Mackenrodt, Mark-Oliver --- "Assessing the Effects of Intellectual Property Rights in Network Standards" [2008] ELECD 246; in Drexl, Josef (ed), "Research Handbook on Intellectual Property and Competition Law" (Edward Elgar Publishing, 2008)

Book Title: Research Handbook on Intellectual Property and Competition Law

Editor(s): Drexl, Josef

Publisher: Edward Elgar Publishing

ISBN (hard cover): 9781845420475

Section: Chapter 4

Section Title: Assessing the Effects of Intellectual Property Rights in Network Standards

Author(s): Mackenrodt, Mark-Oliver

Number of pages: 25

Extract:

4 Assessing the effects of intellectual property
rights in network standards
Mark-Oliver Mackenrodt



1 Introduction
This chapter analyses the effects of intellectual property protection on innova-
tion in network markets. Assessing the pro-competitive and anti-competitive
effects of intellectual property rights (IPRs) can provide important information
for legal policy in several situations. Most importantly, an assessment of the
economic effects of intellectual property rights is warranted if the optimal
design of an intellectual property right is to be determined. Further, one might
consider resorting to a competitive-effects analysis in the application and
construction of intellectual property law in order to incorporate economic
learning into decision making.1 Finally, the pro-competitive and anti-compet-
itive effects of intellectual property protection are determinative in the appli-
cation of antitrust law to business strategies that include the use of intellectual
property rights.2
It is the main objective of intellectual property law to create incentives for
innovation. However, while they increase dynamic competition, intellectual
property rights also lead to a decrease in static competition. The concepts of
static competition and dynamic competition are introduced in section 2 infra.
Competitive pressure and incentives that are provided by intellectual property
law both serve to induce innovation (see section 3 infra). The competitive
pressure as well as the effects of intellectual property rights are determined by
market mechanisms. In network industries, market mechanisms exhibit
specific features as compared to conventional markets (see section 4 infra). In
network markets, intellectual property rights exhibit ...