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On Technology Transfer to an Asymmetric Cournot Duopoly

Author

Listed:
  • X. Henry Wang

    (University of Missouri-Columbia)

  • Bill Yang

    (Georgia Southern University)

Abstract

This note studies the transfer of a cost-reducing innovation from an independent patent-holder to an asymmetric Cournot duopoly that has different unit costs of production. It is found that royalty licensing can be superior to fixed-fee licensing for the independent patent-holder.

Suggested Citation

  • X. Henry Wang & Bill Yang, 2004. "On Technology Transfer to an Asymmetric Cournot Duopoly," Economics Bulletin, AccessEcon, vol. 4(14), pages 1-6.
    • Handle: RePEc:ebl:ecbull:eb-04d40009
    as

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    File URL: http://www.accessecon.com/pubs/EB/2004/Volume4/EB-04D40009A.pdf
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    References listed on IDEAS

    as
    1. Morton I. Kamien & Yair Tauman, 1986. "Fees Versus Royalties and the Private Value of a Patent," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 101(3), pages 471-491.
    2. Wang, X. Henry, 1998. "Fee versus royalty licensing in a Cournot duopoly model," Economics Letters, Elsevier, vol. 60(1), pages 55-62, July.
    3. Kenneth Arrow, 1962. "Economic Welfare and the Allocation of Resources for Invention," NBER Chapters, in: The Rate and Direction of Inventive Activity: Economic and Social Factors, pages 609-626, National Bureau of Economic Research, Inc.
    4. Macho-Stadler, Ines & Martinez-Giralt, Xavier & David Perez-Castrillo, J., 1996. "The role of information in licensing contract design," Research Policy, Elsevier, vol. 25(1), pages 43-57, January.
    5. Marie Thursby & Richard Jensen, 2001. "Proofs and Prototypes for Sale: The Licensing of University Inventions," American Economic Review, American Economic Association, vol. 91(1), pages 240-259, March.
    6. Ana I. Saracho, 2002. "Patent Licensing Under Strategic Delegation," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 11(2), pages 225-251, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
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    Cited by:

    1. Fridtjof Anderson, 2014. "Licensing to a More Efficient Rival," Manchester School, University of Manchester, vol. 82(6), pages 653-676, December.
    2. Kuang-Cheng Andy Wang & Ching-Chih Tseng & Wen-Jung Liang, 2016. "Patent Licensing in the Presence of Trade Barriers," The Japanese Economic Review, Japanese Economic Association, vol. 67(3), pages 329-347, September.
    3. Kuang-Cheng Andy Wang & Dang-Long Bui & Yi-Jie Wang & Wen-Jung Liang, 2023. "International licensing under an endogenous tariff in vertically-related markets," Journal of Economics, Springer, vol. 139(2), pages 93-123, July.
    4. Hsiao-chi Chen & Shiou Shieh & Pu-ti Su, 2010. "Fees versus Royalties under Partial Cross Ownership," Economics Bulletin, AccessEcon, vol. 30(4), pages 3248-3259.
    5. repec:ebl:ecbull:v:4:y:2006:i:10:p:1-10 is not listed on IDEAS
    6. Chin-Sheng Chen, 2017. "Endogenous Market Structure and Technology Licensing," The Japanese Economic Review, Springer, vol. 68(1), pages 115-130, March.
    7. Belleflamme,Paul & Peitz,Martin, 2015. "Industrial Organization," Cambridge Books, Cambridge University Press, number 9781107069978.
    8. Banerjee, Swapnendu & Poddar, Sougata, 2019. "‘To sell or not to sell’: Licensing versus selling by an outside innovator," Economic Modelling, Elsevier, vol. 76(C), pages 293-304.
    9. Sandro Gleave & Eberhard Feess, 2006. "Patent Licensing and Price Discrimination," Economics Bulletin, AccessEcon, vol. 4(10), pages 1-10.
    10. Drouard, Joeffrey, 2022. "Content-distribution strategies in markets with locked-in customers," International Journal of Industrial Organization, Elsevier, vol. 80(C).
    11. Kuang-Cheng Andy Wang & Ching-Chih Tseng & Wen-Jung Liang, 2016. "Patent Licensing in the Presence of Trade Barriers," The Japanese Economic Review, Springer, vol. 67(3), pages 329-347, September.
    12. Chin-Sheng Chen, 2017. "Endogenous Market Structure and Technology Licensing," The Japanese Economic Review, Japanese Economic Association, vol. 68(1), pages 115-130, March.
    13. Sinha, Uday Bhanu, 2016. "Optimal value of a patent in an asymmetric Cournot duopoly market," Economic Modelling, Elsevier, vol. 57(C), pages 93-105.
    14. Takeshi Ebina & Shin Kishimoto, 2012. "How to license a public licensor's technology to an asymmetric duopoly," Economics and Business Letters, Oviedo University Press, vol. 1(2), pages 16-26.

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    More about this item

    Keywords

    Cournot duopoly;

    JEL classification:

    • D4 - Microeconomics - - Market Structure, Pricing, and Design
    • L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior

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