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Review of Law & Economics

Editor-in-Chief: Parisi, Francesco

Ed. by Cooter, Robert D. / Gómez Pomar, Fernando / Kornhauser, Lewis A. / Parchomovsky, Gideon / Engel, Christoph

3 Issues per year

CiteScore 2016: 0.22

SCImago Journal Rank (SJR) 2016: 0.197
Source Normalized Impact per Paper (SNIP) 2016: 0.355

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Volume 2, Issue 2 (Sep 2006)


Trade Secret vs. Broad Patent: The Role of Licensing

Franco Cugno / Elisabetta Ottoz
Published Online: 2006-09-08 | DOI: https://doi.org/10.2202/1555-5879.1069

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).

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Published Online: 2006-09-08

Citation Information: Review of Law & Economics, ISSN (Online) 1555-5879, DOI: https://doi.org/10.2202/1555-5879.1069.

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©2011 Walter de Gruyter GmbH & Co. KG, Berlin/Boston. Copyright Clearance Center

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