Optimal Licensing in a Spatial Model
AbstractWe analyze a multi-stage non-cooperative game involving an outside patent-holder, who seeks to licence a process innovation, and two price-setting firms located on a circumference. Three licensing policies are studied: the auction, the fixed fee and the per unit output royalty. The main finding is that, contrary to standard results, royalties yield higher payoffs to the patent-holder than do an auction policy or a fixed fee policy regardless of the size of the innovation. Besides, a conflict between private and social interests arises since consumers are better off when the technology is licensed via fees.
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Bibliographic InfoArticle provided by ENSAE in its journal Annals of Economics and Statistics.
Volume (Year): (2002)
Issue (Month): 66 ()
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- Ménière, Yann & Parlane, Sarah, 2008. "Decentralized of licensing of complementary patents: comparing royalty, fixed fee and two part tariff," PIE/CIS Discussion Paper 383, Center for Intergenerational Studies, Institute of Economic Research, Hitotsubashi University.
- Rabah Amir & David Encaoua & Yassine Lefouili, 2013. "Optimal Licensing of Uncertain Patents in the Shadow of Litigation," UniversitÃ© Paris1 PanthÃ©on-Sorbonne (Post-Print and Working Papers) halshs-00847955, HAL.
- MAULEON, Ana & VANNETELBOSCH, Vincent & VERGARI, Cecilia, 2010. "Bargaining and delay in patent licensing," CORE Discussion Papers 2010077, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
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