Contracting for tacit knowledge: The provision of technical services in technology licensing contracts
Recent research on the economic payoff from new technology has emphasized the importance of tacit knowledge or know-how. This paper shows that arm's length contract can overcome the problems in contracting for know-how by bundling complementary inputs with know-how in a technology package, and leveraging the superior enforceability of contracts over the latter. In the empirical part of this paper, the relationship between bundling and transfer of know-how is analyzed, using Indian data. The results imply that tied sales of inputs may increase the efficiency of contracts involving the transfer of know-how. A striking result, in the context of the current North-South debates on intellectual property rights, is the packaging of patents with know-how.
Duke Scholars
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- Development Studies
- 4404 Development studies
- 3801 Applied economics
- 1402 Applied Economics
Citation
Published In
DOI
ISSN
Publication Date
Volume
Issue
Start / End Page
Related Subject Headings
- Development Studies
- 4404 Development studies
- 3801 Applied economics
- 1402 Applied Economics