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Little Firms and Big Patents: The Incentives To Disclose Competencies

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  • Wolfgang Gick

    (Dartmouth College)

Abstract

This paper offers a theoretical treatment of information disclosure through patenting. We consider a signaling model in which two domestic firms disclose their competencies to a foreign firm. Conditions are discussed under which separating and pooling equilibria occur, together with a domination-based re-finement. Depending on the payoff situation of the foreign firm, separating and semi-separating equilibria occur in which the firm with the higher competencies discloses. We show that subsidizing the costs of patent applications has no impact on the outcome.

Suggested Citation

  • Wolfgang Gick, 2004. "Little Firms and Big Patents: The Incentives To Disclose Competencies," Industrial Organization 0411010, University Library of Munich, Germany.
    • Handle: RePEc:wpa:wuwpio:0411010
    Note: Type of Document - pdf; pages: 21
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    References listed on IDEAS

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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Patenting; Disclosure; R&D Cooperations; Asymmetric Information.;
    All these keywords.

    JEL classification:

    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O34 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital

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