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Make-or-Buy Decisions in Patent Related Services

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  • Wagner, Stefan

Abstract

Among the most prominent theoretical frameworks dealing with the economic underlyings of firms’ make-or-buy decisions are Transaction Cost Economics (TCE) and the Resourced Based View (RBV). Relying on panel data covering 107 European firms over eight years I test predictions from both TCE and RBV with regard to the outsourcing of patent related services simultaneously. Modelling the share of outsourced patent applications in a Negative Binomial Panel Regression Model I find joint explanatory power of both approaches. My findings support previous literature arguing for an integration of TCE and RBV to a comprehensive theoretical framework of firms make-or-buy decisions.

Suggested Citation

  • Wagner, Stefan, 2006. "Make-or-Buy Decisions in Patent Related Services," Discussion Papers in Business Administration 1264, University of Munich, Munich School of Management.
  • Handle: RePEc:lmu:msmdpa:1264
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    File URL: https://epub.ub.uni-muenchen.de/1264/1/Wagner_mob.pdf
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    References listed on IDEAS

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    1. Klein, Benjamin & Crawford, Robert G & Alchian, Armen A, 1978. "Vertical Integration, Appropriable Rents, and the Competitive Contracting Process," Journal of Law and Economics, University of Chicago Press, vol. 21(2), pages 297-326, October.
    2. Manuel Trajtenberg & Rebecca Henderson & Adam Jaffe, 1997. "University Versus Corporate Patents: A Window On The Basicness Of Invention," Economics of Innovation and New Technology, Taylor & Francis Journals, pages 19-50.
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    4. Erin Anderson & David C. Schmittlein, 1984. "Integration of the Sales Force: An Empirical Examination," RAND Journal of Economics, The RAND Corporation, pages 385-395.
    5. Wesley M. Cohen & Richard R. Nelson & John P. Walsh, 2000. "Protecting Their Intellectual Assets: Appropriability Conditions and Why U.S. Manufacturing Firms Patent (or Not)," NBER Working Papers 7552, National Bureau of Economic Research, Inc.
    6. Shelanski, Howard A & Klein, Peter G, 1995. "Empirical Research in Transaction Cost Economics: A Review and Assessment," Journal of Law, Economics, and Organization, Oxford University Press, vol. 11(2), pages 335-361, October.
    7. Abraham, Katharine G & Taylor, Susan K, 1996. "Firms' Use of Outside Contractors: Theory and Evidence," Journal of Labor Economics, University of Chicago Press, vol. 14(3), pages 394-424, July.
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    10. Richard C. Levin & Alvin K. Klevorick & Richard R. Nelson & Sidney G. Winter, 1987. "Appropriating the Returns from Industrial Research and Development," Brookings Papers on Economic Activity, Economic Studies Program, The Brookings Institution, pages 783-832.
    11. Richard C. Levin & Alvin K. Klevorick & Richard R. Nelson & Sidney G. Winter, 1988. "Appropriating the Returns from Industrial R&D," Cowles Foundation Discussion Papers 862, Cowles Foundation for Research in Economics, Yale University.
    12. Harhoff, Dietmar & Hoisl, Karin, 2007. "Institutionalized incentives for ingenuity--Patent value and the German Employees' Inventions Act," Research Policy, Elsevier, pages 1143-1162.
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    More about this item

    Keywords

    outsourcing; patent attorney; make-or-buy; negative binomial panel regression;

    JEL classification:

    • L24 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Contracting Out; Joint Ventures
    • L22 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Organization and Market Structure

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