Research

Work in Progress

Secrecy vs. Patenting in Innovation Races, with Eugen Kovac

This study examines the tradeoff between patenting and secrecy in innovation races, considering a model where two firms simultaneously compete in developing two products that can be substitutes or complements. Patenting ensures a claim on the product but discloses information to rivals, while secrecy may delay immediate profits for future technology leadership. We find that firms have more incentives to patent if they are impatient and if there are no significant technological spillovers. In a scenario where firms are patient and moderate technological spillovers exist, they exhibit a greater tendency to patent products acting as perfect complements rather than perfect substitutes. These findings are in line with the empirical evidence by Cohen, Nelson, and Walsh (2000), who argue that firms are more likely to keep the innovation secret in "simple" industries, where goods have many potential substitutes, as opposed to "complex" industries, where a new product involves many complementary components.

Working Papers

Revealing Private Information in a Patent Race (Slides), with Eugen Kovac

In this paper we investigate the role of private information in a patent race. Since firms often do their research in secrecy, the standard assumption in the patent race literature that firms know each other's position in the race is questionable. We analyze how the dynamics of the game changes when a firm's progress is its private information. Further, we address the question whether revealing it might be to a firm's advantage. We find that a firm has an incentive to reveal its breakthrough only if its rival has not done so, and only if research is inefficient.

Multi-Player Discrete All-pay Auctions

In this paper I study all-pay common-value auctions in which bids are restricted to non-negative integers. I prove that the game has unique symmetric Nash equilibrium in mixed strategies given that there are three or more players. Although players bid on average lower as more players are present, they always randomize on the whole set of bids smaller than the value of the prize, so long as there is sufficiently enough players. Players always receive a positive expected payoff which is bounded by a constant regardless of how large the value of the prize is. Finally, I prove that in limit the equilibrium converges to the equilibrium of a continuous all-pay auction.