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Compulsory licensing of technology and the essential facilities doctrine

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  • Aoki, Reiko
  • Small, John

Abstract

We consider compulsory licensing of intellectual property as a remedy for anticompetitive practices. We identify aspects of intellectual property that could warrant a different remedy from those developed for access to physical essential facilities. Based on the analysis, we present a characterisation of optimal compulsory licensing for a simple market. We find that royalty payments offer a greater range of choices to a regulator than fixed fees. Thus, even though the marginal cost of supplying access to intellectual property is zero, some unit charging is likely to be efficient.
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  • Aoki, Reiko & Small, John, 2004. "Compulsory licensing of technology and the essential facilities doctrine," Information Economics and Policy, Elsevier, vol. 16(1), pages 13-29, March.
    • Handle: RePEc:eee:iepoli:v:16:y:2004:i:1:p:13-29
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    1. Armstrong, Mark & Doyle, Chris & Vickers, John, 1996. "The Access Pricing Problem: A Synthesis," Journal of Industrial Economics, Wiley Blackwell, vol. 44(2), pages 131-150, June.
    2. Aoki, Reiko & Tauman, Yair, 2001. "Patent licensing with spillovers," Economics Letters, Elsevier, vol. 73(1), pages 125-130, October.
    3. Reiko Aoki & Sadao Nagaoka, 2002. "The Utility Standard and the Patentability of Basic Research," CIRJE F-Series CIRJE-F-160, CIRJE, Faculty of Economics, University of Tokyo.
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    Cited by:

    1. Nitya Nanda & Ratnakar Adhikari & Puspa Sharma & Paras Kharel, 2012. "Trade and climate change : South Asian agenda at the UNFCCC and the WTO," Regional Economic Integration: Challenges for South Asia during turbulent times (Edited volume), in: Saman Kelegama (ed.), Regional Economic Integration : Challenges for South Asia during turbulent times (Edited volume), edition 1, volume 1, chapter 13, pages 227-251, South Asia Watch on Trade, Economics and Environment.
    2. Cugno Franco & Ottoz Elisabetta, 2006. "Static Inefficiency of Compulsory Licensing: Quantity vs. Price Competition," Department of Economics and Statistics Cognetti de Martiis. Working Papers 200606, University of Turin.
    3. Sarmah, Archita & De Giovanni, Domenico & De Giovanni, Pietro, 2020. "Compulsory licenses in the pharmaceutical industry: Pricing and R&D strategies," European Journal of Operational Research, Elsevier, vol. 282(3), pages 1053-1069.

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    More about this item

    JEL classification:

    • K2 - Law and Economics - - Regulation and Business Law
    • L4 - Industrial Organization - - Antitrust Issues and Policies

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