International technology licensing: Monopoly rents, transaction costs and exclusive rights

Journal of International Business Studies

Volumn 41, Issue 4, 2010, Pages 587-605

  Aulakh, Preet S ^a   Jiang, Marshall S ^b   Pan, Yigang ^a  

^a YORK UNIVERSITY   (Canada)

^b BROCK UNIVERSITY   (Canada)

Author keywords

Foreign market entry; Intellectual property; Licensing rights; Management of technology; Monopoly rents; Transaction cost economics

Indexed keywords

EID: 77951791689     PISSN: 00472506     EISSN: 14786990     Source Type: Journal    
DOI: 10.1057/jibs.2009.19     Document Type: Article

References (78)

1. Anand, B. N., & Khanna, T. 2000. The structure of licensing contracts. Journal of Industrial Economics, 48(1): 103-135.
2. Anderson, E., & Gatignon, H. 1986. Modes of foreign entry: A transaction cost analysis and propositions. Journal of International Business Studies, 17(3): 1-26.
3. Arora, A., & Ceccagnoli, M. 2006. Patent protection, complementary assets, and firms' incentives for technology licensing. Management Science, 52(2): 293-308.
4. Arora, A., & Fosfuri, A. 2000. Wholly owned subsidiary versus technology licensing in the worldwide chemical industry. Journal of International Business Studies, 31(4): 555-572.
5. Arora, A., & Fosfuri, A. 2003. Licensing the market for technology. Journal of Economic Behavior & Organization, 52(2): 277-295.
6. Arora, A., Fosfuri, A., & Gambardella, A. 2002. Market for technology: The economics of innovation and corporate strategy. Cambridge, MA: The MIT Press.
7. Arrow, K. 1969. Classificatory notes on the production and transmission of technical knowledge. American Economic Review, 59(2): 29-49.
8. Aulakh, P. S., Cavusgil, S. T., & Sarkar, M. B. 1998. Compensation in international licensing agreements. Journal of International Business Studies, 29(2): 409-419.
9. Barney, J. B. 1991. Firm resources and sustained competitive advantage. Journal of Management, 17(1): 99-120.
10. Beckman, C. M., Haunschild, P. R., & Phillips, D. J. 2004. Friends or strangers? Firm-specific uncertainty, market uncertainty, and network partner selection. Organization Science, 15(3): 259-275.
11. Bergen, M., Dutta, S., & Walker, O. C. J. 1992. Agency relationships in marketing: A review of the implications and applications of agency and related theories. Journal of Marketing, 56(3): 1-24.
12. Bessy, C., & Brousseau, E. 1998. Technology licensing contracts: Features and diversity. International Review of Law and Economics, 18(4): 451-489.
13. Bidault, F. 2004. Global licensing strategies and technology pricing. International Journal of Technology Management, 27(2-3): 295-305.
14. Brewer, J., & Hunter, A. 1989. Multi method research: A synthesis of styles. Newbury Park, CA: Sage.
15. Buckley, P. J., & Casson, M. C. 1976. The future of the multinational enterprise. London: Macmillan.
16. Cassiman, B., & Veugelers, R. 2006. In search of complementarity in innovation strategy: Internal R&D and external knowledge acquisition. Management Science, 52(1): 68-82.
17. Contractor, F. J. 1984. Choosing between direct investment and licensing: Theoretical considerations and empirical tests. Journal of International Business Studies, 15(3): 167-188.
18. Contractor, F. J. 2001. Intangible assets and principles for their valuation. In F. J. Contractor (Ed.), Valuation of intangible assets in Global operations: 3-24. Westport, CT: Quorum Books.
19. Dewar, R. D., & Dutton, J. E. 1986. The adoption of radical and incremental innovations: An empirical analysis. Management Science, 32(11): 1422-1433.
20. Economist. 2005. A market for ideas. The Economist, 22 October, 48-51.
21. Erutku, C., Freire, A. P., & Richelle, Y. 2007. Licensing innovations with exclusive contracts. Review of Industrial Organization, 31(4): 261-273.
