Optimal Global Patent Design

The optimal patent breadth and length is derived for an innovating and a non-innovating country in the presence of imitation. It is found that the innovating country chooses stronger patent protection than the non-innovating country. These patents are compared to the optimal global patent design and it is found they are too weak from a global perspective. Finally, it is shown that the innovating country is unambiguously better off, while the non-innovating country may be worse off with the optimal global patent design