patent pools as a solution to efficient licensing of complementary patents some experimental evidence production requiring licensing groups of complementary patents implements a coordination game among patent holders who can price patents by choosing among combinations of fixed and royalty fees summed across patents these fees become the total producer cost of the package of patents royalties because they function as excise taxes add to marginal costs resulting in higher prices and reduced quantities of the downstream product and lower payoffs to the patent holders using fixed fees eliminates this inefficiency but yields a more complex coordination game in which there are multiple equilibria which are very fragile in that small mistakes can lead the downstream firm to not license the technology resulting in inefficient outcomes we report on a laboratory market investigation of the efficiency effects of coordinated pricing of patents in a patent pool we find that pool like pricing agreements can yield fewer coordination failures in the pricing of complementary patents

collateral damage for r d manufacturers how patent sharks operate in markets for technology patent sharks small firms that exploit information asymmetries in markets for technology to gain patent based competitive advantages challenge established theory by which i markets for technology benefit large firms and ii intellectual property rights systems strictly support markets for technology empirically linking the sharks different assault strategies to the patents they deploy we illustrate that patent sharks will likely be an enduring phenomenon in markets for technology we discuss policy and strategy implications copyright 2010 the author 2010 published by oxford university press on behalf of associazione icc all rights reserved oxford university press

standard essential patents a major policy issue in standard setting is that patents that are ex ante not that important by being included into a standard may become standard essential patents in an attempt to curb the monopoly power that they create most standard setting organizations require the owners of patents covered by the standard to make a loose commitment to grant licenses on reasonable terms such commitments unsurprisingly are conducive to litigation this paper builds a framework for the analysis of these patents identifies several types of inefficiencies attached to the lack of price commitments and shows how structured price commitments restore competition and why such commitments may not arise spontaneously in the marketplace

credible spatial preemption it is often argued that incumbent firms may deter entry by preemptive investment in new goods we show that these conclusions are reversed when multiproduct incumbentfirms may exit in response to entry once entrants are in an industry an incumbent will often want to withdraw some goods to prevent competition with the entrant from reducing profits on other goods such a reaction makes entry more attractive to a potential entrant the equilibrium industry structure is less likely to be monopolistic as the goods are better substitutes as exit costs are low and as the competition between producers of the same good is more intense

the impact of the timing of patents on innovation performance abstract in the context of industry standard setting firms face the strategic decision of whether to move faster than competitors or wait for more information that reduces uncertainty these decisions are even more challenging if there are multiple standards and if there are benefits to belonging to more than one standard this paper examines the effect of the timing of patents on a firm s innovation performance the strategic logic of real options posits that patent timing is determined by the tension between the value of preemption and the value of waiting we analyze 680 dvd disc patents in dvd patent pools to test the effect of the timing of patents on innovation performance consistent with real options logic under high uncertainty the later the timing of the patent the higher the innovation performance while under low uncertainty there is an early mover advantage

fragmented property rights and incentives for r d where product innovation requires several complementary patents fragmented property rights can limit firms willingness to invest in r d we consider the research intensity in multiple simultaneous r d contests and how it depends on whether firms already hold relevant patents as well as the availability of an option to invent around a measure of technological uncertainty is also analyzed the multiple patent product involves an important hold up problem that can reduce the overall r d effort invent around options moderate this problem we also analyze targeted equilibria in which the aim of r d can be to hold up a rival

the direction of innovation abstract how do innovation policies affect the direction of research is market based innovation too radical or too incremental we construct a novel and tractable model of the direction of innovation firms pursue inefficient research directions because they race to discover easy yet less valuable projects and because they work on difficult inventions where they can appropriate a larger portion of the social value fixing these inefficiencies requires policy to condition on properties of inventions that could have been discovered but were not policies which do not do so like patents and prizes may fail to encourage firms to research in the efficient direction even if they obtain the optimal quantity of r d

do patents over compensate innovators is the current level of patent protection too high or too low to address this issue this paper reformulates the theoretical analysis of the optimal level of patent protection to take into account the empirical findings of the innovation production function literature this literature finds a strong relationship between r d spending and inventions and estimates an elasticity of the supply of inventions of 0 5 or more the paper then assesses the current level of patent protection exploiting estimates of the private and social returns to r d taken from the empirical literature and other available sources although more research is needed for a more precise assessment the evidence available suggests that patents do not over compensate innovators vincenzo denicolo

