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Publications
Publications
  • 2012
  • Working Paper
  • HBS Working Paper Series

The Impact of Modularity on Intellectual Property and Value Appropriation

By: Carliss Y. Baldwin and Joachim Henkel
  • Format:Print
  • | Language:English
  • | Pages:40
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Abstract

Modularity is a means of partitioning technical knowledge about a product or process. When state-sanctioned intellectual property rights are ineffective or costly to enforce, modularity can be used to hide information and thus protect intellectual property (IP). We investigate the impact of modularity on IP protection by formally modeling three different threats to the value of IP: unauthorized use by known agents, imitation or substitution by third parties, and the withdrawal of IP by agents or third-party owners. For each threat, we consider the impact of modularity in the presence or absence of an effective legal system. The models permit us to identify specific strategies for protecting IP and thus capturing value in modular systems. We illustrate each of the major strategies with examples from practice.

Keywords

Strategy; Open Source Distribution; Value; Complexity; Intellectual Property

Citation

Baldwin, Carliss Y., and Joachim Henkel. "The Impact of Modularity on Intellectual Property and Value Appropriation." Harvard Business School Working Paper, No. 12-040, December 2011. (Revised November 2012.)
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About The Author

Carliss Y. Baldwin

→More Publications

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    • 2021
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    Computer-Implemented Methods and Systems for Measuring, Estimating, and Managing Economic Outcomes and Technical Debt in Software Systems and Projects: US Patent 11,126,427 B2

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    Design Rules, Volume 2: How Technology Shapes Organizations: Chapter 6 The Value Structure of Technologies, Part 1: Mapping Functional Relationships

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More from the Authors
  • Computer-Implemented Methods and Systems for Measuring, Estimating, and Managing Economic Outcomes and Technical Debt in Software Systems and Projects: US Patent 11,126,427 B2 By: Daniel J. Sturtevant, Carliss Baldwin, Alan MacCormack, Sunny Ahn and Sean Gilliland
  • Design Rules, Volume 2: How Technology Shapes Organizations: Chapter 7 The Value Structure of Technologies, Part 2: Strategy without Numbers By: Carliss Y. Baldwin
  • Design Rules, Volume 2: How Technology Shapes Organizations: Chapter 6 The Value Structure of Technologies, Part 1: Mapping Functional Relationships By: Carliss Y. Baldwin
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