IDEAS home Printed from
   My bibliography  Save this article

Profit Improving via Strategic Technology Sharing


  • Kao Kuo-Feng

    (Department of Industrial Economics, Tamkang University, New Taipei City, Taiwan, Province of China)

  • Peng Cheng-Hau

    () (Department of Economics, Fu Jen Catholic University, 510, Zhongzheng Road, Xinzhuang District, New Taipei City 24205, Taiwan, Province of China)


This paper investigates whether a downstream monopolist has an incentive to freely share its technology to potential entrants. With a linear demand, it is more profitable for the downstream monopolist to share its obsolete technology with the potential entrants even with no returns. In this context, technology sharing is a Pareto improvement. Moreover, the profit of the downstream monopolist via technology sharing increases with the number of new entrants, but the nexus between social welfare and the number of new entrants is non-monotonic.

Suggested Citation

  • Kao Kuo-Feng & Peng Cheng-Hau, 2016. "Profit Improving via Strategic Technology Sharing," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 16(3), pages 1321-1336, September.
  • Handle: RePEc:bpj:bejeap:v:16:y:2016:i:3:p:1321-1336:n:6

    Download full text from publisher

    File URL:
    Download Restriction: For access to full text, subscription to the journal or payment for the individual article is required.

    As the access to this document is restricted, you may want to search for a different version of it.

    More about this item


    strategic technology sharing; successive monopoly; vertically-related markets; welfare;

    JEL classification:

    • L12 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Monopoly; Monopolization Strategies
    • L24 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Contracting Out; Joint Ventures


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bpj:bejeap:v:16:y:2016:i:3:p:1321-1336:n:6. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Peter Golla). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.