Using Economics Experiments to Understand Patent Licensing Behavior

To successfully compete in today’s globalized economy, agribusiness firms need to innovate. Innovation enables firms to produce new and/or differentiated products/services that satisfy specialized consumer demands, and enables firms to generate cost reducing processes to out-compete rivals in domestic and international food markets. Firms will engage in innovative activities if they are able to recoup research and development (R&D) costs and capture innovation rents, so it is critical that they are able to identify the optimal strategies of protecting and profiting from their innovations.