feed in or certificates competition or complementarity combining a static efficiency and a dynamic innovation perspective on the greening of the energy industry abstract european policy on the greening of the energy industry has been characterised by a debate between proponents of two apparent polar opposites feed in tariffs and certificate markets different european countries have chosen both mechanisms and as a consequence the european union has maintained a fairly pluralist position abstaining from stricter harmonisation taking a dynamic innovation perspective on european energy industry we argue that feed in tariffs and certificate markets should not be seen as competing alternatives but rather as complementary regulatory instruments targeting subsequent steps in the product cycle on the way from early technology conceptualisation and development towards competitive positioning in mature energy markets we see both policy instruments as necessary to achieve the extensive transformation towards sustainable development that is judged as important tools in the context of the global climate challenge

innovation policy for directing technical change in the power sector this paper discusses policy instruments for redirecting technical change within the electricity sector to mitigate climate change first we unravel the mechanism behind directed technical change explaining why markets may underprovide innovations in expensive renewable technologies in comparison to innovations in energy efficient fossil fuel generators subsequently we characterize technical change in electricity generation technologies stressing the heterogeneity of knowledge spillovers both within and between clean electricity generation technologies we argue that there exists a rationale for a portfolio approach to innovation in the electricity sector i e optimal innovation policies are neither fully generic nor fully specific and they need to be adapted in response to new information learned by the government the existing innovation literature does not however provide a clear cut answer for designing such a policy we compare policy instruments and argue that public r d support to clean technologies either in the form of subsidies or prizes seems to be the prime candidate for implementing non generic innovation policy

licensing policy and technology adoption in standard setting organizations the standard setting organizations decisions on licensing policy and standard s technological specification and the ensuing implications for social welfare are analyzed the author finds the conditions under which a licensing rule that grants monopoly power to the licensors whose technology is adopted in the standard can be employed by the members of the consortium ex post licensing moreover it is shown that the adoption of ex post licensing might lead to the inefficient exclusion of an efficient stand alone licensor finally the author discusses the conditions under which a policy of ex ante licensing can be less efficient than ex post licensing jel k21 l15 l24 l42

basic concepts for designing renewable electricity support aiming at a full scale transition by 2050 abstract renewable electricity supply is a crucial factor in the realization of a low carbon energy economy the understanding is growing that a full turn over of the electricity sectors by 2050 is an elementary condition for avoiding global average temperature increase beyond 2 c this article adopts such full transition as europe s target when designing renewable energy policy an immediate corollary is that phasing in unprecedented energy efficiency and renewable generation must be paralleled by phasing out non sustainable fossil fuel and nuclear power technologies the double phasing programme assigns novel meaning to nearby target settings for renewable power as share of total power consumption it requires organizing in the medium term eu wide markets for green power a highly demanding task in the present context of poorly functional markets in brown power the eu commission s 2007 2008 proposals of expanding tradable certificates markets were not based on solid analysis of past experiences and future necessities the keystone of sound policies on renewable electricity development is a detailed scientific differentiation and qualification of renewable electricity sources and technologies for measuring the huge diversity in the field we provide but structuring concepts about such qualification because implementation requires extensive research resources support for renewable electricity development is organized via feed in prices or premiums and via quota obligations connected to tradable green certificates green certificates are dependent on physical generated renewable power but separable and no joint products contrary to conventional wisdom we argue their separation in cost analysis but firm linking during trade a few graphs illustrate the importance of assigning qualities to different renewable power sources technologies feed in systems based on an acceptable qualification perform generally better than certificate markets imposing uniform approaches on a very diverse reality for a similar reason uniform and undifferentiated taxation of non sustainable energy sources cannot replace renewable energy support schemes capable of differentiation

efficient patent pools the paper builds a tractable model of patent pools agreements among patent owners to license sets of their patents it provides a necessary and sufficient condition for patent pools to enhance welfare and shows that requiring pool members to be able to independently license patents matters if and only if the pool is otherwise welfare reducing the paper allows patents to differ in importance asymmetric blocking patterns and licensors to also be licensees we undertake some initial exploration of the impact of pools on innovation the analysis has broader applicability than pools being relevant to a number of co marketing arrangements

