Optimal formation rules for patent pools

Brenner, Steffen

doi:10.1007/s00199-008-0379-z

Cited by 47 publications

(32 citation statements)

References 8 publications

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“…The insight rests upon applying Cournot's (1838) analysis of independent monopolies providing perfectly complementary inputs to a downstream producer, in which neither of the upstream suppliers incorporate the negative externality that their pricing decision has on the other. 3 The implied (horizontal) doublemarginalization then results in lower producer and consumer surplus. The analysis was further refined in a general model by Lerner and Tirole (2004), who also conclude that 1 See, e.g., E. Bement & Sons v. National Harrow Co., 186 U.S. 70 (1902).…”

Section: Patent Pools and The Structure Of Innovationmentioning

confidence: 99%

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Adverse Effects of Patent Pooling on Product Development and Commercialization

Jeitschko

Zhang²

2014

The B.E. Journal of Theoretical Economics

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The conventional antitrust wisdom is that the formation of patent pools is welfare enhancing when patents are complementary, since the pool avoids a double-marginalization problem associated with independent licensing. The focus of this paper is on (downstream) product development and commercialization on the basis of perfectly complementary patents. We consider development technologies that entail spillovers between rivals, and assume that final demand products are imperfect substitutes. When pool formation facilitates information sharing and either increases spillovers in development or decreases the degree of product differentiation, patent pools can adversely affect welfare by reducing the incentives towards product development and product market competition-even with perfectly complementary patents. This modifies and even negates the conventional wisdom for some settings and suggests why patent pools are uncommon in science-based industries such as biotech and pharmaceuticals, despite there being frequent policy advocacy for them.

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Section: Patent Pools and The Structure Of Innovationmentioning

confidence: 99%

“…For a brief synopsis of the historical development see Miller and Almeling (2007) or Gilbert (2004). 3 Cournot illustrates his point by considering the pricing decisions of a monopolist for copper and a monopolist for zinc who are providing the necessary inputs to a downstream producer of brass.…”

Section: Patent Pools and The Structure Of Innovationmentioning

confidence: 99%

Adverse Effects of Patent Pooling on Product Development and Commercialization

Jeitschko

Zhang²

2014

The B.E. Journal of Theoretical Economics

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“…Early innovators have more incentives to enter the pool than subsequent innovators. Brenner (2009) finds an elegant mechanism to solve the instability problem for socially desirable patent pools in a static model. We leave the design of an equivalent mechanism in the context of a dynamic model for future research.…”

Section: Endogenous Patent Pool Formationmentioning

confidence: 99%

“…The design of a mechanism to solve the pool instability problem, along the lines of Brenner (2009), is beyond the scope of this paper. However, we find that a scheme in which each innovator buys all patent rights from the preceding innovator, instead of paying only for the permission to use the idea, can replicate the patent pool outcome.…”

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confidence: 99%

Patent Policy, Patent Pools, and the Accumulation of Claims in Sequential Innovation

Llanes

Trento

2009

SSRN Journal

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Abstract. We present a dynamic model where the accumulation of patents generates an increasing number of claims on sequential innovation. We compare innovation activity under three regimes -patents, no-patents, and patent pools-and find that none of them can reach the first best. We find that the first best can be reached through a decentralized tax-subsidy mechanism, by which innovators receive a subsidy when they innovate, and are taxed with subsequent innovations. This finding implies that optimal transfers work in the exact opposite way as traditional patents. Finally, we consider patents of finite duration and determine the optimal patent length.

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“…With the development of the integration of world economy and the intensifying of international competition, patent pool whose main body is enterprise is a paradigm of industry competition especially in electronic, information technology, communication technology, biological pharmacy, and so on, high and new technology industries. However Brenner S. (2009) [4] found out "coalition dilemma" of patent pool, patent pool was not complete, namely patent pool did not include all essential patents that were applied in A technology or A technical standard. Meanwhile because of competition among technical standards, there form multiple competitive patent pool based on different technical standards in one industry.…”

Section: Introductionmentioning

confidence: 99%

Study on the Cumulative Innovation Effect of the Competitive Patent Pools Based on the Different Technical Standards

Luo¹,

Zheng²,

Xiao-jun³

et al. 2016

OJBM

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Multi-patent pools based on different technical standards are appearing in many technique industries with competitions becoming intensive among technical standards. Theoretical model of cumulative innovation effect of competitive patent pools based on different technical standards is developed by dynamic game theory in this paper to study the cumulative innovation effect of competitive patent pool under the different patent types of relationship between patents, which are blocking patent, substitutability patent and additional innovation patent. This research indicates: the R&D investments of an enterprise inside a patent pool increase (or decrease) as the R&D investments of other enterprises inside the same patent pool decrease (or increase) or as the R&D investments of the enterprises inside another patent pool or the R&D investments of the enterprises outside patent pools increase (or decrease) during the patent race of blocking patent. The bigger differentiation degree between patents is, the R&D investments of all enterprises are more during the patent race of substitutability patent. The R&D investments of an enterprise inside a patent pool are bigger than outside the patent pools during the patent race of additional innovation patent.

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Optimal formation rules for patent pools

Abstract: R&D cooperation, Endogenous coalition formation, Optimal coalitions, Antitrust, Patent thicket, K11, L41, M2,

Cited by 47 publications

References 8 publications

Adverse Effects of Patent Pooling on Product Development and Commercialization

Adverse Effects of Patent Pooling on Product Development and Commercialization

Patent Policy, Patent Pools, and the Accumulation of Claims in Sequential Innovation

Study on the Cumulative Innovation Effect of the Competitive Patent Pools Based on the Different Technical Standards

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