Licensing the market for technology

Journal Article (Journal Article)

In technology-based industries, incumbent firms often license their technology to potential competitors. Such a strategy is difficult to explain within traditional models of licensing. This paper extends the literature on licensing by relaxing the assumption of a monopolist technology holder. Competition in the market for technology induces licensing of innovations and incumbent firms may find it privately profitable to license although their joint profits may well be higher in the absence of any licensing. A strong testable implication of our model is that the number of licenses per patent holder decreases with the degree of product differentiation. © 2003 Elsevier Science B.V. All rights reserved.

Full Text

Duke Authors

Cited Authors

  • Arora, A; Fosfuri, A

Published Date

  • October 1, 2003

Published In

Volume / Issue

  • 52 / 2

Start / End Page

  • 277 - 295

International Standard Serial Number (ISSN)

  • 0167-2681

Digital Object Identifier (DOI)

  • 10.1016/S0167-2681(03)00002-7

Citation Source

  • Scopus