Whom to license patented technology
AbstractThis paper examines the optimal licensing policy of a patent holder when potential licensees differ in their capacities in absorbing the patented technology. If two-part tariffs with non-negative royalties and fixed fees are feasible, the patent holder finds it optimal to license the strong firm exclusively whether or not an exclusive licensing of the weak firm deters the strong firm from entering the market. Hence, the potential trade-offs between strategic gains associated with licensing to weak competitors and efficiency gains associated with licensing to efficient competitors do not exist when two part tariffs are available. © 1998 John Wiley & Sons, Ltd.
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Bibliographic InfoArticle provided by John Wiley & Sons, Ltd. in its journal Managerial and Decision Economics.
Volume (Year): 19 (1998)
Issue (Month): 3 ()
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- Clark, Derek J. & Foros, Øystein & Sand, Jan Yngve, 2009.
"Foreclosure in contests,"
2008/27, Department of Business and Management Science, Norwegian School of Economics.
- Sharmila Vishwasrao, 2004.
"Royalties vs. fees: How do firms pay for foreign technology?,"
04023, Department of Economics, College of Business, Florida Atlantic University, revised Sep 2006.
- Vishwasrao, Sharmila, 2007. "Royalties vs. fees: How do firms pay for foreign technology?," International Journal of Industrial Organization, Elsevier, vol. 25(4), pages 741-759, August.
- Soo Jeoung Sohn, 2006. "Choosing the partners in the licensing alliance," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 27(4), pages 251-260.
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