Patents, Antitrust, and Innovation: Evidence from the Xerox Case
[Latest Version] [CRC Discussion Paper]
Conditionally Accepted at Journal of Industrial Economics
Non-technical summary: ProMarket
Winner of the CRESSE-CCIA Young Researcher Award for the Best Paper on the Digital Economy, 2025
Finalist at the Young Talent Competition Award at the Lear Competition Festival, 2023
Abstract: How does antitrust enforcement affect innovation when patents are the main barrier to entry? I address this question by empirically studying the US antitrust case against Xerox, the former monopolist in the market for plain-paper copiers. In 1975, Xerox accepted a consent decree whose primary remedy was compulsory licensing of all its copier-technology patents in the US and abroad. I show that this antitrust intervention promoted innovation by other firms in the copier industry, measured by a disproportionate increase in patenting in technology classes with a higher propensity for containing copier-related inventions. This positive effect is driven by increased innovation by Japanese competitors. Their patenting became more novel and diverse, as they started developing smaller desktop copiers.
Imperfect Price Information, Market Power, and Tax Pass-Through
(with Felix Montag, Alina Sagimuldina, and Monika Schnitzer)
[Latest Version] [Stigler Center Working Paper] [CRC Discussion Paper]
Non-technical summary: ProMarket
Abstract: Pass-through determines how consumers respond to Pigouvian taxes or unconventional fiscal policy. We investigate the impact of imperfect price information on pass-through of commodity taxes. Our theoretical model predicts that the pass-through rate increases with the share of well-informed consumers. Pass-through is higher for the minimum price, paid by well-informed consumers, than for the average price, paid by uninformed consumers. Moreover, pass-through to the average price is non-monotonic with respect to the number of sellers. An empirical analysis of multiple recent tax changes in the German and French retail fuel markets supports these predictions.