Patent strength and optimal two-part tariff licensing with a potential rival

Tatsuya Kitagawa, Yasushi Masuda and Masashi Umezawa

Economics Letters, 2014, vol. 123, issue 2, 227-231

Abstract: We investigate a two-part tariff licensing contract that enables an incumbent innovator to license the technology for a new product to a potential rival, who may alternatively develop a compatible technology for an imperfectly substitutable product. We identify the optimal two-part tariff licensing contract based on the development cost incurred by the rival, the market parameter, and the substitution coefficient.

Keywords: Licensing; Two-part tariff; Incumbent innovator; Differentiated Cournot duopoly; Patent strength (search for similar items in EconPapers)
JEL-codes: D21 D45 L19 (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:123:y:2014:i:2:p:227-231

DOI: 10.1016/j.econlet.2014.02.011

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