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Strategic Behaviour of Firms in a Duopoly and the Impact of Extending the Patenting Period

Brown, H., Hole, A.R. and Roberts, J. (2010) Strategic Behaviour of Firms in a Duopoly and the Impact of Extending the Patenting Period. Working Paper. Department of Economics, University of Sheffield ISSN 1749-8368

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Abstract

This paper deals with strategic behaviour of firms in a duopoly, subsequent to the claim by one firm that it has reduced the unit cost of production. A variety of possible strategic equilibria are discussed in the context of a duopoly game between a multinational and a local firm. In the context of an extended uniform period of patenting, as finally agreed in the Uruguay round (1994), firms have increased incentive to take patents. In the presence of cost differences, the act of taking process-patents has implications for the equilibrium output strategies of the duopoly firms and sometimes may have a negative overall welfare effect for the local producer and consumers.

Item Type: Monograph (Working Paper)
Copyright, Publisher and Additional Information: The Sheffield Economics Research Paper (SERP) series offers a forum for the research output of the academic staff and research students of the Department of Economics, University of Sheffield. Papers are reviewed for quality and presentation by a departmental editor. However, the contents and opinions expressed remain the responsibility of the authors. All papers may be downloaded free on the understanding that the contents are preliminary and therefore permission from the author(s) should be sought before they are referenced.
Keywords: Asymmetric Information, Duopoly, Process Patenting, Repeated Games
Institution: The University of Sheffield
Academic Units: The University of Sheffield > Faculty of Social Sciences (Sheffield) > Department of Economics (Sheffield) > Sheffield Economics Research Papers Series
Depositing User: Repository Officer
Date Deposited: 16 Jun 2010 13:28
Last Modified: 22 Jun 2014 07:43
Published Version: http://www.shef.ac.uk/economics/research/serps/yea...
Status: Published
Publisher: Department of Economics, University of Sheffield
Identification Number: Sheffield Economic Research Paper Series 2010014
URI: http://eprints.whiterose.ac.uk/id/eprint/10899

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