22. Eswaran, M. 1994. Licensees as entry barriers. Canadian Journal of Economics, 27(3): 673-688.
23. Ettlie, J. E., Bridges, W. P., & O'Keefe, R. D. 1984. Organization strategy and structural differences for radical versus incremental innovation. Management Science, 30(6): 682-695.
24. Evans, A. W. 1991. On monopoly rent. Land Economics, 67(1): 1-14.
25. Fein, A. J., & Anderson, E. 1997. Patterns of credible commitments: Territory and brand selectivity in industrial distribution channels. Journal of Marketing, 61(2): 19-34.
26. Fosfuri, A. 2006. The licensing dilemma: Understanding the determinants of the rate of technology licensing. Strategic Management Journal, 27(12): 1141-1158.
27. Gallini, N. T. 1984. Deterrence by market sharing: A strategic incentive for licensing. American Economic Review, 74(5): 931-941.
28. Gallini, N. T., & Winter, R. A. 1985. Licensing in the theory of innovation. Rand Journal of Economics, 16(2): 237-252.
29. Gallini, N. T., & Wright, B. D. 1990. Technology transfer under asymmetric information. Rand Journal of Economics, 21(1): 147-160.
30. Ginarte, J. C., & Park, W. G. 1997. Determinants of patent rights: A cross-national study. Research Policy, 26(3): 283-301.
31. Hagedoorn, J. 1993. Understanding the rationale of strategic technology partnering: Interorganizational modes of cooperation and sectoral differences. Strategic Management Journal, 14(5): 371-385.
32. Hagedoorn, J. 2002. Inter-firm R&D partnerships: An overview of major trends and patterns since 1960. Research Policy, 31(4): 477-492.
33. Hagedoorn, J., Cloodt, D., & van Kranenburg, H. 2005. Intellectual property rights and governance of international R&D partnerships. Journal of International Business Studies, 36(1): 175-186.
34. Hill, C. W. L. 1992. Strategies for exploiting technological innovations: When and when not to license. Organization Science, 3(3): 428-441.
35. Hill, C. W. L. 1997. Establishing a standard: Competitive strategy and technological standards in winner-take-all industries. Academy of Management Executive, 11(2): 7-25.
36. Jaworski, B. J., & Kohli, A. K. 1993. Market orientation: Antecedents and consequences. Journal of Marketing, 57(3): 53-70.
37. Jiang, M. S., Aulakh, P. S., & Pan, Y. G. 2007. The nature and determinants of exclusivity rights in international technology licensing. Management International Review, 47(6): 869-893.
38. Jiang, M. S., Aulakh, P. S., & Pan, Y. G. 2009. Licensing duration in foreign markets: A real options perspective. Journal of International Business Studies, 40(4): 559-577.
39. Johanson, J., & Vahlne, J. 1977. The internationalization process of the firm - A model of knowledge development and increasing foreign market commitments. Journal of International Business Studies, 8(1): 23-32.
40. Kamien, M. I., & Tauman, Y. 1986. Fees versus royalties and the private value of a patent. Quarterly Journal of Economics, 101(3): 471-491.
41. Kamien, M. I., Tauman, Y., & Zang, I. 1988. Optimal license fees for a new product. Mathematical Social Sciences, 16(1): 77-106.
42. Katz, M., & Shapiro, C. 1986. Technology adoption in the presence of network externalities. Journal of Political Economy, 94(4): 822-841.
43. Kim, Y. J., & Vonortas, N. S. 2006. Determinants of technology licensing: The case of licensors. Managerial and Decision Economics, 27(4): 235-249.
44. Kogut, B., & Singh, H. 1988. The effect of national culture on the choice of entry mode. Journal of International Business Studies, 19(3): 411-432.
45. Kogut, B., & Zander, U. 1992. Knowledge of the firm, combinative capabilities, and the replication of technology. Organization Science, 3(3): 383-397.
46. Kotabe, M., Sahay, A., & Aulakh, P. S. 1996. Emerging role of technology licensing in the development of global product strategy: Conceptual framework and research propositions. Journal of Marketing, 60(1): 73-88.
