DP1951 Patents in a Model of Endogenous Growth
|Author(s):||Edward O'Donoghue, Josef Zweimüller|
|Publication Date:||August 1998|
|Keyword(s):||Innovation, intellectual property, patent design, patent policy|
|JEL(s):||O31, O34, O38|
|Programme Areas:||Industrial Organization|
|Link to this Page:||cepr.org/active/publications/discussion_papers/dp.php?dpno=1951|
This paper examines patent protection in an endogenous-growth model. Our aim is two-fold. First, we show how the patent policies discussed by the recent patent-design literature can influence R&D in the endogenous-growth framework, where the role of patents has been largely ignored. Second, we explore how the general-equilibrium framework contributes to the results of the patent-design literature. In a general-equilibrium model, both incentives to innovate and monopoly distortions depend on the proportion of industries that conduct R&D. Furthermore, patents affect the allocation of R&D resources across industries, and patents can distort resources away from industries where they are most productive.