innovation strategy reflects the patent race motives and hedging demand of defendant firms against future litigation. These real …Using novel inter-firm patent litigation data, we show that defendant firms become financially constrained, reduce … innovation activity, and shift toward exploitative innovation leveraging past experience and expertise. The exploitative …

difference between the products. From the perspective of public policy, it is clarified that the policy on patent scope cannot … yield the first-best result in terms of the speed of innovation, and the welfare analysis shows that social welfare is … higher when the conflict is settled via cross licensing. However, the weak protection on patent rights, which is shown to …

We construct a tractable general equilibrium model of cumulative innovation and growth, in which new ideas strictly … lower than the social planner's benchmark, which suggests a role for patent policy. We focus on a “non-infringing inventive … the rate of innovation, as well as a separate optimal required inventive step that maximizes welfare, with the former …

This paper investigates the entry decision of a firm into a market that is protected by a patent. It shows how entrants … information asymmetry that arises due to the fact that patent strengths are private information. The paper analyses the incumbent … damages doctrine reduces the incentives for an incumbent to patent excessively …

patentability standards at PTOs (Patent and Trademark Offices awarding so-called bad patents), not only “false innovators” have the … chance of being granted patents but also, and more interestingly, “true innovators” are forced to patent more intensively … distortions caused by bad patents. Moreover, we show that introducing a two-tiered patent system is unlikely to improve market …

Critics claim that patent screening is ineffective, granting low-quality patents that impose unnecessary social costs …. We develop an integrated framework, involving patent office examination, fees, and endogenous validity challenges in the … courts, to study patent screening both theoretically and quantitatively. In our model, some inventions require the patent …

initial inventor on the one hand and overall innovation incentives on the other hand. We find that incomplete patent … protection can positively affect overall innovation incentives while maintaining the advantageousness of patent protection over …From the viewpoint of an innovator a patent is a tradeoff between the right to exclude others from using the patented …

In this paper, we study the determinants of patent quality and volume of patent applications when inventors care about … perceived patent quality. We analyze the effects of various policy reforms, specifically, a proposal to establish a two …-tiered patent system. In the two-tiered system, applicants can choose between a regular patent and a more costly, possibly more …

We present a model of process innovation that offers an explanation for the negative relationship between patent … favor imitation. Since imitation is discouraged for strong levels of patent protection, we find that R&D investment is often … maximized for an intermediate protection level. In addition, an increase in patent protection can enhance the innovator …

We show that the common wisdom suggesting higher investment in innovation under a stronger patent protection may not be … slope of the marginal cost of undertaking innovation is moderate, investment in innovation is maximised at a patent … innovation. We also show that welfare is maximised neither at the strongest patent protection nor at the weakest patent …