Apurva Dey, Arun Kumar Kaushik, Rupayan Pal

Probabilistic Patents, Alternative Damage Rules, and Optimal Tariffs

Volume 176 () / Issue 2, pp. 276-311 (36)
Published 11.12.2019

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This paper analyzes interdependences between optimal trade policy and preferred liability doctrine to assess infringement damages, when intellectual property rights are probabilistic, in a model of import competition between a foreign patentee and a domestic infringer. It shows two reversal results. First, a regime switch from protectionism to free trade reverses stakeholders' preferences over liability doctrines. Second, the optimal trade policy changes from an import tariff under the lost-profit rule to import subsidization under the unjust-enrichment rule, unless the patent is weak. It is found that free trade is not optimal, except for a few knife-edge cases.

Apurva Dey No current data available.

Arun Kumar Kaushik No current data available.

Rupayan Pal No current data available.