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According to economic theory, the ability of a company to sustain profits in the long term is based on having barriers to entry to their market. This kind of p
by btilly 7y ago
According to economic theory, the ability of a company to sustain profits in the long term is based on having barriers to entry to their market. This kind of patent threat is a barrier to entry, and suffering on the losing end of them is rent on the profit margin that they have been able to sustain.
Therefore, even with these losses, the patent system is worthwhile for them.
- mirimir 7y agoTrue. But barriers to market entry is also a prong for establishing monopoly power. So it cuts both ways.