Economic Analysis of Network Effects and Intellectual Property

104 Pages Posted: 4 Jun 2019

Multiple version iconThere are 2 versions of this paper

Date Written: May 13, 2019


The information revolution has brought demand-side effects to the fore of economic activity, business strategy, and intellectual property jurisprudence and policy. Intellectual property doctrines play a central role in harnessing network effects, promoting innovation to overcome excess inertia, and balancing consumer welfare, competition, and innovation. This Article surveys and integrates the economic, business strategy, and legal literatures relating to network effects and intellectual property. Part I introduces the topic of network effects and provides an overview of the Article. Part II describes the functioning of network markets. Part III examines the interplay of business strategy, contract, standard setting organizations, intellectual property, and competition policy. Part IV presents three principles for tailoring intellectual property regimes and competition policy to network technologies. Part V traces the evolution of intellectual property protection for network features of systems and platforms. Part VI discusses the interplay of intellectual property protection and competition policy. Part VII assesses the extent to which intellectual property protection and competition policy align with the normative design principles. Part VIII identifies promising areas for future research.

Keywords: Network Effects, Interoperability, Intellectual Property, Patent, Copyright, Trademark, Antitrust

JEL Classification: D23, D85, K10, K21, K29, L40, L86

Suggested Citation

Menell, Peter S., Economic Analysis of Network Effects and Intellectual Property (May 13, 2019). Berkeley Technology Law Journal, Vol. 34, No. 1, 2019, Available at SSRN:

Peter S. Menell (Contact Author)

UC Berkeley School of Law ( email )

2240 Bancroft Way
Berkeley, CA 94720-7200
United States

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