Davidson Heath, University of Utah
Davidson Heath, University of Utah
The Dark Side of Brand Protection
The Dark Side of Brand Protection
01 May 20181:30 PM – 3:00 PM
Faculty and doctoral students only
We study the effects of trademark protection on firm profits and strategy. Using diff-in-diff
and switching estimates around the passage and nullification of the Federal Trademark
Dilution Act (FTDA) we find that from 1996 to 2002 the FTDA raised treated firms’
operating profits by 12% of their baseline, and was followed by a spike in trademark
lawsuits and lower entry and higher industry concentration. Firms granted stronger
trademark protection reduced both product quality and innovation and extended their
protected brands into all-new product markets.
Location:
Baker Library | Bloomberg Center 101
Organizer:
We study the effects of trademark protection on firm profits and strategy. Using diff-in-diff and switching estimates around the passage and nullification of the Federal Trademark Dilution Act (FTDA) we find that from 1996 to 2002 the FTDA raised treated firms’ operating profits by 12% of their baseline, and was followed by a spike in trademark lawsuits and lower entry and higher industry concentration. Firms granted stronger trademark protection reduced both product quality and innovation and extended their protected brands into all-new product markets.