artículo
Innovation incentives in technical standards
Fecha
2024Registro en:
10.1016/j.ijindorg.2024.103046
1879-1972
01677187
MEDLINE:34479354
SCOPUS_ID:85182725436
WOS:000422677600229
Autor
Llanes G.
Institución
Resumen
© 2024 Elsevier B.V.I study the incentives to develop complementary technologies and include them in a technical standard. I find that the standardization process may lead to insufficient or excessive innovation. Patent pools increase innovation incentives, while price caps may increase or decrease them. Although both policies increase user surplus and welfare, price caps dominate (are dominated by) patent pools if the incremental value of technologies is small (large). Preventing the coordination of price caps guarantees that the socially-optimal policy is implemented in equilibrium. However, from innovators' perspective, patent pools are more profitable than price caps. This finding helps explain why patent pools are more prevalent than price caps, even though price caps may imply higher welfare. Cooperative R&D agreements increase innovation and welfare when technologies are highly complementary. The paper's results contribute to the discussion of the effects of recent policy changes in the VITA and IEEE standard-setting organizations.