EconPapers    
Economics at your fingertips  
 

Patent licensing in a Cournot oligopoly: General results

Debapriya Sen and Yair Tauman ()

Mathematical Social Sciences, 2018, vol. 96, issue C, 37-48

Abstract: This paper presents a comprehensive analysis of patent licensing in a Cournot oligopoly with general demand and looks at both cases: outside and incumbent innovators. The licensing policies considered are upfront fees, unit royalties and combinations of fees and royalties (FR policies). It is shown that (i) royalties unambiguously ensure full diffusion of the innovation while diffusion is limited under upfront fees, (ii) the Cournot price is higher under royalties compared to upfront fees and the price could even exceed the post-innovation monopoly price, (iii) for generic values of magnitudes of the innovation, when the industry size is relatively large, royalties are superior to upfront fees for the innovator and (iv) for any m, there is always a non empty subset of m-drastic innovations such that for relatively large industry sizes, upfront fee policy results in higher consumer surplus as well as welfare compared to both royalty and FR policies.

Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0165489618300556
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Patent licensing in a Cournot oligopoly: general results (2018) Downloads
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:eee:matsoc:v:96:y:2018:i:c:p:37-48

Access Statistics for this article

Mathematical Social Sciences is currently edited by J.-F. Laslier

More articles in Mathematical Social Sciences from Elsevier
Bibliographic data for series maintained by Dana Niculescu ().

 
Page updated 2019-04-07
Handle: RePEc:eee:matsoc:v:96:y:2018:i:c:p:37-48