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Sequential R&D and blocking patents in the dynamics of growth

Cozzi, Guido ; Galli, Silvia

In: Journal of Economic Growth, 2014, vol. 19, no. 2, p. 183-219

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    Titre
    • Sequential R&D and blocking patents in the dynamics of growth
    Auteur
    • Cozzi, Guido. Department of Economics, FGN-HSG, University of St. Gallen, Varnbüelstrasse 19, 9000, St. Gallen, Switzerland
    • Galli, Silvia. Department of Economics, FGN-HSG, University of St. Gallen, Varnbüelstrasse 19, 9000, St. Gallen, Switzerland
    Type de document
    • Postprint
    Langue
    • Inglese
    Publié dans
    • Journal of Economic Growth, 2014, vol. 19, no. 2, p. 183-219. Springer US; http://www.springer-ny.com
    Autre version électronique
    Identifiant OAI-PMH
    • oai:doc.rero.ch:324868
    Summary
    The incentives to conduct basic or applied research play a central role for economic growth. How does increasing early innovation appropriability affect basic research, applied research, innovation and growth? In a common law system an explicitly dynamic macroeconomic analysis is appropriate. This paper analyzes the macroeconomic effects of patent protection by incorporating a two-stage cumulative innovation structure into a quality-ladder growth model with endogenous skill acquisition. We focus on two issues: (a) the over-protection versus the under-protection of intellectual property rights in basic research; (b) the evolution of jurisprudence shaping the bargaining power of the upstream innovators. We show that the dynamic general equilibrium interactions may seriously mislead the empirical assessment of the growth effects of IPR policy: stronger protection of upstream innovation always looks bad in the short- and possibly medium-run. We also provide a simple "rule of thumb” indicator of the basic researcher bargaining power.