nep-ipr New Economics Papers
on Intellectual Property Rights
Issue of 2012‒05‒02
four papers chosen by
Roland Kirstein
Otto von Guericke University Magdeburg

  1. Crowdsourcing patent application review to capitalize on innovation By Ghafele, Roya; Gibert, Benjamin; DiGiammarino, Paul
  2. An Experiment on Protecting Intellectual Property By Joy A. Buchanan; Bart J. Wilson
  3. Patent Oppositions as Competitive Tools: An Analysis of the Major Players in the European Market of White Goods By Alessandro STERLACCHINI
  4. Pharmaceutical prices under regulation: Tiered co-payments and reference pricing in Germany By Herr, Annika; Suppliet, Moritz

  1. By: Ghafele, Roya; Gibert, Benjamin; DiGiammarino, Paul
    Abstract: Worldwide filings of patent applications and the ensuing invalidation requests have seen staggering growth over the last decade. The result is increasing patent backlog, deteriorating patent quality and an uncertain economic environment. Patent application review is an integral part of the examination procedures undertaken by patent offices before a patent grant is given. Prior art search is a complex and time consuming part of this process. Crowdsourcing this critical stage is a valuable opportunity to render the patent application review process more efficient. This paper describes the crowdsourcing phenomenon and then details how it can aid patent review. The open source review pilot projects of the USPTO and JPO are presented in order to assess the potential of opening prior art search to the wider community of experts and practitioners. Public-private partnerships between patent offices and companies managing online review communities are proposed as a valuable opportunity to leverage the benefits of open review while providing sufficient incentives and quality assurances to yield useful contributions.
    Keywords: Patent application review; prior art search; crowdsourcing; public-private partnerships; patent quality
    JEL: O38 O34
    Date: 2011–06
  2. By: Joy A. Buchanan (Interdisciplinary Center for Economic Science, George Mason University); Bart J. Wilson (Economic Science Institute, Chapman University)
    Abstract: We conduct a laboratory experiment to explore whether the protection of intellectual property (IP) incentivizes people to create non-rivalrous knowledge goods, foregoing the production of other rivalrous goods. In the contrasting treatment with no IP protection, participants are free to resell and remake non-rivalrous knowledge goods originally created by others. We find that creators reap substantial profits when IP is protected and that rampant pirating is not uncommon when there is no IP protection. But most importantly, we find that IP protection in and of itself is neither necessary nor sufficient for generating wealth from the discovery of knowledge goods.
    Keywords: intellectual property, experimental economics
    JEL: C92 D89 K39
    Date: 2012
  3. By: Alessandro STERLACCHINI (Universit… Politecnica delle Marche, Dipartimento di Scienze Economiche e Sociali)
    Abstract: This paper examines the role and determinants of patent oppositions between the main competitors in a given industry. Differently from previous studies, it is not concerned with high-tech firms but considers the major players in the European market of white goods. Thus, we are dealing with a medium-tech, scale intensive industry which, during the last two decades, has been characterised by a stagnating demand and decreasing unit values. As a result, the level of competition has increased, especially in terms of product quality and innovations. Among the consequences of that, the leading companies in Europe have not only intensified their patenting activities but also the usage of oppositions against the patents of direct competitors. By considering 961 patents granted by the EPO to the above companies over the period 2000-2005, the paper shows, among other things, that the probability of receiving an opposition from industry rivals does not depend on the patent quality or value. Accordingly, it contends that, at least in the industries of this kind, the extent and direction of patent oppositions are mainly associated with idiosyncratic corporate characteristics and strategies.
    Keywords: Patent oppositions, Strategic patenting, White good industry
    JEL: L68 O34
    Date: 2012–04
  4. By: Herr, Annika; Suppliet, Moritz
    Abstract: Many countries with national health care providers and health insurances regulate the market for pharmaceuticals to steer drug demand and to control expenses. For example, they introduce reference pricing or tiered co-payments to enhance drug substitution and competition. Since 2006, Germany follows an innovative approach by differentiating drug co-payments by the drug's price relative to its reference price. In this two-tier system, prescription drugs are completely exempted from co-payments if their prices undercut a certain price level relative to the reference price. We identify the effect of the policy on the prices of all affected prescription drugs and differentiate the analysis by firm types (innovative, generic, branded generic or importing firms). To identify a causal effect, we use a differences-in-differences approach and additionally exploit the fact that the exemption policy had been introduced successively in the different clusters. We use quarterly data from 2007 to 2010 and find empirical evidence for differentiated price setting strategies by firm types, ranging from price decreases of -13.1% (branded generics firms) to increases of +2.0% (innovators) following the introduction of potential reductions in co-payments. We refer to the latter result as the co-payment exemption paradox. Our competition proxy (no. of firms) suggests a significant but small negative correlation with prices. --
    Keywords: pharmaceuticals,prices,co-payments,reference pricing,regulation,firm behavior
    JEL: D22 D40 I18 I11 L11
    Date: 2012

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