Redefining Intra-brand Licensing: Can Vertical Differentiation Transform Patent Strategies?

Saswati Chakraborty () and Oindrila Dey ()
Additional contact information
Saswati Chakraborty: Indian Institute of Foreign Trade, Kolkata Campus
Oindrila Dey: Indian Institute of Foreign Trade, Kolkata Campus

Journal of Quantitative Economics, 2025, vol. 23, issue 3, No 7, 847-874

Abstract: Abstract This paper explores the potential for technology licensing between intra-brand competitors amid inter-brand competition. By integrating the role of vertical differentiation in the framework, we get some contrasting results from the existing literature. We find that when innovation is non-drastic the optimal license contract for a given size of innovation is (i) a royalty alone or a two-part tariff depending on the interval of quality (net of cost) of the superior brand, when the inter-brands are distant to moderate substitutes (ii) a two-part tariff, when inter-brands are moderate to close substitutes. Regardless of the degree of substitution, we find only fixed-fee licensing contract is optimal when the size of innovation is relatively small. Additionally, we also identify the existence of an optimal tariff that can induce technology licensing.

Keywords: Intra-brand competition; Inter-brand competition; Moderate substitutes; Optimal tariff; Vertical differentiation (search for similar items in EconPapers)
JEL-codes: D L (search for similar items in EconPapers)
Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
http://link.springer.com/10.1007/s40953-025-00450-0 Abstract (text/html)
Access to the full text of the articles in this series is restricted.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spr:jqecon:v:23:y:2025:i:3:d:10.1007_s40953-025-00450-0

Ordering information: This journal article can be ordered from
http://www.springer.com/economics/journal/40953

DOI: 10.1007/s40953-025-00450-0

Access Statistics for this article

Journal of Quantitative Economics is currently edited by Dilip Nachane and P.G. Babu

More articles in Journal of Quantitative Economics from Springer, The Indian Econometric Society (TIES) Contact information at EDIRC.
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().