We examine various conceptual issues raised by the “patent wars” that have occurred in recent years in telecommunications. We conclude that “patent wars” are the natural consequence of the multi-invention nature and massive growth of the industry and the probabilistic and...

We show that a two-part tariff licensing contract is always optimal to the insider patentee in spatial models irrespective of the size of the innovation or any pre-innovation cost asymmetries. The result provides a simple justification of the prevalence of two-part tariff licensing contracts in...