Issue: Spring 1996
Pages: pp. 60-83
Authors: Carmen Matutes, Pierre Regibeau, and Katharine Rockett
Title: Optimal Patent Design and the Diffusion of Innovations
Abstract: Innovators who have made significant breakthroughs may be tempted to get a head start in developing the applications of a new discovery before commercializing any new product. We consider how this socially undesirable waiting period and the pattern of development of subsequent innovations are affected by two patent protection regimes which we call "length" and "scope" protection. Our main finding is that the scope of the patent, and not its length, is the dimension that should be used to induce early disclosure of fundamental innovations while still preserving firms' incentive to do R&D. Furthermore, the optimal protection increases with rivalry in the markets for applications.
Intellectual Property Rights: National and International Issues, Patents, Copyrights (O340)
Innovation and Invention: Processes and Incentives (O310)
Technological Change; Innovation; Research and Development: General (6210)
Technological Change and Innovation (6211)