Pankaj Tandon

Optimal Patents with Compulsory Licensing

This paper examines the use of compulsory lincensing as a policy to combat the monopoly problem associated with the patent system. It introduces the notion of an optimal patent--one where the patent life and the licensing royalty rate are both determined optimally. Under certain simplifying assumptions it is shown that the optimal patent will have an indefinite life, for both process and product innovations. Some preliminary calculations suggest that the use of compulsory licensing may lead to substantial welfare improvements, even if the patent life is left unchanged at 17 years.

Rivalry and the Excessive Allocation of Resources to Research

This article presents a simple probability model of R&D which suggests that competitive firms may overinvest resources in research, even in the face of uncertainty, inappropriability and increasing costs of research. In the presence of uncertainty, some duplication of R&D efforts may be justified because of the increased probability of success that results, but competitive equilibria may be characterized by excessive duplication. Further, when different firms can discover different things, excessive knowledge may be produced, even when each firm individually performs less R&D than is socially desirable. This is a consequence of excessive entry.

The Identity of Prakāśāditya

One of the enduring open questions in ancient Indian history is the identity of the king who identifies himself on the reverse of his gold coins as prakāśāditya . Most authors have assumed that he was a Gupta king. This paper reviews the various proposals on the identity of Prakāśāditya, arguing why we can be quite sure, as suggested by Robert Gobl, that he was in fact a Hun king and not a Gupta. Then, by presenting a near-complete reading of the obverse legend, it is shown that it is virtually certain that he was in fact the Hun king Toramāṇa, as Gobl had speculated. Implications of this finding are then considered.

The Succession after Kumāragupta I

Most dynastic lists of the Gupta kings state that Kumāragupta I was succeeded by Skandagupta. However, it is widely accepted that Skandagupta did not accede to the throne peacefully. Nor is it certain that the succession was immediate, since there is a gap between the known dates of Kumāraguptas and Skandaguptas reigns. This paper is concerned with the events following the death of Kumāragupta, using numismatic evidence as the primary source, and inscriptional and other epigraphic evidence as further support. Some of the numismatic evidence is new, and even the evidence that is not new has so far received little attention in the literature on the succession after Kumāragupta. Questions are raised about one particular theory that is presently enjoying some currency, that Skandagupta was challenged primarily by his uncle Ghaṭotkacagupta. Some other possible scenarios for the political events in the period after the death of Kumāragupta I will then be proposed and analyzed.

An Integrated Approach to the Theory of Externalities: An Expository Article

Traditional treatments of the theory of externalities deal separately with the output market and the “market” for effluents and have no simple geometric way to show the inter-relationships between them. This paper presents an integrated approach with a novel geometric presentation that shows these inter-relationships clearly, thereby allowing for a clearer exposition of the relationship between Pigouvian commodity taxes and effluent charges. For example, it becomes easy to show that optimal effluent charges function effectively as Pigouvian commodity taxes, but that the implicit tax rates are lower. The geometric treatment would be suitable for use in Intermediate level classes.

A note on optimal pricing of publicly produced intermediate inputs

In a recent paper, Rhodes and Sampath (hereafter R-S [ 1985(b)]) claim to have proved a remarkable result: that the optimal price of a publicly-produced input may be lower than marginal cost in a world where a revenue constraint is the only apparent distortion. ~ Although the idea that optimal prices may differ from marginal cost in a second-best world is well-known, the R-S result is remarkable because Ramseyprices, i.e., optimal prices in the face of revenue constraints, are generally greater than or equal to marginal cost2 To find Ramsey prices lower than marginal costs would, therefore, contradict the established literature. Upon careful examination, it turns out that the R-S result is incorrect; the established wisdom is reconfirmed.