Fragmented property rights and R&D competition

Derek J. Clark and Kai Konrad

Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems from Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich

Abstract: Where product innovation requires several complementary patents, fragmented property rights can be a factor that limits firms’ willingness to invest in the development and commercialization of new products. This paper studies multiple simultaneous R&D contests for complementary patents and how they interact with patent portfolios that firms may have acquired already. We also consider how this interaction and the intensity of the contests depends on the type of patent trade regimes and the product market equilibria that result from these regimes. We solve for the contest equilibria and show that the multiple patent product involves an important hold-up problem that considerably reduces the overall contest effort.

Keywords: fragmented property rights; patents; contests; hold-up; R&D; patent pools; licensing (search for similar items in EconPapers)
JEL-codes: D44 (search for similar items in EconPapers)
Date: 2006-06
New Economics Papers: this item is included in nep-com, nep-ino, nep-mic and nep-tid
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:trf:wpaper:123

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