Patents to Exclude vs. Include: Rethinking the Management of Intellectual Property Rights in a Knowledge-Based Economy

Abstract

Traditional patent theory emphasizes the importance of patents for excluding imitators. This view is far too restrictive and is at odds with many empirical and theoretical works. Therefore, we propose an analysis of patent management that considers the properties of knowledge-based economies explicitly. Patents are thus shown to be critical instruments for coordinating innovative activities between firms. They not only exclude potential infringers, but also “include” all the heterogeneous stakeholders of the innovation process. Patents facilitate coordination via two mechanisms: they encourage the emergence of markets for technology (market coordination) and they play an important role in formal and informal inter-firm collaboration (non-market coordination). We also link firms’ patenting strategy with the characteristics of the technological regime of their sector.

Keywords

• knowledge-based economy
• markets for technology
• Open innovation
• patents
• R&D collaboration