Does shareholder overlap alleviate patent holdup? - new publication by Harald Hau
Patent protection can generate holdup problems for follow-on innovators when technologies protected in early patents complement their inventions.
In a new study, Professor Harald Hau investigates whether institutional shareholder overlap between firms with precursory patents and follow-on innovators can reduce such patent holdup problems.
Using patent citation links to track complementary patents, Hau and his co-authors find empirical support for such a holdup attenuation hypothesis of institutional shareholder overlap. Follow-on innovators with greater institutional shareholder overlap to precursory patent owners enjoy greater success with their patent portfolio, face less
patent conflict as measured by patent litigation, and feature higher levels of R&D investments. The holdup attenuation effect is stronger if product complexity makes securing ex ante patent licenses more difficult.
The paper is co-authored with Heng Geng, Sandy Lai, and Pengfei Liu, and is forthcoming in Research Policy, the leading international journal for research on innovation and technological progress.
Jan 16, 2025