can premium tariffs for micro generation and small scale renewable heat help the fuel poor and if so how case studies of innovative finance for community energy schemes in the uk abstract in the uk the introduction of micro generation feed in tariffs fits and a proposed renewable heat incentive rhi for domestic and small scale schemes have re energised the market for investment in domestic scale renewable energy these incentives may provide financial opportunities for those with capital to spend but for the record numbers with low incomes in fuel poverty these benefits may seem out of reach this paper shows that with appropriate financial intermediaries it is possible for renewable energy incentives to be used to alleviate fuel poverty simple financial analysis demonstrates the theoretical potential of fits to help those in fuel poverty two case studies of renewable energy projects in low income areas investigate how the incentives may be used in practice what barriers exist and what success factors are evident the analysis shows that local energy organisations leos are key if the poor are to access benefits from premium tariff schemes low interest finance mechanisms good information sharing and community involvement are found as key success factors

safe nests in global nets internationalization and appropriability of r d in wireless telecom this paper documents the case of the wireless telecom industry to bring new empirical evidence to the debate on the internationalization of research and development r d activities us patent statistics on the four industry leaders ericsson motorola nokia and qualcomm illustrate the growing trend of the internationalization of r d over the 1990s yet we show that the most critical r d projects related to the development of wireless standards remain homebound the paper then leverages qualitative data collected through interviews with informed managers to provide a fresh interpretation for the homeboundedness of critical industrial r d the stickiness of core r d projects to domestic locations is related not only to organizational inertia and the unripe maturation of subsidiaries as suggested by prior literature but particularly to the headquarters centralization of intellectual property ip management which offers a high level of appropriability of r d results the unequal distribution of appropriability across corporate r d networks is at the base of the formation of safe nests domestic r d centers that are sheltered from the forces of globalization because they offer a desirable setting for the exploitation of technologies deriving from a stronger coordination of inventive activities with the management of ip

shared patent rights and technological progress we study how to reward innovators who build on one another rewards come in the form of patents because patent rights are scarce the optimal allocation involves sharing more than one innovator s patent is in force at a given time we interpret such allocations as patents that infringe one another as licensing through an ever growing patent pool and as randomization through litigation we contrast the rate of technological progress under the optimal allocation with the outcome if sharing is prohibitively costly avoiding sharing initially slows progress and leads to a more variable rate of technological progress

a theoretical explanation of some stylized facts of economic growth this paper presents a three good two country general equilibrium model that is consistent with several stylized facts of economic growth the three goods are manufactures agriculture and services manufactures are subject to economies of scale the model predicts that services a nontraded good must be more expensive in the country with higher per capita income it also shows that as per capita income increases we should expect the productivity in commodities relative to services to rise the model is able to generate many other stylized facts of economic growth

nonconventional renewable energy governance in brazil lessons to learn from the german experience abstract this paper presents a comparative analysis of energy governance regarding nonconventional renewable energy sources ncres in brazil and germany brazil is a world leader in the use of conventional renewable energy sources such as hydro power while germany has been achieving outstanding results in fostering ncres the focus is on two critical issues the legal and regulatory framework and the institutions created to support the ncres market development the comparison shows that despite the very different energy situations and policy drivers valuables lessons can be extracted from the german experience the main lesson for brazil is to think ncres as a strategic opportunity to rely less on fossil fuel and large hydroelectric power plants to decentralize the electric power sector to use the huge solar biomass and wind power potential available in the country and to create a environment friendly ncres industry to this end three critical points were identified 1 the legal and regulatory framework should be improved 2 long term energy planning taking into account social economic and climate issues and 3 the current institutions supporting ncres in brazil should be upgraded and or new ones such as more specific energy agencies should be created

