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Abstract
The paper examines the relationship between the innovator’s patenting and patent breadth decisions
as well as how these two decisions affect, and are affected by, the innovator’s ability to enforce her
patent rights. An important feature of the model is that the entrant may be able, by his choice of
location in product space, to affect the innovator’s decision to defend her patent. An interesting
finding of the paper is that the innovator might find it optimal to patent her innovation even when
she chooses to not defend her patent by invoking a trial when patent infringement occurs. The paper
also shows that, in most cases, the greater is the entrant’s R&D effectiveness, the smaller is the
innovator’s incentive to patent her product. If patenting occurs, however, the greater is R&D
effectiveness, the greater is the patent breadth that could be chosen without triggering infringement.