From the antitrust case law that governs restrictions on patent licenses, we derive three unifying principles: just reward, profit neutrality and minimalism. The just-reward principle holds that the patentholder's profits should be earned, if at all, from the social value created by his...

We consider a model of the innovative environment where there is a distinction between ideas for R\&D investments and the investments themselves. We investigate the optimal reward policy and how it depends on whether ideas are scarce or obvious. By foregoing investment in a current idea, society...

We consider a model of the innovative environment where there is a distinction between ideas for R&D investments and the investments themselves. We investigate the optimal reward policy and how it depends on whether ideas are scarce or obvious. By foregoing investment in a current idea, society...

Inventors and users of technology often enter into cooperative agreements for sharing their intellectual property in order to implement a standard or to avoid costly litigation. Over the past two decades, U.S. antitrust authorities have viewed pooling arrangements that integrate complementary,...

We consider a model of the innovative environment where there is a distinction between ideas for R&D investments and the investments themselves. We investigate the optimal reward policy and how it depends on whether ideas are scarce or obvious. By foregoing investment in a current idea, society...

We study several interconnected problems that arise under the current U.S. patent system when a patent covers one component or feature of a complex product. This situation is common in the information technology sector of the economy. Our analysis applies to cases involving reasonable royalties,...

Very large awards and settlements for patent infringement have increased dramatically since the 1980s. A large fraction of these awards have occurred in the computer hardware and software industries. Complex technologies such as computer hardware and software require rights to a very large...

This paper studies royalty negotiations between a patent holder and a downstream firm selling a product which is more valuable if it includes a feature covered by the patent. Royalties are negotiated in the shadow of patent litigation, which will determine whether or not the patent is valid and...