financial development investment and economic growth zhenhui xu in this article i use a multivari ate vector autoregressive var approach to examine the effects of permanent financial development on domestic investment and output in 41 countries between 1960 and 1993 the var approach permits the identification of the long term cumulative effects of financial development on the domestic variables by allowing for dynamic interactions among these variables the results reject the hypothesis that financial development simply follows economic growth and has very little effect on it instead there is strong evidence that financial development is important to growth and that investment is an important channel through which financial development affects growth jel e22 e44 e47 016 057 keywords economic growth financial development investment vector auto regression impulse response i introduction interest in the relationship between financial development and economic growth dates back to early this century and has been growing since the 1980s 1 in the literature three views have emerged concerning the potential importance of finance in economic growth the first sees finance as a critical element of growth schumpeter 19113 goldsmith 19691 mckinnon 19733 shaw 1973 fry 1978 1988 bencivenga and smith 1991 king and levine 1993a 1993b in this view services provided by the financial system are essential for growth and a repressed financial system characterized by price distortion undersaving negative or unstable returns on savings and investment and inefficient allocation of savings among competing users impedes growth 2 as the financial system develops households substitute out of unproductive tangible assets raising the total real supply of credit the quantity and quality of investment and thus the rate of economic growth in addition financial development can pro mote technological innovations and productivity growth king and levine 1993a the second view regards finance as a relatively unimportant factor in growth essentially as the handmaiden to industry and commerce robinson 19521 lucas 1988 stern 1989 in this perspective the lack of financial development is simply a manifestation of the lack of demand for financial services as the real sectors of the economy grow the demand for various financial services rises and will thus be met by the financial sector based on this view financial development simply follows economic growth and has very little effect on it like the first one the third view ascribes effects to finance but focuses on its potential negative impacts on growth van wijnbergen 1983 buffie 1984 economists holding this view contend that financial development can hinder growth by reducing available credit to domestic firms this situation arises from the presence of informal curb markets as the formal financial system develops households are seen to substitute out of curb market loans thus reducing the total real supply of domestic credit the reduction in the supply of credit can lead to a credit crunch thereby lowering investment and slowing production and growth further such a credit crunch can retard economic growth beyond the short term by lowering the steady state capital stock wijnbergen 1983 from these divergent views three testable hypotheses emerge with sharply different policy implications the first view suggests that government policies should be directed toward improving the financial system since financial development has important causal effects on growth the second view implies that government policies toward improving the financial system will have little effect on growth since financial development results from growth and has little impact on it based on the third view there is a potential danger of financial development under certain institutional arrangements government efforts toward financial development can cost an economy its long term growth by reducing total real supply of domestic credit

review of barriers to the dissemination of decentralized renewable energy systems abstract this paper reviews the available literature dealing with the barriers to the dissemination of decentralized renewable energy systems decentralized renewable energy systems may face a range of technical economic institutional socio cultural and environmental barrier to their dissemination in the paper barriers impeding the dissemination of decentralized renewable energy systems have been identified and assessed in addition appropriate remedial measures and corresponding responsibility centers as reported in the literature have also been discussed inappropriateness of technology unavailability of skilled manpower for maintenance unavailability of spare parts high cost lack of access to credit poor purchasing power and other spending priorities unfair energy pricing lack of information or awareness and lack of adequate training on operation and maintenance of decentralized renewable energy systems are found to be the most critical barriers long term conducive policies appropriate regulatory framework financial incentives capital subsidies and soft loans to users technology and skill development internalization of externalities in the cost of energy withdrawal of subsidies presently being given to fossil fuels development of specialized institutions cooperation with international agencies participation of local community and awareness generation have been recommended for increased dissemination of decentralized renewable energy systems

emerging ways to address the reemerging conflict between patenting and technological standardization the relationship between standards and intellectual property rights iprs is a complementary but troubled one the way it is managed affects the way stakeholders contribute to standards and may ultimately affect the way some technologies and even industries evolve a spate of recent legal controversies has been accompanied by the emergence of new mechanisms to help govern the risk of conflict here this article provides an empirical analysis of these attempts to reconcile the aims of these regimes

patent pool formation and scope of patents basic innovations are often fundamental to the development of applications that may be developed by other innovators in this setting we investigate whether patent pools can rectify the lack of incentives for a developer to invest in an application following green and scotchmer 1995 we also wonder whether broad basic patents are necessary in order to provide enough incentives for basic innovators we show that patent pools are more likely

cross licensing and competition we study bilateral cross licensing agreements between n 2 firms that engage in competition after the licensing phase it is shown that the most collusive cross licensing royalty i e the one that allows the industry to achieve the monopoly profit is sustainable as the outcome of bilaterally efficient agreements in a symmetric setting if the terms of the cross licensing agreements are not observable to third parties the monopoly royalty is the unique symmetric bilaterally efficient royalty however when the terms of the agreements are public the most competitive royalty i e zero can also be bilaterally efficient policy implications regarding the antitrust treatment of cross licensing agreements are derived from these results

