We consider a market for vertically differentiated goods where firms enter over time, after having developed innovations characterised by different quality levels. We show that patent height and length interact to determine the ultimate emergence of duopoly. In general, imposing quality improvements on later entrants entails the persistence of monopoly, while a duopoly equilibrium emerges when the second innovator is allowed to produce a sufficiently inferior quality and the patent protection granted to the first innovator is not too long-lasting.

Tedeschi, P., Lambertini, L., On the Social Desirability of Patents for Sequential Innovations in a Vertically Differentiated Market, <<JOURNAL OF ECONOMICS>>, 2007; 90 (2): 193-214. [doi:10.1007/s00712-006-0231-5] [http://hdl.handle.net/10807/31132]

On the Social Desirability of Patents for Sequential Innovations in a Vertically Differentiated Market

Tedeschi, Piero;Lambertini, Luca
2007

Abstract

We consider a market for vertically differentiated goods where firms enter over time, after having developed innovations characterised by different quality levels. We show that patent height and length interact to determine the ultimate emergence of duopoly. In general, imposing quality improvements on later entrants entails the persistence of monopoly, while a duopoly equilibrium emerges when the second innovator is allowed to produce a sufficiently inferior quality and the patent protection granted to the first innovator is not too long-lasting.
2007
Inglese
Tedeschi, P., Lambertini, L., On the Social Desirability of Patents for Sequential Innovations in a Vertically Differentiated Market, <<JOURNAL OF ECONOMICS>>, 2007; 90 (2): 193-214. [doi:10.1007/s00712-006-0231-5] [http://hdl.handle.net/10807/31132]
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Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/10807/31132
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