nep-ino New Economics Papers
on Innovation
Issue of 2009‒08‒22
three papers chosen by
Steffen Lippert
Massey University Department of Commerce

  1. Licensing probabilistic Patents and Liability Rules: The Duopoly case By Vargas Barrenechea, Martin
  2. A Welfare Analysis of Global Patent Protection in a Model with Endogenous Innovation and Foreign Direct Investment By Hitoshi Tanaka; Tatsuro Iwaisako; Koichi Futagami
  3. University Patenting in Germany before and after 2002: What Role Did the Professors' Privilege Play? By Sidonia von Ledebur; Guido Buenstorf; Martin Hummel

  1. By: Vargas Barrenechea, Martin
    Abstract: In this paper a game is used to compare the licensing of a cost reduction innovations under lost profits (LP) and unjust enrichment (UE), both damage rules that are used by courts in the calculation of damages when a patent has been infringed. The market is composed by two homogeneous firms that compete in quantities (Cournot), both firmas produces a homogeneous good. One of the firms (patent holder) develops a cost reduction innovation (drastic or non-drastic) and got a patent for this innovation. Under the shadow of probabilistic property rights, It is founded that licensing by using royalty rate is preferred compared with fixed fees, also it is observable little licensing (just big innovations). By comparing LP against UE, it is concluded that for drastic innovation the patentee and licensee are better off under LP. However social welfare is greater under UE. In the case of a non drastic innovation the results do not show a rule better than the other one.
    Keywords: innovation; law; damage rules; patent; licensing games
    JEL: D23 O34 P48 K11
    Date: 2009
  2. By: Hitoshi Tanaka (Faculty of Economics, Hokkai Gaku-en University); Tatsuro Iwaisako (Graduate School of Economics, Osaka University); Koichi Futagami (Graduate School of Economics, Osaka University)
    Abstract: This paper constructs a North-South quality ladder model in which foreign direct investment (FDI) is determined by the endogenous location choice of firms and examines analytically how strengthening patent protection in the South affects welfare in the South. Strengthening patent protection increases the Southfs welfare by enhancing innovation and FDI, but also allows the firms with patents to charge higher prices for their goods, which decreases welfare. However, the model shows that the former positive welfare effect overcomes the latter negative one, and introducing the strictest form of patent protection in the South, that is, harmonizing patent protection in the South with that in the North, may maximize welfare in the South as well as in the North.
    Keywords: foreign direct investment, innovation, intellectual property rights protection, welfare analysis
    JEL: F43 O33 O34 O40
    Date: 2009–08
  3. By: Sidonia von Ledebur (Philipps University Marburg); Guido Buenstorf (Max Planck Institute of Economics, Jena); Martin Hummel (Friedrich Schiller University Jena, School of Economics and Business Administration)
    Abstract: We examine ownership patterns of German university-invented patents before and after the abolition of the "professors' privilege" in 2002 to explore how the legal change affected patenting activities. Our data show a shift from individually-owned and firm-owned patents to university-owned patents, which becomes increasingly strong over the years. Differences in the patent experience of inventors and universities further help explain the variance in ownership patterns. Both experienced and inexperienced inventors are affected by the legal change.
    Keywords: university patenting, technology transfer, professors' privilege, Germany
    JEL: O33 O34 O38
    Date: 2009–08–12

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