Game theory suggests that, in the absence of patents, the privately motivated innovation decisions of firms might lead to:
A)too little innovation.
B)too much innovation.
C)the socially efficient level of innovation.
D)none of the statements associated with this question are correct.

Question

Quizplus · Accepted Answer

In the absence of patents, firms may not be able to fully capture the benefits of their innovation through higher prices or market exclusivity, which can lead to a reluctance to invest in innovative activities, resulting in too little innovation.

Game Theory Suggests That, in the Absence of Patents, the Privately