Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/81526
Authors: 
Färnstrand Damsgaard, Erika
Year of Publication: 
2009
Series/Report no.: 
IFN Working Paper 792
Abstract: 
This paper analyzes the effect of an increase in patent scope on R&D and innovation. It presents a model where patent scope affects an entrant firm's technology choice and thereby creates a trade-off between R&D investments and wasteful duplication of R&D. The model predicts that an increase in patent scope can increase the probability of innovation if the incumbent’s profit increase from innovation is large and the patented technology has a small advantage over the alternative technology. However, when the model is extended to Stackelberg competition or licensing, the benefit of a broad patent scope to a large extent disappears.
Subjects: 
Innovation
Patents
Patent policy
Licensing
JEL: 
K20
L51
Document Type: 
Working Paper

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