Optimal patent length and breadth in an economy with creative destruction and non-diversifiable risk

Palokangas, Tapio

doi:10.1007/s00712-010-0161-0

Cited by 15 publications

(17 citation statements)

References 16 publications

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“…6 See Chu (2010) for a quantitative analysis on the effects of patent breadth on income and consumption inequality in addition to economic growth, and also see Chu (2011) for a quantitative analysis on uniform versus sector-specific optimal patent breadth in a two-sector quality-ladder growth model. 7 See also Iwaisako and Futagami (2003), Palokangas (2011), and Sorek (2011) on optimal patent length and breadth and Chu and Furukawa (2011) on optimal patent breadth and profit division in research joint ventures. Fung, Zeng, and Zhang (2012) provide an interesting analysis on the optimal coordination between patent length and price regulation.…”

Section: A Simple Randd-based Growth Model With Basic and Applied Researchmentioning

confidence: 99%

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Patentability and Knowledge Spillovers of Basic R&D

Chu

Furukawa

2013

Southern Economic Journal

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This study develops an R&D-based growth model with basic and applied research to analyze the growth and welfare e¤ects of two patent instruments: (a) the patentability of basic R&D, and (b) the division of pro…t between basic and applied researchers.We …nd that for the purpose of stimulating basic R&D and economic growth simultaneously, increasing the share of pro…t assigned to basic researchers is more e¤ective than raising the patentability of basic R&D, which has either a negative e¤ect or an inverted-U e¤ect on technological progress. However, a benevolent patent authority requires both patent instruments to achieve the socially optimal allocation in the decentralized economy.JEL classi…cation: O31, O34, O40

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Section: A Simple Randd-based Growth Model With Basic and Applied Researchmentioning

confidence: 99%

“… See also , , and on optimal patent length and breadth and on optimal patent breadth and profit division in research joint ventures. provide an interesting analysis on the optimal coordination between patent length and price regulation.…”

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confidence: 99%

Patentability and Knowledge Spillovers of Basic R&D

Chu

Furukawa

2013

Southern Economic Journal

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“…In contrast, other studies have incorporated the time‐invariant probability of being imitated into their models instead of incorporating patent length explicitly and thereby have regarded a decrease in the probability as strengthening patent protection. See Cysne and Turchick (), Furukawa (), Grinols and Lin (), Horii and Iwaisako (), and Palokangas ().…”

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confidence: 99%

Effects of Patent Protection on Optimal Corporate Income and Consumption Taxes in an R&D‐Based Growth Model

Iwaisako

2016

Southern Economic Journal

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Does reducing the corporate income tax accompanied by an increase in the consumption tax to meet the governments budget constraint improve welfare? To respond, I examine the welfare-maximizing corporate income tax and consumption tax rates in an R&D-based growth model under the constraint that the governments budget is balanced at each point of time. Further, I consider how welfare-maximizing tax rates change as patent protection becomes stronger, as seen in many countries. The results show that as patent protection becomes stronger, the corporate income tax rate should be higher and the consumption tax rate should be lower. This implies that under stronger patent protection, recovering production at the expense of innovation by raising corporate income tax and reducing consumption tax improves welfare.

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“…which means that the average quality across industry represents the accumulation of innovation successes in the past. (30) and (31) imply that the utility per person depends on total expenditure, c(t), the prices of differentiated goods as determined by patent breadth, β, and the accumulated volume of innovations from the past, ∫ t 0 I(s)ds. Therefore, the effect of strengthening patent protection on instantaneous utility consists of three parts:…”

Section: Welfare Analysismentioning

confidence: 99%

Welfare Effects of Patent Protection in a Semi-Endogenous Growth Model

Iwaisako

2018

Macroecon. Dynam.

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This paper examines how strengthening patent protection affects welfare in a nonscale quality-ladder model, which was developed by Segerstrom [American Economic Review 88, 1290–1310] and generalized by Li [American Economic Review 93, 1009–1017]. In the Segerstrom–Li model, patent protection creates no distortion in static allocation among the production sectors. In order to examine the welfare effects of strengthening patent protection adequately, we incorporate a competitive outside good into the Segerstrom–Li model. In the general model, we derive the welfare-maximizing degree of patent protection analytically by utilizing a linear approximation of the transition path. The result shows that the welfare-maximizing degree of patent protection is weaker when the market share of the outside good is positive than when it is zero. In other words, disregarding the static distortion that patent protection creates leads to excessive patent protection.

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Optimal patent length and breadth in an economy with creative destruction and non-diversifiable risk

Abstract: Patents, Imitation, Innovation, Product cycles, Non-diversifiable risk, L11, L16, O31, O34,

Cited by 15 publications

References 16 publications

Patentability and Knowledge Spillovers of Basic R&D

Patentability and Knowledge Spillovers of Basic R&D

Effects of Patent Protection on Optimal Corporate Income and Consumption Taxes in an R&D‐Based Growth Model

Welfare Effects of Patent Protection in a Semi-Endogenous Growth Model

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