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Trade Secret vs. Broad Patent: The Role of Licensing (2006)

Cugno, Franco ; Ottoz, Elisabetta

Berkeley, Calif. : Berkeley Electronic Press (now: De Gruyter)

Review of law and economics 2.2006, 2, art3

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ISSN: 1555-5879

Source: Berkeley Electronic Press Academic Journals

Topics: Law , Economics

Notes: We present a simple model wherein a patents regime is inferior to a trade secrets system, meaning that when private returns from innovation under the two regimes are the same, society will be better off if the innovator chooses not to patent. In our model, trade secret licensing is envisaged and the inferiority of patents depends on the lack of an independent invention defense in patent law, while such a defense currently exists in secrecy and copyright law. Thus, although secrecy is superior to patents, it is not superior to other types of formal intellectual property rights where independent invention is allowed (such as copyrighted software).

Type of Medium: Electronic Resource

URL: http://www.bepress.com/rle/vol2/iss2/art3

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