nep-ipr New Economics Papers
on Intellectual Property Rights
Issue of 2021‒05‒17
six papers chosen by
Giovanni Ramello
Università degli Studi del Piemonte Orientale “Amedeo Avogadro”

  1. Stronger Patent Regime, Innovation and Scientist Mobility By Ganguly, Madhuparna
  2. The Battle Over Patents: History and the Politics of Innovation By Stephen H. Haber; Naomi R. Lamoreaux
  3. Licensing Life-Saving Drugs for Developing Countries: Evidence from the Medicines Patent Pool By Galasso, Alberto; Schankerman, Mark
  4. Collective Brand Reputation By Nocke, Volker; Strausz, Roland
  5. Visibility of Technology and Cumulative Innovation: Evidence from Trade Secrets Laws By Bernhard Ganglmair; Imke Reimers
  6. Invention and the Life Course: Age Differences in Patenting By Mary Kaltenberg; Adam B. Jaffe; Margie E. Lachman

  1. By: Ganguly, Madhuparna
    Abstract: This paper analyzes the effects of a stronger patent regime on innovation incentives, patenting propensity and scientist mobility when an innovating firm can partially recover its damage due to scientist movement from the infringing rival. The strength of the patent system, which is a function of litigation success probability and damage recovery proportion, stipulates expected indemnification. We show that stronger patents fail to reduce the likelihood of infringement and further, decrease the innovation's expected profitability. Higher potential reparation also reduces the scientist's expected return on R&D knowledge, entailing greater R&D investment. Our results suggest important considerations for patent reforms.
    Keywords: Damage rules; Infringement; Patent strength; Scientist mobility
    JEL: J60 K40 L13 O34
    Date: 2021
  2. By: Stephen H. Haber; Naomi R. Lamoreaux
    Abstract: This essay is the introduction to a book of the same title, forthcoming in summer of 2021 from Oxford University Press. The purpose is to document the ways in which patent systems are products of battles over the economic surplus from innovation. The features of these systems take shape as interests at different points in the production chain seek advantage in any way they can, and consequently, they are riven with imperfections. The interesting historical question is why US-style patent systems with all their imperfections have come to dominate other methods of encouraging inventive activity. The essays in the book suggest that the creation of a tradable but temporary property right facilitates the transfer of technological knowledge and thus fosters a highly productive decentralized ecology of inventors and firms.
    JEL: N4 N41 N42 N43 N44 O3 O34
    Date: 2021–05
  3. By: Galasso, Alberto; Schankerman, Mark
    Abstract: We study the effects of a patent pool on the licensing and adoption of life-saving drugs in low- and middle-income countries. Using data on licensing and sales for HIV, hepatitis C and tuberculosis drugs, we show that there is an immediate and large increase in licensing by generic firms when a patent is included in the Medicines Patent Pool (MPP). This finding is robust to identification strategies to deal with endogeneity of MPP patents and countries. The impact of the MPP is especially large for small, non-Sub-Saharan countries. The impact on actual entry and sales, however, is much smaller than on licensing, which is due to geographic bundling of licenses by the MPP. More broadly, the paper highlights the potential of pools in promoting technology diffusion of biomedical innovation.
    Keywords: developing countries; HIV; licensing; Patent pool; patents; pharmaceuticals; Public health
    JEL: I18 O31 O34
    Date: 2020–12
  4. By: Nocke, Volker; Strausz, Roland
    Abstract: We develop a theory of collective brand reputation for markets in which product quality is jointly determined by local and global players. In a repeated game of imperfect public monitoring, we model collective branding as a pooling of quality signals generated in different markets. Such pooling yields a beneficial informativeness effect for the actions of a global player present in all markets, but also harmful free-riding by local, market-specific players. The resulting tradeoff yields a theory of optimal brand size and revenue sharing, applying to platform markets, franchising, licensing, umbrella branding, and firms with team production.
    Keywords: Collective branding; free riding; Imperfect Monitoring; repeated games; reputation
    Date: 2021–01
  5. By: Bernhard Ganglmair; Imke Reimers
    Abstract: We use exogenous variation in the strength of trade secrets protection to show that a relative weakening of patents (compared to trade secrets) has a disproportionately negative effect on the disclosure of processes - inventions that are not otherwise visible to society. We develop a structural model of initial and follow-on innovation to determine the effects of such a shift in disclosure on overall welfare in industries characterized by cumulative innovation. We find that while stronger trade secrets encourage investment in R&D, they may have negative effects on overall welfare - the result of a significant decline in follow-on innovation.
    Keywords: cumulative innovation; disclosure; self-disclosing inventions; Uniform Trade Secrets Act
    JEL: D80 O31 O34
    Date: 2019–08
  6. By: Mary Kaltenberg; Adam B. Jaffe; Margie E. Lachman
    Abstract: Previous research suggests creative ability peaks in the age decades of the 30s and early 40s, and declines thereafter, with some variation across fields. Building from the cognitive aging literature, we expect differences in the rate of creation and qualitative nature of creative works by age. Cognitive processes show aging-related changes with increases in experience-based knowledge (pragmatics or crystallized abilities) and decreases in the ability to process novel information quickly and efficiently (mechanics or fluid abilities). We describe a new database created by combining the publicly available patent data with information on inventor ages scraped from directory websites on the web for approximately 1.2 million U.S.-resident inventors patenting between 1976 and 2017. Our results suggest that cross-sectional and within-inventor patenting rates are similar, peaking at around the early 40s for both women and men. We find varying results for attributes of patents in relation to age, some of which are consistent with cognitive aging theory. For solo inventors, backward citations and originality, which are connected to experience, were found to increase with age. Forward citations, number of claims, and generality measures, as well as a citation-based measure of disruptiveness decline on average with inventor age. A similar pattern was found for performance in teams based on the average age of inventors in the team. Exploration of age diversity showed that teams with a wider age range had patents that are slightly more important (i.e., with more forward citations). The findings have the potential to advance scholarship on the life course of innovation with implications for workplace policies.
    JEL: O31 O34
    Date: 2021–05

This nep-ipr issue is ©2021 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.