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Patentability Requirements and the Direction of Innovation

Fabio M. Manenti & Luca Sandrini

The Journal of Industrial Economics2025https://doi.org/10.1111/joie.12414article
AJG 3ABDC A*
Weight
0.37

Abstract

We model a duopolistic game where firms first choose the direction of their innovation, then invest in the chosen direction, and finally, compete in the product market. Investments occur either in overlapping or non‐overlapping territories. We show that, in the presence of a generous patent regime that allows the protection of innovations of little value, firms tend to invest in overlapping technologies; stricter requirements for patentability may induce firms to operate in different technological areas, thereby increasing market efficiency. We illustrate our general theory using two stylized models of Cournot competition with product and process innovations, respectively.

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https://doi.org/https://doi.org/10.1111/joie.12414

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@article{fabio2025,
  title        = {{Patentability Requirements and the Direction of Innovation}},
  author       = {Fabio M. Manenti & Luca Sandrini},
  journal      = {The Journal of Industrial Economics},
  year         = {2025},
  doi          = {https://doi.org/https://doi.org/10.1111/joie.12414},
}

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Patentability Requirements and the Direction of Innovation

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Evidence weight

0.37

Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.16 × 0.4 = 0.06
M · momentum0.53 × 0.15 = 0.08
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.