Visibility of Technology and Cumulative Innovation: Evidence from Trade Secrets Laws

51 Pages Posted: 10 Jun 2019 Last revised: 8 Feb 2022

See all articles by Bernhard Ganglmair

Bernhard Ganglmair

ZEW – Leibniz Centre for European Economic Research - Junior Research Group Competition and Innovation; Mannheim Centre for Competition and Innovation (MaCCI); University of Mannheim - Department of Economics

Imke Reimers

Northeastern University - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: February 8, 2022

Abstract

Innovation depends on the incentives to create new ideas as well as the visibility of and access to existing ones. Using exogenous variation from the Uniform Trade Secrets Act, we show that stronger trade secrets protection has a disproportionately negative effect on patenting of less visible inventions (processes). We develop a framework of initial and follow-on innovation to determine the welfare effects of such shifts in disclosure. Stronger trade secrets may have negative effects on overall welfare by reducing opportunities for follow-on innovation, and optimal trade secrets policy depends on visibility, costs of R&D, and the value of cumulative innovation.

Keywords: cumulative innovation, disclosure, self-disclosing inventions, Uniform Trade Secrets Act

JEL Classification: D80, O31, O34

Suggested Citation

Ganglmair, Bernhard and Reimers, Imke, Visibility of Technology and Cumulative Innovation: Evidence from Trade Secrets Laws (February 8, 2022). ZEW - Centre for European Economic Research Discussion Paper, Available at SSRN: https://ssrn.com/abstract=3393510 or http://dx.doi.org/10.2139/ssrn.3393510

Bernhard Ganglmair

ZEW – Leibniz Centre for European Economic Research - Junior Research Group Competition and Innovation ( email )

L7,1
Mannheim, 68161
Germany

Mannheim Centre for Competition and Innovation (MaCCI) ( email )

L 7, 1
Mannheim, 68131
Germany

University of Mannheim - Department of Economics ( email )

D-68131 Mannheim
Germany

Imke Reimers (Contact Author)

Northeastern University - Department of Economics ( email )

301 Lake Hall
Boston, MA 02115
United States

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
197
Abstract Views
1,455
rank
161,248
PlumX Metrics