exclude first inventors who have relied on secrecy.JEL Nos: L00 (Industrial organization), O31, O34 (Intellectual property rights).

show abstract

“…In a di¤erent set-up, Horowitz and Lai (1996) consider a technological lag in the sense that imitators can not copy the most advanced products; however, this lag is a result of legal binding through the patents of a certain length, and not a consequence of imitators'optimization given the copying technology. They analyze the case of one country in autarky, so it does not apply closely to the problem here, but nevertheless raises an important issue of patent policy (patent length) and its impact on both the size and the frequency of innovation.…”

Section: Literaturementioning

confidence: 99%

Innovation and imitation in a model of North–South trade

Borota

2012

Journal of International Economics

View full text Add to dashboard Cite

This paper analyzes a model of North-South trade with endogenous R&D processes in both regions. North conducts innovating R&D which results in development of new, improved quality varieties. South is involved only in copying at a certain lag behind the North on the quality (product) scale. The question of interest is the impact of trade and IPR protection on the intensive margin of innovation (size of quality jumps) and the extensive margin of imitation (distance in quality, i.e. quality lag of the South) in a steady-state equilibrium. Furthermore, we attempt to derive the growth and welfare e¤ects of trade and IPR policy and to provide possible answers to some questions brought by globalization. Three alternative scenarios are considered: autarky case as a benchmark, free trade case with information protection, and …nally, restricted trade case where we introduce patents of …nite length that insure a particular form of international protection. We …nd that opening to trade increases the growth rate of both regions while it also results in larger lag in the quality level in the South. Furthermore, when comparing the e¤ects of di¤erent IPR protection tools in the trading world, we …nd di¤erences in the magnitude of the e¤ects on the variables of interest and also different direction of the change in the relative purchasing power which may even reverse the change in relative welfare when patent length is used as the IPR protection tool.However, common for both policies is that stronger protection decreases world growth rate and increases the quality lag of the South behind the North.

show abstract

Patent Length and the Rate of Innovation

Cited by 112 publications

References 13 publications

Patents vs. Trade Secrets: Knowledge Licensing and Spillover

Patents vs. Trade Secrets: Knowledge Licensing and Spillover

Patents, Secrets, and the First Inventor Defense

Innovation and imitation in a model of North–South trade

Contact Info

Product

Resources

About