Choix d’innovation Diomides Mavroyiannis To cite this version: Diomides Mavroyiannis. Choix d’innovation. Economics and Finance. Université Paris sciences et lettres, 2019. English. NNT : 2019PSLED065. tel-03222300 HAL Id: tel-03222300 https://tel.archives-ouvertes.fr/tel-03222300 Submitted on 10 May 2021 HAL is a multi-disciplinary open access L’archive ouverte pluridisciplinaire HAL, est archive for the deposit and dissemination of sci- destinée au dépôt et à la diffusion de documents entific research documents, whether they are pub- scientifiques de niveau recherche, publiés ou non, lished or not. The documents may come from émanant des établissements d’enseignement et de teaching and research institutions in France or recherche français ou étrangers, des laboratoires abroad, or from public or private research centers. publics ou privés. Préparée à Université Paris-Dauphine Innovation and choice Soutenue par Composition du jury : Diomides Mavroyiannis Olivier Bos Le 12 Décembre 2019 Université Panthéon-Assas Rapporteur Sara Biancini Université de Cergy-Pontoise Rapporteur École doctorale no543 Frederic Loss École doctorale de Dauphine Université Paris-Dauphine Examinateur Claire Chambolle INRA President du jury Spécialité David Ettinger Université Paris-Dauphine Directeur de thèse Sciences économiques Contents 0.1 The origins on the debate about private property...............6 0.1.1 What is a property right?........................8 0.1.2 The language of property rights.....................8 0.2 The static economics of property rights..................... 14 0.2.1 Coasian paradigm............................. 17 0.3 The Dynamic creation of property rights.................... 20 0.3.1 Incomplete contracting.......................... 24 0.4 Intellectual Property............................... 28 0.4.1 Assumptions of intellectual property.................. 31 0.4.2 Mechanism Design............................ 36 0.4.3 Scope and evidence............................ 38 0.5 Contrbutions in this thesis............................ 41 0.5.1 First chapter............................... 41 0.5.2 Second chapter.............................. 42 0.5.3 Third chapter............................... 43 1 Piracy and network value 45 1.1 Introduction.................................... 45 1.2 Literature review................................. 48 1.3 The model..................................... 49 1.4 Preliminary Analysis............................... 51 1 2 CONTENTS 1.5 Solving the model................................. 53 1.5.1 Equilibrium when r=0, no piracy cost.................. 53 1.5.2 Equilibrium when r is high....................... 54 1.5.3 Does the firm prefer the high product degradation case or the no prod- uct degradation case?.......................... 55 1.5.4 Equilibrium for intermediate values of the cost of piracy....... 56 1.6 Extension: Endogenous product improvement................. 59 1.7 Discussion and Conclusion............................ 61 1.8 Appendix..................................... 65 1.8.1 Buyers and pirates............................ 65 1.8.2 Proof of proposition2.......................... 66 1.8.3 Proof of proposition3.......................... 67 1.8.4 Proof of proposition4.......................... 69 1.9 Endogenous k................................... 71 1.9.1 case where r = 0 ............................. 71 1.9.2 Intermediate r............................... 72 1.9.3 Some values for k............................. 72 1.9.4 Notes................................... 73 2 Cost-side innovation with project variance 78 2.1 Introduction.................................... 78 2.2 Link to the literature............................... 80 2.3 Setup........................................ 81 2.3.1 The dynamic model............................ 81 2.3.2 Sequential................................. 84 2.3.3 Radical.................................. 85 2.3.4 The willingness to lobby for buyouts.................. 90 2.4 Applications:................................... 93 CONTENTS 3 2.4.1 Ex-ante buyout.............................. 93 2.4.2 Ex-post Bertrand............................. 94 2.4.3 Ex-Post Cournot............................. 98 2.4.4 Static case: Reduced form version of the Coasian argument...... 99 2.5 Discussion..................................... 101 2.6 Conclusion..................................... 103 2.6.1 Sequential................................. 106 2.6.2 Radical.................................. 107 2.6.3 Proof of proposition 20.......................... 108 3 Microfoundations of Discounting 110 3.1 Introduction.................................... 110 3.1.1 Background................................ 110 3.1.2 Our model – growth rate maximization................. 