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Third Parties and Contract Design: The Case of Contracts for Technology Transfer

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  • Valérie Duplat
  • Fabrice Lumineau

Abstract

Given the challenges associated with drafting technology‐transfer contracts, we examine decisions to involve third parties offering technical or legal support in the contract‐drafting process. We first argue that the attributes of the transaction are key drivers of third‐party involvement. We then draw on the behavioral theory of the firm to develop arguments regarding the influence of third parties on contract complexity. Our results reveal that the involvement of legal third parties tends to magnify the contract's overall complexity. In contrast, the involvement of technical third parties reduces the inclusion of monitoring provisions and increases the inclusion of coordination provisions. Copyright © 2015 John Wiley & Sons, Ltd.

Suggested Citation

  • Valérie Duplat & Fabrice Lumineau, 2016. "Third Parties and Contract Design: The Case of Contracts for Technology Transfer," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 37(6), pages 424-444, September.
    • Handle: RePEc:wly:mgtdec:v:37:y:2016:i:6:p:424-444
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    Cited by:

    1. Shen, Lu & Su, Chenting & Zheng, Xu & Zhuang, Guijun, 2019. "Contract design capability as a trust enabler in the pre-formation phase of interfirm relationships," Journal of Business Research, Elsevier, vol. 95(C), pages 103-115.
    2. Sébastien Brion & Elodie Gardet, 2018. "For a contingent approach of conflict resolution mechanisms: the case of innovation networks," Post-Print hal-01771604, HAL.
    3. Keld Laursen & Solon Moreira & Toke Reichstein & Maria Isabella Leone, 2017. "Evading the Boomerang Effect: Using the Grant-Back Clause to Further Generative Appropriability from Technology Licensing Deals," Organization Science, INFORMS, vol. 28(3), pages 514-530, June.
    4. Massimo G. Colombo & Evila Piva, 2019. "Knowledge misappropriation risks and contractual complexity in entrepreneurial ventures’ non-equity alliances," Small Business Economics, Springer, vol. 53(1), pages 107-127, June.

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