patents and cumulative innovation causal evidence from the courts cumulative innovation is central to economic growth do patent rights facilitate or impede such follow on innovation this paper studies the effect of removing patent protection through court invalidation on the subsequent research related to the focal patent as measured by later citations we exploit random allocation of judges at the u s court of appeal for the federal circuit to control for the endogeneity of patent invalidation we find that patent invalidation leads to a 50 percent increase in subsequent citations to the focal patent on average but the impact is highly heterogeneous patent rights appear to block follow on innovation only in the technology fields of computers electronics and medical instruments moreover the effect is entirely driven by invalidation of patents owned by large patentees that triggers entry of small innovators suggesting that patents may impede the democratization of innovation

the new patent intermediaries platforms defensive aggregators and super aggregators some assets are traded in liquid markets at transparent prices with the help ome assets are traded in liquid markets at transparent prices with the help of many thriving intermediaries houses and apartments stocks and other of many thriving intermediaries houses and apartments stocks and other fi nancial products books dvds electronics and all sorts of collectibles fi nancial products books dvds electronics and all sorts of collectibles

patent pools and cross licensing in the shadow of patent litigation this paper develops a framework to analyze the incentives to form a patent pool or engage in cross licensing arrangements in the presence of uncertainty about the validity and coverage of patents that makes disputes inevitable it analyzes the private incentives to litigate and compares them with the social incentives it shows that pooling arrangements can have the effect of sheltering invalid patents from challenges this result has an antitrust implication that patent pools should not be permitted until after patentees have challenged the validity of each other s patents if litigation costs are not too large

tying foreclosure and exclusion in recent years the leverage theory of tied good sales has faced heavy and influential criticism in an important sense though the models used by its critics are actually incapable of addressing the leverage theory s central concerns here the author reconsiders the leverage hypothesis and argues that tying can indeed serve as a mechanism for leveraging market power the mechanism through which this leverage occurs its profitability and its welfare implications are discussed in detail copyright 1990 by american economic association

domestic micro generation economic regulatory and policy issues for the uk abstract micro generation in individual homes has been the subject of increasing policy and industry attention in recent years whilst it has been estimated that micro generation could meet 30 40 of uk electricity demand by 2050 deployment to date has been slow in its micro generation strategy the uk government has started to outline how deployment could be increased various technical economic behavioural and institutional changes are needed to establish a uk market for micro generation this article discusses how different deployment models for domestic micro generation might attract investments in these technologies it considers not only investments by individual households but also by energy companies starting from an economic analysis of payback times for three different technologies micro chp micro wind and solar pv it identifies policy and regulatory recommendations it argues for technology specific support policies in the short term it also suggests that a level playing field for micro generation technologies as a result of fiscal and market reforms could considerably increase the attractiveness of micro generation technologies

optimal cross licensing arrangements collusion versus entry deterrence this paper analyzes optimal cross licensing arrangements between incumbent firms in the presence of potential entrants the optimal cross licensing royalty rate trades off incentives to sustain a collusive outcome vis a vis incentives to deter entry with the threat of patent litigation we show that a positive cross licensing royalty rate which would otherwise relax competition and sustain a collusive outcome dulls incentives to litigate against entrants our analysis can shed light on the puzzling practice of royalty free cross licensing arrangements between competing firms in the same industry as such arrangements enhance incentives to litigate against any potential entrants and can be used as entry deterrence mechanism

the price effects of international airline alliances abstract this paper provides evidence on the effect of international airline alliances on fares the main finding is that alliance partners charge interline fares that are approximately 25 percent below those charged by nonallied carriers according to our theoretical model the main source of this fare reduction is the internalization of a negative externality that arises from the uncoordinated choice of interline sub fares in the absence of an alliance the paper also looks for evidence of an anti competitive alliance effect in the gateway to gateway markets while the point estimates show that an alliance between two previously competitive carriers would raise fares by about 5 percent this effect is not statistically significant

