The Role of Patent Rights in Mergers: Consolidation in Plant Biotechnology

Few micro-level empirical papers have addressed the impact of the patent system on industry structure. Using firm-level patent data for public and private firms in plant biotechnology, we develop a measure of patent enforceability. Duration models show that patent statistics are a useful predictor of the timing of merger activity. We find that patent enforceability is an important factor influencing the likelihood of mergers. Mergers in plant biotechnology may be partially motivated by the enforcement of patent rights when firms have overlapping technologies; some of the merger activity may be explained by attempts to avoid mutually blocking technology, as exemplified in the case of Roundup Ready corn.


Issue Date:
2007
Publication Type:
Working or Discussion Paper
PURL Identifier:
http://purl.umn.edu/7193
Total Pages:
57
Series Statement:
CUDARE Working Paper
1036




 Record created 2017-04-01, last modified 2017-08-23

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