In this paper, we consider products that are composed of distinct components that can be shared with rival firms through licensing agreements. In contrast to the standard licensing settings in which firms make binary choices (whether to license or not), the innovator decides on the set of...

In this article we examine the interaction between firms' product and process innovation decisions and the role patent policy can play in directing technological change toward a socially efficient mix of innovations. Product innovation is a variant on a pioneer's new product; process innovation...

A growing body of research uses patent citations to analyze economic phenomena, and many of these papers are interested in the distribution of citations over the life of a patent. However, this question leads directly to the age-year-cohort identification problem, i.e. co-linearity between the...

We study the incentives of a product innovator to license its product partially to a potential entrant. In a duopolistic setting we consider product design of a modular nature, which enables the incumbent to license some modules of its innovation. Competition is characterized by the size of the...

Current controversies over patent policy place standard-setting organizations (SSOs) on a collision course with antitrust law. Recent theoretical research conjectures that, in an SSO, patent owners can “hold up” patent users in the sense of demanding high royalties for a patented input after...

Patent law is under-theorized in the sense that the predominating incentive-based justifications cannot by themselves adequately explain empirical evidence on patenting gathered by research economists. This article provides an alternative justification for patent law based on private transaction...

In this paper, we consider products that are composed of distinct components that can be shared with rival firms through licensing agreements. In contrast to the standard licensing settings in which firms make binary choices (whether to license or not), the innovator decides on the set of...

An extensive literature has investigated the effect of market structure on innovation. A persistent concern is that market structure may be endogenous to innovation. Firms may choose to merge so as to capture information spillovers or they may choose to merge so as to dampen competition in...

Most patent pools are formed in the shadow of patent litigation as an attempt to settle disputes in regard to conflicting infringement claims and the validity of patents. To reflect this reality, I develop a simple framework to analyze the incentives to form a patent pool or engage in...