Abstract
We assess patent policies where R&D aims at higher quality and the firms engage in strategic behavior. The innovation realized in one period affects the cost of realizing innovations in subsequent periods. The two firms compete in prices, and only one can innovate in each period. We compare the optimal innovation pattern to the second best innovation pattern, involving strategic behavior. Both are superior to the innovation pattern realized in an unregulated market. The market performance can be improved through the introduction of patent protection, and we characterize an optimal protection policy in the form of novelty requirements.
Original language | English |
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Pages (from-to) | 31-43 |
Number of pages | 13 |
Journal | Problems and Perspectives in Management |
Volume | 2 |
Issue number | 1 |
State | Published - 1 Jan 2004 |
ASJC Scopus subject areas
- Business and International Management
- General Business, Management and Accounting
- Sociology and Political Science
- Public Administration
- Strategy and Management
- Information Systems and Management
- Law