Technology licensing with strategic tax policy

Arijit Mukherjee and Yingyi Tsai

Discussion Papers from University of Nottingham, School of Economics

Abstract: Despite the important insights it has provided, technology licensing literature remains restrictive by not allowing government policies. We show that in the presence of strategic tax policies, an outside innovator and, more interestingly and in contrast to the existing works, the consumers are better off under royalty licensing compared to auction (or fixed-fee licensing) if the number of potential licensees is sufficiently large. It follows from our analysis that a combination of fixed-fee and output royalty can be preferable to the innovator compared to both royalty licensing and auction (or fixed-fee licensing).

Keywords: Licensing; Tax; Auction; Royalty (search for similar items in EconPapers)
Date: 2010-09
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:not:notecp:10/09

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