Revealing private information in a patent race

0544754 - NHÚ 2022 RIV CZ eng V - Research Report
Kocourek, Pavel
Revealing private information in a patent race.
Prague: CERGE-EI, 2021. 56 s. CERGE-EI Working Paper Series, 693. ISSN 1211-3298
EU Projects: European Commission(XE) 770652 - BEHAVFRICTIONS
Institutional support: RVO:67985998
Keywords : patent race * R&D investment * optimal effort
OECD category: Applied Economics, Econometrics
https://www.cerge-ei.cz/pdf/wp/Wp693.pdf

In this paper I investigate the role of private information in a patent race. Since firms often do their research in secrecy, the common assumption in patent race literature that firms know each other’s position in the race is questionable. I analyze how the dynamics of the game changes when a firm’s progress is its private information, and I address the question whether revealing it might be to a firm’s advantage. I find that a firm has an incentive to reveal its breakthrough only if its rival has not done so, and only if the research is costly.
Permanent Link: http://hdl.handle.net/11104/0321574