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on Intellectual Property Rights |
| By: | Pollock, Rufus |
| Abstract: | The optimal level for copyright has been a matter for extensive debate over the last decade. This paper contributes several new results on this issue divided into two parts. In the first, a parsimonious theoretical model is used to prove several novel propositions about the optimal level of protection. Specifically, we demonstrate that (a) optimal copyright is likely to fall as the production costs of `originals' decline (for example as a result of digitization) and that (b) the optimal level of copyright will, in general, fall over time. The second part of the paper focuses on the specific case of copyright term. Using a simple model we characterise optimal term as a function of a few key parameters. We estimate this function using a combination of new and existing data on recordings and books and find an optimal term of around fifteen years. This is substantially shorter than any current copyright term and implies that existing copyright terms are too long. |
| Keywords: | Copyright; Intellectual Property; Copyright Term; Technological Change |
| JEL: | O34 O31 L10 |
| Date: | 2007–02 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:5024&r=ipr |
| By: | Hoekman, Bernard; Saggi, Kamal |
| Abstract: | Using a repeated game approach, this paper models a North-South trade agreement under which North offers South improved market access (via a tariff reduction) if South agrees to prevent local imitation by strengthening its protection of intellectual property rights (IPRs). We show that such an agreement arises in equilibrium if South's imitative capacity is neither too high nor too low. The paper also considers a scenario where Southern protection of IPRs is induced via a North-South transfer. A comparison of the two instruments shows that one instrument does not unambiguously dominate the other in terms of sustaining cooperation. We also analyze whether and how the availability of the second instrument affects cooperation given that one instrument is already available. |
| Keywords: | Intellectual Property Rights; international cooperation; market Access; tariffs; trade agreements; Transfers |
| JEL: | F12 F13 L41 O19 |
| Date: | 2007–09 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:6460&r=ipr |
| By: | Nicholas Economides |
| Date: | 2007 |
| URL: | http://d.repec.org/n?u=RePEc:ste:nystbu:07-24&r=ipr |
| By: | Bronwyn H. Hall; Grid Thoma; Salvatore Torrisi |
| Abstract: | This paper provides novel empirical evidence on the private value of patents and R&D in European firms during the period 1991-2004. We explore the relationship between firm's stock market value, patents, and "quality"-weighted patents issued by the European Patent Office (EPO) and the US Patent and Trademark Office (USPTO). We find that Tobin's q is positively and significantly associated with R&D and patent stocks, but that only those patents taken out in both patent offices or at the USPTO alone seem to be valued. Either forward citations or a composite quality indicator based on forward citations, family size and the number of technical fields covered by the patent are modestly informative for value. Software patents account for a rising share of total patents in the USPTO and EPO. Moreover, some scholars of innovation and intellectual property rights argue that software and business methods patents on average are of poor quality and that these patents are applied for merely to build portfolios rather than for protection of real inventions. We found that such patents are considerably more valuable than ordinary patents, especially if they are taken out in the U.S. However their quality indicators are no more valuable than those of other patents, suggesting that their primary purpose may be to increase the size of the patent portfolio. |
| JEL: | D24 G32 L86 O31 O34 |
| Date: | 2007–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:13426&r=ipr |
| By: | Griffith, Rachel; Lee, Sokbae; Van Reenen, John |
| Abstract: | We examine the 'home bias' of international knowledge spillovers as measured by the speed of patent citations (i.e. knowledge spreads slowly over international boundaries). We present the first compelling econometric evidence that the geographical localization of knowledge spillovers has fallen over time, as we would expect from the dramatic fall in communication and travel costs. Our proposed estimator controls for correlated fixed effects and censoring in duration models and we apply it to data on over two million citations between 1975 and 1999. Home bias declines substantially when we control for fixed effects: there is practically no home bias for the more 'modern' sectors such as pharmaceuticals and information/communication technologies. |
| Keywords: | fixed effects; home bias; knowledge spillovers; patent citations |
| JEL: | F23 O32 O33 |
| Date: | 2007–09 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:6435&r=ipr |
| By: | Pollock, Rufus |
| Abstract: | An extensive empirical literature indicates that returns from innovation are appropriated primarily via mechanisms other than formal intellectual property rights -- and that `imitation' is itself a costly activity. However most theory assumes the pure nonrivalry of `ideas' with its implication that, in the absence of intellectual property, innovation (and welfare) is zero. This paper introduces a formal model of innovation based on imperfect competition in which imitation is costly and an innovator has a first-mover advantage. Without intellectual property, a significant amount of innovation still occurs and welfare may actually be higher than with intellectual property. |
| Keywords: | Innovation; Imperfect Competition; Intellectual Property; Imitation |
| JEL: | L5 O3 K3 |
| Date: | 2006–09 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:5025&r=ipr |
| By: | Pollock, Rufus |
| Abstract: | With cumulative innovation and imperfect information about the value of innovations, intellectual property rights can result in hold-up and therefore it may be better not to have them. Extending the basic cumulative innovation model to include `sampling' by second-stage firms, we find that the lower the cost of sampling, or the larger the differential between high and low value second-stage innovations, the more likely it is that a regime without intellectual property rights will be preferable. Thus, technological change which reduces the cost of encountering and trialling new `ideas' implies a reduction in the socially optimal level of rights such as patent and copyright. |
| Keywords: | Cumulative Innovation; Hold-Up; Sampling; Intellectual Property |
| JEL: | L5 O3 K3 |
| Date: | 2006–01–24 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:5022&r=ipr |
| By: | Eugen Kovac; Viatcheslav Vinogradov; Kresimir Zigic |
| Abstract: | We build a dynamic duopoly model that accounts for the empirical observation of monopoly persistence in the long run. More specifically, we analyze the conditions under which it is optimal for the market leader in an initially duopoly setup to undertake pre-emptive R&D investment ("strategic preda- tion") that eventually leads to the exit of the follower firm. The follower is assumed to benefit from the innovative activities of the leader through R&D spillovers. The novel feature of our approach is that we introduce an explicit dynamic model and contrast it with its static counterpart. Contrary to the predictions of the static model, strategic predation that leads to the persis- tence of monopoly is in general the optimal strategy to pursue in a dynamic framework when spillovers are not large. |
| Keywords: | Dynamic duopoly, R&D spillovers, persistence of monopoly, strate- gic predation, accommodation. |
| JEL: | L12 L13 L41 |
| Date: | 2007–01 |
| URL: | http://d.repec.org/n?u=RePEc:cer:papers:wp316&r=ipr |
| By: | David Popp; Tamara Hafner; Nick Johnstone |
| Abstract: | In the late 1980s and early 1990s, concern over dioxin in both paper products and wastewater led to the development of techniques that reduced the use of chlorine in the pulp industry. Both regulatory and consumer pressure motivated this change. We use patent data to examine the evolution of two completing bleaching technologies in five major paper-producing countries, both of which reduce the use of chlorine in the pulping process. By the end of the 1990s, nearly all pulp production in these countries used one of these technologies. Unlike other papers using patents to study environmentally-friendly innovation, we focus on a process innovation, rather than on end-of-the-pipe solutions to pollution. Moreover, while previous studies emphasize the importance of regulation for inducing innovation, here we find substantial innovation occurring before regulations were in place. Instead, pressure from consumers to reduce the chlorine content of paper drives the first round of innovation. However, while some companies choose to adopt these technologies in response to consumer pressure, not all firms will differentiate their product in this way. Thus, governments need to regulate if their goal is broad diffusion of the environmental technology. |
| JEL: | O31 O33 Q53 Q55 |
| Date: | 2007–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:13439&r=ipr |