the economics of distributed energy generation a literature review the uk electricity system is likely to face dramatic technical and institutional changes in the near future current uk energy policy focuses on the need for a clean affordable and secure energy supply decentralisation of the electricity system is recognised as one means of achieving efficient and renewable energy provision as well as addressing concerns over ageing electricity infrastructure and capacity constraints in this paper we provide a critical literature review of the economics of increased penetration of distributed energy generation we find that there exists a large volume of research considering the financial viability of individual distributed generation technologies and we are necessarily selective in our review of these studies given the wide variety of technologies that the definition of distributed generation encompasses however there are few studies that focus on the pure economics of individual or groups of distributed energy generators and even fewer still based on the economy wide aspects of distributed generation in view of this gap in the literature we provide suggestions for future research which are likely to be necessary in order adequately to inform public policy on distributed generation and its role in the future of uk energy supply

economic policy and the relative price of services in ldcs abstract low relative prices of nontraded services are a feature of developing economies recent explanations focus on structural issues such as factor endowments and returns to scale this paper argues that economic policy may also contribute to low ldc service prices in a three sector model with wage differentials financial repression unambiguously depresses both per capita real income and the price of nontraded goods in contrast to most current models tariffs and production subsidies can also depress nontraded goods prices

differentiated standards and patent pools we consider patent pool formation by owners of essential patents for differentiated standards that may be complements or substitutes in use pooling improves coordination in terms of royalty setting within a standard but provokes a strategic response from licensors in the competing standard we characterise the incentives to form and defect from pools within standards and show how pool formation and stability depend on competition between standards we also examine strategic patent pool formation by consortium standards and show that policies promoting compatibility of standards may increase or decrease welfare depending on the effects on the incentives to form pools

cooperating with competitors patent pooling and choice of a new standard abstract i examine the efficiency of patent pooling in a setting that allows for the interplay between the standards process in which owners of essential intellectual property ip develop a new product and the subsequent pooling decision in which ip prices are coordinated if one of the ip owners is also the incumbent of a product that employs the current competing standard referred to as overlapping ownership then the relationship among the ip owners will be both vertical through their ip and horizontal through their competing interests in the final products consumers are better off when ip owners cooperate even when these owners are effectively competitors because of lower prices and greater product variety consumers prefer however that the agreements not admit firms with overlapping ownership these results inform antitrust policy on cooperative agreements among competitors

collaborative promotion of technology standards and the impact on innovation industry structure and organizational capabilities evidence from modern patent pools this study explores the impact of modern patent pools inter organizational collaborative arrangements for promoting the adoption of technology standards on the rate of follow on innovations based on pooled technologies the vertical structure of associated industries and organizational capabilities of noncollaborating firms on one hand the formation of modern pools can boost follow on innovation by lowering the search negotiation and licensing costs associated with pooled standards on the other hand modern pools may decrease the incentives to invest in follow on innovations because of cannibalization risks and grant back provisions to the extent that modern pools succeed in establishing a dominant standard their collaborative nature and their reliance on markets for technology can reduce technological uncertainty and appropriation hazards hence triggering vertical disintegration in related industries moreover by establishing a dominant standard modern pools can effectively diminish the relati

patents and innovation evidence from economic history abstract what is the optimal system of intellectual property rights to encourage innovation empirical evidence from economic history can help to inform important policy questions that have been di

patent pools and innovation in substitute technologies evidence from the 19th century sewing machine industry patent pools which combine complementary patents of competing firms are expected to increase overall welfare but potentially discourage innovation in substitutes for the pool technology this article exploits a new historical data set on changes in patenting and firm entry for a clearly defined pool technology and substitutes in the 19th century sewing machine industry this analysis reveals a substantial increase in innovation for an albeit technologically inferior substitute technology historical evidence suggests that the creation of a pool diverted innovation toward an inferior substitute technology by creating differential license fees and litigation risks

