IDEAS home Printed from https://ideas.repec.org/p/tiu/tiutis/b39207f5-f27a-451d-9e2e-d4cd9fe880dc.html
   My bibliography  Save this paper

Price Commitments in Standard Setting under Asymmetric Information

Author

Listed:
  • Boone, Jan

    (Tilburg University, School of Economics and Management)

  • Schuett, Florian

    (Tilburg University, School of Economics and Management)

  • Tarantino, E.

    (Tilburg University, School of Economics and Management)

Abstract

Standards may create market power for the holders of standard essential patents (SEPs). To address these concerns, the literature advocates price commitments, whereby SEP holders commit to the maximum royalty they would charge were their technology included in the standard. We consider a setting in which a technology implementer holds private information about profitability. In this setting, price commitments increase efficiency not only by curbing SEP holders' market power, but also by alleviating distortions in the design of the royalty scheme. We derive conditions under which price commitments can be implemented using a simple royalty cap as used in practice.
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This abstract was borrowed from another version of this item.)
(This a
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Boone, Jan & Schuett, Florian & Tarantino, E., 2019. "Price Commitments in Standard Setting under Asymmetric Information," Other publications TiSEM b39207f5-f27a-451d-9e2e-d, Tilburg University, School of Economics and Management.
    • Handle: RePEc:tiu:tiutis:b39207f5-f27a-451d-9e2e-d4cd9fe880dc
    as

