In recent years, the increasing awarding of patents has captured
the attention of scholars operating in different fields. Economic
literature has studied the causes of this proliferation; we
propose an entry game focusing on one of the consequences, showing
how an incumbent may create a patent portfolio in order to
control market entry and to collude. The incumbent fixes the
level of patent protection and the threat of denunciation reduces
the entrant’s expected profits; moreover, if the entrant deviates
from collusion, the incumbent can strengthen punishment suing
the competitor for patent infringement, reducing her incentive to
deviate. Our analysis suggests that antitrust authorities should
pay attention to the level of patent protection implemented by
the incumbent and note whether the holder of a patent reacts to
entry by either suing or not suing the competitor. In the model,
we use completely general functional forms in analyzing the issues,
and this allows us to obtain general results not depending
on the assumptions about the kind of oligopolistic competition
