IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this paper

Trade and Industrial Policy Subtleties with International Licensing

  • ISHIKAWA Jota
  • OKUBO Toshihiro

We see various hybrid forms of organization and competition in which domestic and foreign firms may cooperate in some phases of production such as technology development and then compete in product markets. We assume that for a foreign firm to produce a good for export into its rival's domestic market, it has to acquire technology either through research and development (R&D) or licensing from the domestic firm. The domestic firm has an incentive to offer a licensing contract that deters the foreign firm from conducting its own R&D, but this in turn creates an interdependency not considered in the traditional literature. We show that both domestic and foreign optimal policies with licensing can be the exact opposite of optimal policies without licensing. Interestingly, by imposing an export tax on the "foreign" firm, the foreign government can shift the licensing revenue from the "domestic" firm.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.rieti.go.jp/jp/publications/dp/13e050.pdf
Download Restriction: no

Paper provided by Research Institute of Economy, Trade and Industry (RIETI) in its series Discussion papers with number 13050.

as
in new window

Length: 33 pages
Date of creation: Jun 2013
Date of revision:
Handle: RePEc:eti:dpaper:13050
Contact details of provider: Postal:
11th floor, Annex, Ministry of Economy, Trade and Industry (METI) 1-3-1, Kasumigaseki Chiyoda-ku, Tokyo, 100-8901

Phone: +81-3-3501-1363
Fax: +81-3-3501-8577
Web page: http://www.rieti.go.jp/
Email:


More information through EDIRC

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as in new window
  1. Ishikawa, Jota & Morita, Hodaka & Mukunoki, Hiroshi, 2008. "FDI in Post-Production Services and Product Market Competition," CCES Discussion Paper Series 1, Center for Research on Contemporary Economic Systems, Graduate School of Economics, Hitotsubashi University.
  2. Barbara J. Spencer & Ronald W. Jones, 1989. "Trade and Protection in Vertically Related Markets," NBER Working Papers 3023, National Bureau of Economic Research, Inc.
  3. Barbara J. Spencer & Ronald W. Jones, 1989. "Vertical Foreclosure and International Trade Policy," NBER Working Papers 2920, National Bureau of Economic Research, Inc.
  4. Ishikawa, Jota & Spencer, Barbara J., 1999. "Rent-shifting export subsidies with an imported intermediate product," Journal of International Economics, Elsevier, vol. 48(2), pages 199-232, August.
  5. Gallini, Nancy T, 1984. "Deterrence by Market Sharing: A Strategic Incentive for Licensing," American Economic Review, American Economic Association, vol. 74(5), pages 931-41, December.
  6. Ishikawa, Jota & Lee, Ki-Dong, 1997. "Backfiring tariffs in vertically related markets," Journal of International Economics, Elsevier, vol. 42(3-4), pages 395-423, May.
  7. Chen, Yongmin & Ishikawa, Jota & Yu, Zhihao, 2004. "Trade liberalization and strategic outsourcing," Journal of International Economics, Elsevier, vol. 63(2), pages 419-436, July.
  8. Arghya Ghosh & Souresh Saha, 2000. "Trade Policy in the Presence of Technology Licensing," Econometric Society World Congress 2000 Contributed Papers 0592, Econometric Society.
  9. Jota Ishikawa & Yoichi Sugita & Laixun Zhao, 2009. "Corporate Control, Foreign Ownership Regulations and Technology Transfer," The Economic Record, The Economic Society of Australia, vol. 85(269), pages 197-209, 06.
  10. Furusawa, Taiji & Higashida, Keisaku & Ishikawa, Jota, 2003. "What information is needed for welfare-enhancing policies under international oligopoly?," Japan and the World Economy, Elsevier, vol. 15(1), pages 31-46, January.
  11. Arora, Ashish & Fosfuri, Andrea, 2003. "Licensing the market for technology," Journal of Economic Behavior & Organization, Elsevier, vol. 52(2), pages 277-295, October.
  12. Mukherjee, Arijit & Pennings, Enrico, 2006. "Tariffs, licensing and market structure," European Economic Review, Elsevier, vol. 50(7), pages 1699-1707, October.
  13. Kabiraj, Tarun & Marjit, Sugata, 2003. "Protecting consumers through protection: The role of tariff-induced technology transfer," European Economic Review, Elsevier, vol. 47(1), pages 113-124, February.
  14. ISHIKAWA Jota & MORITA Hodaka & MUKUNOKI Hiroshi, 2014. "Trade Liberalization and Aftermarket Services for Imports," Discussion papers 14065, Research Institute of Economy, Trade and Industry (RIETI).
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:eti:dpaper:13050. 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: (NUKATANI Sorahiko)

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.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with 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 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.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.