How the alliance pie is split: Value appropriation by each partner in cross-border technology transfer alliances

Farok J. Contractor and James A. Woodley

Journal of World Business, 2015, vol. 50, issue 3, 535-547

Abstract: Almost no academic papers treat a crucial aspect of alliances – the determinants of the division of alliance value over the partners. Analyzing a sample of cross-border alliances, technology providing partners increase their share of total alliance returns when accepting riskier forms of compensation. Returns to a partner, and the risk they assume, are shown to be correlated through minimum sales or minimum royalty agreement clauses. Firms with stronger technical capabilities gain more from technology alliances. The bargaining power wielded by each party, while negotiating the structure of an alliance, influences each partner's share of overall alliance benefits.

Keywords: Alliances and joint ventures; Value appropriation from alliances; Risk-return tradeoffs; Inter-firm technology transfer (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (10)

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DOI: 10.1016/j.jwb.2014.08.011

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