nep-ipr New Economics Papers
on Intellectual Property Rights
Issue of 2019‒10‒28
five papers chosen by
Giovanni Ramello
Università degli Studi del Piemonte Orientale “Amedeo Avogadro”

  1. What goes around, comes around: Reciprocal effects and double-sided moral hazard in the choice of brand licensing By E. Bacchiega; M. Colucci; M. Magnani
  2. Role of social word-of-mouth on emotional brand attachment and brand choice intention: A study on private educational institutes in Vietnam By Charitha Harshani Perera; Rajkishore Nayak; Long Thang Van Nguyen
  3. Geocoding of worldwide patent data By Gaétan de Rassenfosse; Jan Kozak; Florian Seliger
  4. Per unit and ad valorem royalties in a patent licensing game By Montinaro, Marta; Scrimitore, Marcella
  5. Technology evolution in the global automotive industry: a patent-based analysis By Alessandra Perri; Daniela Silvestri; Francesco Zirpoli

  1. By: E. Bacchiega; M. Colucci; M. Magnani
    Abstract: Extending a brand beyond its original product category is a major strategy for long-term profitability. A brand owner can internalize the development of the extension product, or license the brand to an external partner in order to exploit the licensee’s better capabilities and higher efficiency on the targeted market. Brand extension is characterized by the presence of the socalled reciprocal effect, whereby the effort exerted to develop and market the extension has a feedback effect – either positive or negative – on the value of the parent brand. Under licensing, this effect is an externality from the standpoint of the brand owner. The licensing relationship is characterized by double-sided moral hazard, requiring an incentivizing contract; the reciprocal effect adds a further element that should be governed by the contract. Indeed, a positive effect can boost the attractiveness of licensing relative to internal development, whereas a negative one can have the opposite effect. Drawing from extant literature, we build a game-theoretical model and show how reciprocal effect, (dis)similarity between the extension product and the parent brand, and (in)efficiency of the brand owner relative to the licensee in developing the extension shape the optimal licensing contract and affect the choice between internal development and licensing.
    JEL: L12 L24
    Date: 2019–10
  2. By: Charitha Harshani Perera (School of Business & Management, RMIT University); Rajkishore Nayak (School of Communication & Design, RMIT University); Long Thang Van Nguyen (School of Communication & Design, RMIT University)
    Abstract: Prospective students are increasingly using social media to gather information about the higher education institutes (HEIs) while seeking the experiences and recommendations from others to evaluate the HEIs in order to make enrolment decision. Although the electronic word-of-mouth (eWOM) in social media is increasingly adopting in Vietnam, the association of social word-of-mouth (sWOM) in the higher education sector in Vietnam is an under-researched area. Accordingly, using users and gratification theory, this study aims to identify the role of sWOM in developing emotional attachment with the brands. This study has focused to examine the prospective students? interaction with sWOM to develop emotional attachment with HEI brands and thus brand choice intention. Based on the survey of a sample of undergraduates in the private institutes in Vietnam, this study develops framework consisting of sWOM as independent variable, emotional brand attachment and brand choice intention as dependent variables, and social media interactivity, perceived information usefulness and sWOM credibility as mediating variables. The results were analysed using correlation and regression analysis. Structural Equation Modelling was adopted to measure the model fit of the framework. The results showed that sWOM has a significant impact on emotional brand attachment and brand choice intention in the higher education sector. Social media interactivity, perceived information usefulness and sWOM credibility strengthened the relationship among sWOM and emotional brand attachment. This paper offers a better understanding of how emotional brand attachment with social media affected is by sWOM and thus brand choice intention.
    Keywords: Social word-of-mouth, Emotional Brand Attachment, Higher Educational Institutes, Brand choice intention, Social media interactivity, Perceived information usefulness, SWOM credibility
    JEL: M31 M39
    Date: 2019–10
  3. By: Gaétan de Rassenfosse (Chair of Innovation and IP Policy, EPFL, Lausanne, Switzerland); Jan Kozak; Florian Seliger (KOF Swiss Economic Institute, ETH Zurich, Switzerland)
    Abstract: The dataset provides geographic coordinates for inventor and applicant locations in 18.8 million patent documents spanning over more than 30 years. The geocoded data are further allocated to the corresponding countries, regions and cities. When the address information was missing in the original patent document, we imputed it by using information from subsequent filings in the patent family. The resulting database can be used to study patenting activity at a fine-grained geographic level without creating bias towards the traditional, established patent offices.
    Date: 2019–07
  4. By: Montinaro, Marta; Scrimitore, Marcella
    Abstract: In a context of product innovation, we study two-part tariff licensing between a patentee and a potential rival which compete in a differentiated product market characterized by network externalities. The latter are shown to crucially affect the relative profitability of Cournot vs. Bertrand when a per unit royalty is applied. By contrast, we find that Cournot yields higher profits than Bertrand under ad valorem royalties, regardless of the strength of network effects.
    Keywords: licensing, product innovation, bertrand vs. cournot, network effects
    JEL: D43 L13 L20
    Date: 2019–03–06
  5. By: Alessandra Perri (Dept. of Management, Università Ca' Foscari Venice); Daniela Silvestri (Dept. of Management, Università Ca' Foscari Venice); Francesco Zirpoli (Dept. of Management, Università Ca' Foscari Venice)
    Abstract: This study explores the evolution of the knowledge base of the automotive industry. Over the last decades, the knowledge base of this industry has experienced major changes. New and originally unrelated fields have increasingly become relevant in the industry. Using data on utility patent families granted in the period 1990-2014, we map the knowledge base of the automotive industry by reconstructing and analyzing the innovative portfolio of the top firms operating in this industry. The analysis documents exploration in new technical fields as well as persistence in industry-specific technical areas, pointing to the relevance of core competences that might be difficult to accumulate for industry outsiders.
    Keywords: knowledge base evolution, automotive industry, patent analysis
    JEL: L62 O34
    Date: 2019–10

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