Innovation, Licensing and Welfare

Arijit Mukherjee

Industrial Organization from EconWPA

Abstract: This paper examines how the option for licensing affects research and development (R&D) and social welfare. We find that if cost reduction from R&D is sufficiently small and there is an option of licensing, firms will do non-cooperative R&D. In absence of licensing, firms will do cooperative R&D for sufficiently small cost reduction from R&D. Whether the option for licensing increases social welfare is ambiguous. If the possibility of licensing increases probability of success in R&D significantly then welfare is higher in presence of licensing.

Keywords: Cooperative R&D; Licensing; Welfare (search for similar items in EconPapers)
JEL-codes: D43 L13 O34 (search for similar items in EconPapers)
Date: 2002-11-05
Note: Type of Document - pdf; prepared on pc; pages: 20 ; figures: included
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http://129.3.20.41/eps/io/papers/0211/0211003.pdf (application/pdf)

Related works:
Working Paper: Innovation, Licensing and Welfare (2002)
Journal Article: INNOVATION, LICENSING AND WELFARE (2005)
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Persistent link: http://EconPapers.repec.org/RePEc:wpa:wuwpio:0211003

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