MERGING TO LICENSE: INTERNAL VS. EXTERNAL PATENTEE

Ramón Faulí-Oller () and Joel Sandonis
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Ramón Faulí-Oller: Universidad de Alicante

Working Papers. Serie AD from Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie)

Abstract: In this paper, we endogenize the decision of a research laboratory that owns a patented process innovation on whether to remain independent as an external patentee or to merge with a manufacturing firm, becoming an internal to the industry patentee. We show that a merger is profitable only for the case of small innovations whereas only large innovations make it welfare improving. As a consequence, the antitrust authority should forbid all (profitable) mergers.

Keywords: Patent licensing; two-part tariff contracts; external vs. internal patentee (search for similar items in EconPapers)
JEL-codes: D43 D45 L41 (search for similar items in EconPapers)
Pages: 22 pages
Date: 2003-05
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http://www.ivie.es/downloads/docs/wpasad/wpasad-2003-17.pdf Fisrt version / Primera version, 2003 (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:ivi:wpasad:2003-17

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