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Tariffs, technology licensing and adoption

Author

Listed:
  • Chen, Hsiu-Li
  • Hwang, Hong
  • Mukherjee, Arijit
  • Shih, Pei-Cyuan

Abstract

This paper develops a two-country Cournot duopoly model to investigate the implications of international technology licensing. It is shown that if the tariff imposed by the domestic country is high, it is optimal for the foreign firm to adopt an inferior technology for its production when it licenses its most advanced technology to the domestic firm. Such a licensing arrangement may improve welfare of the two countries.

Suggested Citation

  • Chen, Hsiu-Li & Hwang, Hong & Mukherjee, Arijit & Shih, Pei-Cyuan, 2016. "Tariffs, technology licensing and adoption," International Review of Economics & Finance, Elsevier, vol. 43(C), pages 234-240.
    • Handle: RePEc:eee:reveco:v:43:y:2016:i:c:p:234-240
    DOI: 10.1016/j.iref.2016.02.012
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    References listed on IDEAS

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    Cited by:

    1. Yan, Qingyou & Yang, Le, 2018. "Optimal licensing schemes for a mixed ownership firm when facing uncertain R&D outcomes and technology spillover," International Review of Economics & Finance, Elsevier, vol. 58(C), pages 550-572.
    2. Wu, Cheng-Han & Kao, Yi-Jhe, 2018. "Cooperation regarding technology development in a closed-loop supply chain," European Journal of Operational Research, Elsevier, vol. 267(2), pages 523-539.
    3. Ya‐Po Yang & Ying‐Yi Tsai & Su‐Ying Hsu, 2021. "Technology licensing, entry mode, and trade liberalization," Review of Development Economics, Wiley Blackwell, vol. 25(2), pages 834-853, May.

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    More about this item

    Keywords

    Licensing; Technology adoption; Tariffs;
    All these keywords.

    JEL classification:

    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L24 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Contracting Out; Joint Ventures
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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