nep-ind New Economics Papers
on Industrial Organization
Issue of 2013‒06‒30
two papers chosen by
Kwang Soo Cheong
Johns Hopkins University

  1. Imitation versus Innovation Costs: Patent policies under common patent length By ICHIDA Toshihiro
  2. Reverse causality in the R&D – patents relationship: an interpretation of the innovation persistence By Baraldi, Anna Laura; Cantabene, Claudia; Perani, Giulio

  1. By: ICHIDA Toshihiro
    Abstract: This paper investigates the interaction between innovation and imitation costs for heterogeneous ideas (industries). It analyzes the effect of various patent-related policies under the common patent length across different industries. It also looks at a policy that will strengthen trade secrets such as the Soleau envelope policy. Under the common term of patent with moderate assumption about the joint distribution of costs, the model predicts the existence of imitating products which are successfully invented around the original patent.
    Date: 2013–06
  2. By: Baraldi, Anna Laura; Cantabene, Claudia; Perani, Giulio
    Abstract: Starting from the failure of the R&D-patents traditional relationship, when time-series and/or within industry dimensions are included in the empirical analysis, the present work tries to contribute to the empirical literature in two directions. Firstly, it perform a Granger causality test on the theoretical presumption of a reverse patents→R&D link as an explanation of the failure of the traditional relationship. Second, assuming the reverse patents-R&D causality, we test and interpret the lag structure of such a relationship as showing the effective patent life which firms expect in the two Schumpeterian patterns of innovations they belong to. To the light of the effective patent life, we offer a further explanation of innovation persistence which overturns the findings of the existing literature on persistence.
    Keywords: R&D, patents, innovation persistence, Granger causality
    JEL: C2 O3 O30
    Date: 2013–05–01

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