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Patent Litigation as an Information Transmission Mechanism

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  • Choi, J.P.

    (Tilburg University, Center For Economic Research)

Abstract

Patent litigation reveals important information about the validity of the contested patent to other potential entrants. This paper explores the implications of such informational externalities for entry dynamics in the presence of multiple potential entrants. The nature of the entry game can be one of either waiting or preemption depending on the degree of patent protection. Therefore, the payoffs for the patentee and the initial imitator are discontinuous in the degree of patent protection. Furthermore, strengthening intellectual property rights is not necessarily desirable for the patentee. The analysis may also help explain the apparently puzzling practice of delaying patent suits. Copyright 1998 by American Economic Association.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Choi, J.P., 1997. "Patent Litigation as an Information Transmission Mechanism," Discussion Paper 1997-17, Tilburg University, Center for Economic Research.
    • Handle: RePEc:tiu:tiucen:a9afa43f-baa3-4e40-b599-06e4a29cfc7b
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    References listed on IDEAS

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