Analysis and Modeling of "Imitation-Protection" Behavior in an Advantageous Situation of Patent Holders

The primary goal of this research is the trait and interaction of patent imitation and protection when the patent institution takes sides with the patent holders. The method used in this paper is game theoretic models, including basic model and leader-follower model. Results from the model show, that the holders will protect their patent actively while the competitors will still infringe to a certain extent. Invaders will have opportunities on condition that the cost of protection appears exorbitant to the holders. Further results from the leader-follower model suggest that, in an advantageous situation of patent holders, the emphasized protection-intention will be regarded as a noncredible-threat. Furthermore, the paradox that "the likelihood of entry increases with the penalty" does not appear in this situation.