financial development and the price of services this article explores the links between financial development and the low relative price of services in less developed countries ldcs the empirical phenomenon of services priced lower in ldcs than in developed countries dcs is now quite thoroughly documented in the data gathered by i kravis a heston and r summers in their important work with the united nations international comparison project following r mckinnon and e shaw recent work emphasizes the importance of financial development in successful economic growth 2 we use a simple three sector model with nontraded goods to trace causal connections between financial policies and the structure of relative prices using data on relative prices from the international comparison project study we show that the extent of financial repression is a significant predictor of the spread of relative service goods prices across nations at differing stages of development as well as among ldcs alone the term financial repression describes a set of policies that aim to extract revenue from the financial system and to use the financial system to funnel resources into specific sectors of the economy 3 governments can extract revenue via forced sales of government debt to the banking system this is usually accomplished through a variety of reserve requirements which in many ldcs exceed 50 of deposits 4 interest rate controls on both loan rates and deposit rates are used to channel credit to politically worthy sectors or to specific projects so that the implicit subsidy does not appear on the government s balance sheet rates of monetary growth inconsistent with sta

market failures and public policy industrial organization studies the exercise and control of market power to this purpose it builds models that capture the essence of the situation the predictions of the model can then be tested econometrically and possibly in the lab or the field in the end the reasonableness of and robustness to modeling assumptions and the quality of empirical fit determine how confident economists are in making recommendations to public decision makers for intervention and to companies for the design of their business model industrial organization has a long tradition first theoretical with the work of french engineer economists antoine augustin cournot 1838 and jules dupuit 1844 then policy oriented with the enactment of the sherman act 1890 and subsequent legislation then descriptive with the studies of the harvard school structure conduct performance comforting and refining the antitrust drive and finally skeptical with the chicago school the chicago school correctly pointed out the lack of underlying theoretical doctrine and went on to cast doubt on the whole edifice it however did not develop an alternative antitrust doctrine perhaps because

structural dynamics of innovation networks funded by the european union in the context of systemic innovation of the renewable energy sector innovation in the renewable energy re sector relies on the concept of systemic innovation which requires interaction between two innovation aspects technology exploration and market exploitation the european union eu has introduced political instruments for systemic re innovation by integrating resources from different thematic and geographic areas however using these instruments to establish an ecosystem for systemic innovation remains unexplored this study develops a framework for evaluating the systemic innovation performance of networks through a time series analysis of network structural properties overall eu funded innovation networks have not evolved in a systemic direction first the network exhibits densely connected local clusters for technology exploration and market exploitation of re innovation which are disconnected from each other over time the gap between the two phases has weakened with increasing connectivity but the local clusters supporting either explorative or exploitative activities have diminished the existing networking linkages among organizations are considered ineffective because their positions in the network tend to display a mismatch with their innovation patterns this research presents policy suggestions for optimizing the exploration and exploitation activities in the eu s funding program and their complementarities to establish a systemic innovation environment in the re sector

the role of patents in information and communication technologies a survey of the literature during the last few decades the number of patents in information and communication technologies has increased considerably an increasing number of patents and the associated fragmentation of ip rights have generated a series of potentially problematic consequences patent thickets royalty stacking the emergence of patent assertion entities increased patent litigation particularly around standard essential patents and the difficulties with defining fair reasonable and nondiscriminatory licensing terms are some of the most debated issues in the literature that we review in this paper we devote a specific section of our survey to patent quality currently one of the most debated issues surrounding the patent system in our analysis we mix theoretical and empirical arguments with a more policy oriented reasoning this allows us to better position the different issues in the relevant political and economic context

do patents work thickets trolls and antibiotic resistance this paper connects ideas from recent literature on the economics of intellectual property ip to address the question did the strengthening and broadening of ip rights from important patent policy changes in the us promote greater innovation the analysis rests on the theory of cumulative innovation which shows that if ip rights on a pioneer invention extend to follow on research and impediments to contracting exist then strengthening patents can actually reduce overall innovation recent empirical studies are consistent with the theory patents can significantly deter follow on research in complex technology areas where contracting is difficult computers electronics telecommunications but not in drugs chemicals and human genes i outline remedies from court decisions and antitrust policy for addressing inefficiencies from patent trolling patent thickets and the anti commons of fragmented ownership i then apply the analysis to the antibiotics market drawing on recent research to examine how patent and competition policies can be used to improve incentives for drug development in the battle against antibiotic resistance the literature provides persuasive evidence that the policy changes overreached in broadening and strengthening ip rights and reveals important patent reforms for improving the effectiveness of patent systems in the us and canada

