(The) effect of patent scope on patentee's disclosure under information asymmetry : in social planner's perspectives

Abstract

This study is aimed at finding socially efficient patent scope, especially focusing on how patent scope as a government``s policy variable works and under what circumstances widening or narrowing patent scope will be socially efficient. In contrast to existing researches, this study deals with the possibility of a patentee``s keeping parts of innovation secret during applying for patent, since only a patentee knows all about his innovation and then perfect disclosure of patented innovation may reduce his future profits by severe competition, which is socially favorable in view of the increase in consumer surplus. Therefore, government should design adequate patent scope scheme to encourage a patentee to disclose completely. In this study, adverse selection model is used to find the optimal patent system under such information asymmetry.