Patent and Knowhow Licensing in Japan (Japanese)
AbstractOver the past two decades, utilizing markets for technology through licensing and other outsourcing arrangements has emerged as a key to organizing innovative activity. We examine how the rent dissipation effect affects patent and knowhow licensing, controlling organizational capabilities such as firm size, vertical integration, exports, and diversity. A licensor's profit varies and the incentives to license change depending on the rent dissipation effect, which erodes a licensor's profit due to intensifying competition that results from a licensee's entry into the licensor's market. Firms faced with severe competition are marginally exposed to a small rent dissipation effect when licensing their technologies out to rivals, and they can obtain large royalty revenues through such licensing because there are many potential licensees. Using panel data on about ten thousand Japanese firms for the period 1995-2007, we show that the rent dissipation effect facilitates licensing not only between Japanese firms but also between Japanese and foreign firms.
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Bibliographic InfoPaper provided by Research Institute of Economy, Trade and Industry (RIETI) in its series Discussion Papers (Japanese) with number 11012.
Length: 42 pages
Date of creation: Feb 2011
Date of revision:
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Postal: 11th floor, Annex, Ministry of Economy, Trade and Industry (METI) 1-3-1, Kasumigaseki Chiyoda-ku, Tokyo, 100-8901
Web page: http://www.rieti.go.jp/
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This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-06-04 (All new papers)
- NEP-COM-2011-06-04 (Industrial Competition)
- NEP-INO-2011-06-04 (Innovation)
- NEP-IPR-2011-06-04 (Intellectual Property Rights)
- NEP-TID-2011-06-04 (Technology & Industrial Dynamics)
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