Intellectual Property Law and the Boundaries of the Firm
New York University School of Law
University of Pennsylvania Law School; Bar Ilan University - Faculty of Law
June 24, 2004
U of Penn, Inst for Law & Econ Research Paper 04-19; Harvard Law and Economics Discussion Paper No. 480
Arrow's disclosure paradox implies that information that is not afforded legal protection cannot be bought or sold on the market. This paper emphasizes the important relationship between the paradox of disclosure and the boundaries of the firm question. Only legally protected inventions, i.e., patented inventions, may be traded; pre-patent stages of the innovation process may not. Consequently, by force of law, rather than by the guidance of economic principle, pre-patent innovation must be carried out within the boundaries of a single firm.
Number of Pages in PDF File: 11
Keywords: Boundaries of the firm, disclosure paradox, intellectual property law
JEL Classification: D23, K11, L22working papers series
Date posted: June 29, 2004
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