    Download full text from publisher

    File URL: https://repository.tilburguniversity.edu/bitstreams/30432e6e-99a5-49d6-b362-0b703e7f8db5/download
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Gastón Llanes & Joaquín Poblete, 2014. "Ex Ante Agreements in Standard Setting and Patent‐Pool Formation," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 23(1), pages 50-67, March.
    2. Josh Lerner & Haris Tabakovic & Jean Tirole, 2016. "Patent Disclosures and Standard-Setting," NBER Working Papers 22768, National Bureau of Economic Research, Inc.
    3. Joseph Farrell & Timothy Simcoe, 2012. "Choosing the rules for consensus standardization," RAND Journal of Economics, RAND Corporation, vol. 43(2), pages 235-252, June.
    4. Mathias Dewatripont & Patrick Legros, 2013. "‘Essential’ Patents, FRAND Royalties and Technological Standards," Journal of Industrial Economics, Wiley Blackwell, vol. 61(4), pages 913-937, December.
    5. Benjamin Chiao & Josh Lerner & Jean Tirole, 2007. "The rules of standard-setting organizations: an empirical analysis," RAND Journal of Economics, RAND Corporation, vol. 38(4), pages 905-930, December.
    6. Klaus M. Schmidt, 2014. "Complementary Patents and Market Structure," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 23(1), pages 68-88, March.
    7. Anne Layne‐Farrar & Gerard Llobet & Jorge Padilla, 2014. "Payments and Participation: The Incentives to Join Cooperative Standard Setting Efforts," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 23(1), pages 24-49, March.
    8. Nancy T. Gallini & Brian D. Wright, 1990. "Technology Transfer under Asymmetric Information," RAND Journal of Economics, The RAND Corporation, vol. 21(1), pages 147-160, Spring.
    9. repec:adr:anecst:y:1991:i:24:p:08 is not listed on IDEAS
    10. Richard Schmalensee, 2009. "Standard‐Setting, Innovation Specialists And Competition Policy," Journal of Industrial Economics, Wiley Blackwell, vol. 57(3), pages 526-552, September.
    11. Bekkers, Rudi & Catalini, Christian & Martinelli, Arianna & Righi, Cesare & Simcoe, Timothy, 2023. "Disclosure rules and declared essential patents," Research Policy, Elsevier, vol. 52(1).
    12. Klaus M. Schmidt, 2014. "Complementary Patents and Market Structure," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 23(1), pages 68-88, March.
    13. Daniel F Spulber, 2019. "Standard Setting Organisations and Standard Essential Patents: Voting and Markets," The Economic Journal, Royal Economic Society, vol. 129(619), pages 1477-1509.
    14. Gastón Llanes, 2019. "Ex-ante Agreements and FRAND Commitments in a Repeated Game of Standard-Setting Organizations," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 54(1), pages 159-174, February.
    15. Inés Macho-Stadler & David Perez-Castrillo, 1991. "Contrats de licences et asymétrie d'information," Annals of Economics and Statistics, GENES, issue 24, pages 189-208.
    16. Gastón Llanes & Joaquín Poblete, 2020. "Technology Choice and Coalition Formation in Standards Wars," Journal of Industrial Economics, Wiley Blackwell, vol. 68(2), pages 270-297, June.
    17. Bernhard Ganglmair & Luke M. Froeb & Gregory J. Werden, 2012. "Patent Hold-Up and Antitrust: How A Well-Intentioned Rule Could Retard Innovation," Journal of Industrial Economics, Wiley Blackwell, vol. 60(2), pages 249-273, June.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Schuett, Florian & Wipusanawan, Chayanin, 2023. "Essentiality Checks for Standard Essential Patents," Discussion Paper 2023-21, Tilburg University, Tilburg Law and Economic Center.
    2. Fu, Xiao & Tan, Guofu & Wang, Jin, 2023. "Policy orientations and technology choices in standards wars," International Journal of Industrial Organization, Elsevier, vol. 88(C).
    3. Pierre Larouche & Florian Schuett, 2019. "Repeated interaction in standard setting," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 28(3), pages 488-509, June.
    4. Justus Baron & Jorge Contreras & Martin Husovec & Pierre Larouche, 2019. "Making the Rules: The Governance of Standard Development Organizations and their Policies on Intellectual Property Rights," JRC Research Reports JRC115004, Joint Research Centre.
    5. Baron, Justus, 2020. "Counting standard contributions to measure the value of patent portfolios - A tale of apples and oranges," Telecommunications Policy, Elsevier, vol. 44(3).
    6. Justus Baron & Tim Pohlmann, 2018. "Mapping standards to patents using declarations of standard‐essential patents," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 27(3), pages 504-534, September.
    7. Lorenz Brachtendorf & Fabian Gaessler & Dietmar Harhoff, 2023. "Truly standard‐essential patents? A semantics‐based analysis," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 32(1), pages 132-157, January.
    8. Gastón Llanes, 2019. "Ex-ante Agreements and FRAND Commitments in a Repeated Game of Standard-Setting Organizations," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 54(1), pages 159-174, February.
    9. Antonin Bergeaud & Julia Schmidt & Riccardo Zago, 2022. "Patents that Match your Standards: Firm-level Evidence on Competition and Growth," Working papers 876, Banque de France.
    10. Spulber, Daniel F., 2016. "Patent licensing and bargaining with innovative complements and substitutes," Research in Economics, Elsevier, vol. 70(4), pages 693-713.
    11. Harhoff, Dietmar & Brachtendorf, Lorenz & Gaessler, Fabian, 2020. "Truly Standard-Essential Patents? A Semantics-Based Analysis," CEPR Discussion Papers 14726, C.E.P.R. Discussion Papers.
    12. Bernhard Ganglmair & Emanuele Tarantino, 2014. "Conversation with secrets," RAND Journal of Economics, RAND Corporation, vol. 45(2), pages 273-302, June.
    13. Dong HUO & Jiangwei DANG & Kazuyuki MOTOHASHI, 2019. "Empirical Analysis of License Policy for Declared Standard-essential Patents in Setting Technology Standards," Discussion papers 19023, Research Institute of Economy, Trade and Industry (RIETI).
    14. Gastón Llanes & Joaquín Poblete, 2020. "Technology Choice and Coalition Formation in Standards Wars," Journal of Industrial Economics, Wiley Blackwell, vol. 68(2), pages 270-297, June.
    15. Llanes, Gastón, 2024. "Innovation incentives in technical standards," International Journal of Industrial Organization, Elsevier, vol. 93(C).
    16. Gastón Llanes & Joaquín Poblete, 2014. "Ex Ante Agreements in Standard Setting and Patent‐Pool Formation," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 23(1), pages 50-67, March.
    17. Josh Lerner & Jean Tirole, 2015. "Standard-Essential Patents," Journal of Political Economy, University of Chicago Press, vol. 123(3), pages 547-586.
    18. Gandal, Neil & Regibeau, Pierre, 2013. "SSOs: Current Policy Issues and Empirical Evidence," Foerder Institute for Economic Research Working Papers 275825, Tel-Aviv University > Foerder Institute for Economic Research.
    19. Mathias Dewatripont & Patrick Legros, 2013. "‘Essential’ Patents, FRAND Royalties and Technological Standards," Journal of Industrial Economics, Wiley Blackwell, vol. 61(4), pages 913-937, December.
    20. David Martimort & Jean‐Christophe Poudou & Wilfried Sand‐Zantman, 2010. "Contracting For An Innovation Under Bilateral Asymmetric Information," Journal of Industrial Economics, Wiley Blackwell, vol. 58(2), pages 324-348, June.

    More about this item

    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • L15 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Information and Product Quality
    • L24 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Contracting Out; Joint Ventures

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:tiu:tiutis:b39207f5-f27a-451d-9e2e-d4cd9fe880dc. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Richard Broekman (email available below). General contact details of provider: https://www.tilburguniversity.edu/about/schools/economics-and-management/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.