should good patents come in small packages a welfare analysis of intellectual property bundling abstract intellectual property owners often hold the rights to several patents each of which is essential to make or use a product we compare the welfare properties of package licenses under which a licensee pays the same fee regardless of the number of technologies licensed with component licenses under which each technology is licensed separately and there is no quantity discount a central finding is that a long term package license can induce incentives to invent around patents and invest in complementary assets that are closer to their socially optimal levels than are those induced by a long term component license we also identify settings in which a short term license is a partial substitute for a package license and a prohibition on package licensing induces parties to adopt contracts that result in less efficient complementary investment because of hold up

the deployment of decentralised energy systems as part of the housing growth programme in the uk abstract the housing growth programme could offer an opportunity for accelerating the deployment of decentralised renewable energy systems dres in the uk the government hopes to leverage private sector investment into dres as part of new housing projects the aim of this paper is to assess whether current regulatory and funding frameworks are sufficient to achieve this the question is explored by drawing on the experience of developers local authorities energy utilities and service companies operating in the largest housing growth region in the uk thames gateway their experience suggests that the current low intervention approach will be insufficient to generate the shift required in both industries in order to be more successful economic and regulatory instruments should focus on producers house builders and energy providers rather than consumers households tighter regulation is needed to ensure that producers have a responsibility to install dres as part of new developments to enable connection to the grid to ensure a sustained financial return from investment and revenue is spent on the expansion of new renewable energy infrastructure this regulatory framework must be under pinned by substantial funds focused on producers greater intervention is needed if dres is to be included in new housing development

entry for buyout the possibility of buying out an entrant has an important effect on entry deterrence entrants can blackmail the incumbent by threatening to keep prices low and buyout can make entry profitable which otherwise would not be in particular the entry deterrence policy of excess capacity to reduce the post entry price can not only fail but work against the incumbent the presence of multiple oligopolistic incumbents or multiple potential entrants however can discourage entry for buyout the long literature on entry deterrence has always assumed that if entry is made unprofitable no entry will occur but as followers of professional football may have suspected a clearly unprofitable competitor might rationally enter a market in the hopes of selling out to the incumbent i will model such a situation and try to show what conditions facilitate entry for buyout in the simplest entry deterrence model the incumbent successfully maintains monopoly by threatening to expand output and cut price after other firms enter but he succeeds only because potential entrants believe the threat if entrants are rational this strategy fails price warfare hurts the incumbent as well as the entrant so the monopolist would let the entrant have a share of profits after entry potential entrants foreseeing the accommodating response ignore the threat deterred entry is a nash equilibrium but not a perfect nash equilibrium it is nash because the entrant chooses to stay out given the incumbent s strategy of cutting prices after entry and the incumbent does not mind committing himself to cutting prices given that entry never occurs a perfect nash equilibrium is a set of strategies that is a nash equilibrium for every proper subgame if the game is started at any of the nodes of the game tree including those off the equilibrium path the strategies the agents pick to maximize their objective function from that node onwards must be part of the equilibrium strategy for the entire game in the subgame which begins after entry has already occurred the incumbent would not choose to cut prices so cutting prices after entry is not part of a perfect equilibrium in the perfect equilibrium entry occurs and is accommodated

the negative impacts of the global economic downturn on funding decentralised energy in the uk abstract over the years a number of governmental policies have been developed in the uk that offer grants for the installation of distributed energy technologies or financial rewards per unit of electricity heat generated from renewable and sustainable sources the current economic climate however has meant that budget cuts have affected almost all government departments consequently such policies have been adversely impacted the alterations modifications to many schemes have resulted in either a reduction in the funding available through these changes to the eligibility of certain technologies or scales of generation or policy cancellations the programmes affected include the feed in tariff scheme renewable heat incentive and low carbon buildings programme among others the adjustments for these are detailed herein followed by the impacts these have had on the deployment rates of decentralised energy especially microgeneration since costs are often one of the most significant factors constraining deployment of these technologies reductions in funding opportunities have made these less financially viable whilst there are still applications for funding under the available schemes there has been considerably reduced levels of requests for financial support thus future deployment rates will most likely be negatively affected the prospects of these technologies in this context are then considered

world product and income international comparisons of real gross product the volume reports on the third phase of the united nations international comparison project icp the main results provide comparisons of real gross domestic product gdp per capita for thirty four countries in 1975 quantity and price comparisons are given also for personal consumption capital formation and public consumption and further subdivisions of final expenditures on gdp are estimated