Journal Article The Establishment of the Jute Industry: A Problem of Location Theory? Get access Dennis Chapman Dennis Chapman St. Andrews Search for other works by this author on: Oxford Academic Google Scholar The Review of Economic Studies, Volume 6, Issue 1, October 1938, Pages 33–55, https://doi.org/10.2307/2967537 Published: 01 October 1938

Ideas are difficult to sell when buyers cannot assess an idea's value before it is revealed and sellers cannot protect a revealed idea. These problems exist in a variety of intellectual property sales ranging from pure ideas to poorly protected inventions and reflect the nonverifiability of key elements of an intellectual property sale. An expropriable partial disclosure can be used as a signal, allowing the seller to obtain payment based on the value of the remaining (undisclosed) know-how. We examine contracting after the disclosure and find that seller wealth is pivotal in supporting a partial disclosure equilibrium and in determining the payoff size.