112 3.1.3 Related literature............................. 113 3.2 Theoretical Framework.............................. 115 3.2.1 Problem definition............................ 115 3.2.2 Model setup................................ 117 3.3 Results....................................... 119 3.3.1 Specification................................ 119 3.3.2 Case A – Fixed time frame with additive dynamics.......... 121 3.3.3 Case B – Fixed time frame with multiplicative dynamics....... 121 3.3.4 Case C – Adaptive time frame with additive dynamics........ 122 3.3.5 Case D – Adaptive time frame with multiplicative dynamics..... 124 3.4 Discussion..................................... 128 .1 The Transitivity of Growth Rate Maximization................ 131 Bibliography 133 Dedication This thesis is dedicated to my mother. I came to Paris to feel closer to her. 4 Acknowledgements They say it takes a village, but each village has a chief. My chief in this endeavor was my supervisor, Mr. David Ettinger. David took me under his wing after only a few emails and a quick coffee. He has been a consistent source of encouragement and has always been willing to discuss. David helped me revise my first chapter more than a few dozen times and has demonstrated endless patience against my argumentativeness. He was also instrumental in putting together the ideas for the second chapter. Throughout our time working together I have come to deeply respect this exceedingly clever character who never gets angry, who likes to joke and has the bravery to take on large bureaucracy. I would like to thank all the people who were kind enough to be critical of my work and point out points that needed to be elaborated. Sidartha Gordon, gave me helpful feedback at my presentation in Dauphine on my second chapter. Andras Nidermeyer also gave me necessary comments. Frederic Loss and Anna creti have been patiently following my progress throughout the years helping me improve. Olivier Bos and Sarah Biancini feedback on my first two chapters helped motivate me for the final year of work. Noemie Cabau, Morgan Patty were similarly obliging for my introduction and Philipe Lefort for my third chapter. In addition I would like to help thank my co-authors for my third chapter, Alexander Adamou, Yonatan Berman, and Ole Peters who apart from being endlessly supportive, flew me over to London so we could discuss the concept for an uninterrupted period. I would especially like to thank Yonatan Berman for his night dedication to polish the paper. I would like to thank everyone who has been around and made these years enjoyable. I would especially like to thank, Arnold Njike, Christian Tekam, Emy Lecurier, Morgan Patty, Char- lotte Scoufflaire, Doriane Mignon, Noemie Cabau, Alexis Dottin, Lexane Webber, Maroua Riabi, Sandra Pellet and Sarah Morcillo. Finally, I would like to thank my immediate family: Athena, Andreas and Nino for their wisdom and helping me keep myself in one piece. 5 Introduction The goal of this introduction will be to give the reader a general initiation as to how economics treats property rights and how this relates to intellectual property. Most of the discussion is aimed at summarizing the relevant literature but some commentary is original. Section 0.1 delves into the roots of the debate and the modern legal language way of discussing such rights. Section 2.4.4 aims to give some brief definitions of the kind of efficiencies economists concern themselves with, and to discuss how these notions apply to the Coase theorem and property rights. Dynamic aspects of property rights and incomplete contracts are elaborated in section 2.3.1. Finally some comments on economic arguments of intellectual property are reviewed in section 0.4. 0.1 The origins on the debate about private property The roots of the debate about property rights originate from Ancient Greece through its two most revered philosophers, Plato and Aristotle. Plato’s most famous work, the Republic, is a treatise on an idealized society, one that has managed to halt to a minimum its own deterioration from the perfect form. Plato’s view of property rights is purely instrumental in that it is something that will help maintain the ideal society from deteriorating. His conception of ownership is as an important source of corruption that creates clannish self- interest and considers the panacea of this influence to be the abolition of private property. Aristotle takes a stand against Plato, his former teacher, in being one of the first defenders of private property. In "Politics", Aristotle reasons that without private property people would interfere in each other’s affairs without being motivated by love. He views the act of waiving your rights to property against an individual as a way to be virtuous. Consequently, a limitation