Sharing patents with competitors may encourage innovation

Firms that make a previously patented innovation accessible to competitors increase overall likelihood of improving upon that breakthrough while also raising profits for the original innovator and market welfare, according to a study by a University at Buffalo economist.

The practice of free-licensing–giving up patent protection–corresponds to an evolutionary step in the study of patents and their effect on innovation, says the study’s author Gilad Sorek, assistant visiting professor of economics at UB.

Full Story: http://www.rdmag.com/News/2012/03/Policy-Industry-Study-Sharing-patents-with-competitors-may-encourage-innovation/