nep-ipr New Economics Papers
on Intellectual Property Rights
Issue of 2014‒09‒25
two papers chosen by
Giovanni Ramello
Università degli Studi del Piemonte Orientale “Amedeo Avogadro”

  1. Optimal Sharing Strategies in Dynamic By Nisvan Erkal "; " Deborah Minehart
  2. Protection of Traditional Knowledge and Origin Products in Developing Countries: Matching Human Rights and IP Protection with Business Development Opportunities By Patrick Martens

  1. By: Nisvan Erkal "; " Deborah Minehart
    Abstract: A question central to R&D policy making is the impact of competition on cooperation. This paper builds a theoretical foundation for the dynamics of knowledge sharing in private industry. We model an uncertain research process and ask how the incentives to license intermediate steps to rivals change over time as the research project approaches maturity. Such a dynamic approach allows us to analyze the interaction between how close the ?rms are to product market competition and how intense that competition is. We uncover a basic dynamic of sharing such that ?rms are less likely to share as they approach the product market. This dynamic is driven by a trade-o¤ between three e¤ects: the rivalry e¤ect, the duplication e¤ect and the speed e¤ect. We show that this dynamic can be reversed when duopoly pro?ts are su¢ ciently low. We also explore the implications of the model for patent policy and R&D subsidies, and discuss under what circumstances such policies should be directed towards early vs. later stage research.
    Keywords: Multi-stage R&D; innovation; knowledge sharing; licensing; dynamic games; patent
    Date: 2013
  2. By: Patrick Martens (Maastricht School of Management)
    Abstract: This paper is focused on the links between the protection of Traditional Knowledge (TK), including origin products, and local economic development in developing countries. The analytical framework for the paper is based on Amartya Sen‟s elaboration of “development as freedom” in which development is seen as a fundamental human rights issue encompassing protective security, the provision of economic facilities, political freedoms, social opportunities and transparency guarantees (Sen, 1999). Context is provided by criticism of the behavior of multinational companies (MNCs) in developing countries, including allegations of bio-piracy, unfair labor practices and misappropriation of TK and Genetic Resources (GR) from their owners in combination with the growing importance of Corporate Social Responsibility as a business imperative for MNCs as well as civil society activism for human rights in north-south economic relations. Furthermore, owners and holders of TK and GR frequently also have to contend with anti-democratic practices and exploitation by their own governments and local elites thereby underlining the importance of international economic law (IEL). The paper assesses the current situation regarding the protection of TK in IEL, particularly regarding promising initiatives requiring compulsory benefit sharing and prior consultation, with specific reference to case studies of products from developing countries; notably, these products have become integrated into global value chains (which also include MNCs as lead actors). Two particularly relevant cases: argane oil from Morocco and rooibos from South Africa are discussed in relation to Sen‟s „development as freedom‟ framework. These contrasting experiences lead to conclusions being made on the need to strengthen international, regional and national protective legal systems and political freedoms while at the same time providing an appropriate level of development support in the establishment of „economic facilities‟, „transparency guarantees‟ and „social opportunities‟ in Sen‟s terms, including value chain upgrading and well-designed technical assistance.
    Keywords: Development as Freedom, Economic Facilities, Geographical Indications, Intellectual Property Rights, Protective Security, Social Opportunities, Traditional knowledge, Transparency Guarantees
    Date: 2014–09

This nep-ipr issue is ©2014 by Giovanni Ramello. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.