The Role of Fixed Fee and Royalty in Patent Licensing
AbstractWe consider a monopolistic screening model of patent licensing. There is one patentee and one licensee and the patentee wishes to sell a patent of cost reducing technology to the licensee. The patentee is an outsider and the licensee is the only firm in the product market. The licensee possesses private information about the market demand which is unknown to the patentee except for some prior belief about it. In this scenario, we find the linear optimal licensing contract.
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Bibliographic InfoPaper provided by National University of Singapore, Department of Economics in its series Departmental Working Papers with number wp0211.
Date of creation: 2002
Date of revision:
licensing; fixed fee; royalty; adverse selection;
Find related papers by JEL classification:
- D43 - Microeconomics - - Market Structure and Pricing - - - Oligopoly and Other Forms of Market Imperfection
- D45 - Microeconomics - - Market Structure and Pricing - - - Rationing; Licensing
- L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
- L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
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