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Innovation spillover, licensing, and ex-post privatization in international duopoly

Yi Liu, Yu Tan and Yu Fang

MPRA Paper from University Library of Munich, Germany

Abstract: This paper studies the impact of innovation spillover and licensing on optimal ex-post privatization policies by involving an exogenous R&D activity in a partial-equilibrium international duopoly setting. By assuming a domestic public firm is relatively inefficient compared to its foreign private rival, we characterize and discuss optimal privatization policies under both foreign private and domestic public innovation. The theoretical results suggest that foreign private (domestic public) innovation, including both spillover and licensing, reduces (increases) the optimal degree of ex-post privatization. In addition, innovation spillover and licensing have the same impact direction on privatization policies. The numerical evidence supports these theoretical findings.

Keywords: Spillover; Licensing; Ex-post Privatization; International Duopoly (search for similar items in EconPapers)
JEL-codes: F13 H4 L13 L24 L33 (search for similar items in EconPapers)
Date: 2019-08-09
New Economics Papers: this item is included in nep-com, nep-ind, nep-ino, nep-int and nep-sbm
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