47. Lane, P. J., & Lubatkin, M. 1998. Relative absorptive capacity and interorganizational learning. Strategic Management Journal, 19(5): 461-477.
48. Leonard-Barton, D., & Sinha, D. 1993. Developer-user interaction and user satisfaction in internal technology transfer. Academy of Management Journal, 36(5): 1125-1139.
49. Lieberman, M. B., & Montgomery, D. B. 1988. First-mover advantages. Strategic Management Journal, 9(S1): 41-58.
50. Mansfield, E. 1985. How rapidly does new industrial technology leak out? Journal of Industrial Economics, 34(2): 97-107.
51. Martin, X., & Salomon, R. 2003. Knowledge transfer capacity and its implications for the theory of the multinational corporation. Journal of International Business Studies, 34(4): 356-373.
52. Miller, K. D., & Folta, T. B. 2002. Option value and entry timing. Strategic Management Journal, 23(7): 655-665.
53. Mottner, S., & Johnson, J. P. 2000. Motivations and risks in international licensing: A review and implications for licensing to transitional and emerging economies. Journal of World Business, 35(2): 171-188.
54. Narula, R. 2001. Choosing between internal and non-internal R&D activities: Some technological and economic factors. Technology Analysis & Strategic Management, 13(3): 365-387.
55. Nelson, R. R., & Winter, S. G. 1982. An evolutionary theory of economic change. Cambridge, MA: Harvard University Press.
56. Neter, J., Wasserman, W., & Kutner, M. H. 1985. Applied linear statistical models: Regression, analysis of variance, and experimental designs. Homewood, IL: Irwin Press.
57. Ohmae, K. 1989. Global logic of strategic alliances. Harvard Business Review, 67(2): 126-137.
58. Ohmae, K. 1990. The borderless world: Power and strategy in the interlinked economy. New York: Harper Business.
59. Oxley, J. E. 1999. Institutional environment and the mechanisms of governance: The impact of intellectual property protection on the structure of inter-firm alliances. Journal of Economic Behavior and Organization, 38(3): 283-309.
60. Park, W. G. 2008. International patent protection: 1960-2005. Research Policy, 37(4): 761-766.
61. Pollzien, G. M. 1973. International licensing agreements. Indianapolis, IN: Bobbs-Merrill.
62. Porter, M. E. 1980. Competitive strategy: Techniques for analyzing industries and competitors. New York: Free Press.
63. Rindfleisch, A., & Heide, J. B. 1997. Transaction cost analysis: Past, present, and future applications. Journal of Marketing, 61(4): 30-54.
64. Rockett, K. E. 1990. Choosing the competition and patent licensing. Rand Journal of Economics, 21(1): 161-171.
65. Roy, M. H., & Dugal, S. S. 1999. The effect of technological environment and competitive strategy on licensing decisions. American Business Review, 17(2): 112-118.
66. Schmitz, P. W. 2002. On monopolistic licensing strategies under asymmetric information. Journal of Economic Theory, 106(1): 177-189.
67. Schmitz, P. W. 2007. Exclusive versus non-exclusive licensing strategies and moral hazard. Economic Letters, 97(3): 208-214.
68. Shapiro, C. 1985. Patent licensing and R&D rivalry. American Economic Review, 75(2): 25-30.
69. Shepard, A. 1987. Licensing to enhance demand for new technologies. RAND Journal of Economics, 18(3): 360-368.
70. Tan, J., & Peng, M. W. 2003. Organizational slack and firm performance during economic transitions: Two studies from an emerging economy. Strategic Management Journal, 24(13): 1249-1263.
71. Tang, M., & Yu, C. 1990. Foreign market entry: Production-related strategies. Management Science, 36(4): 476-489.
72. Teece, D. J. 1976. The multinational corporation and the resource cost of international technology transfer. Cambridge, MA: Ballinger.
73. Teece, D. J. 1977. Technology transfer by multinational firms: The resource cost of transferring technological know-how. The Economic Journal, 87(346): 242-261.
74. Teece, D. J. 1986. Profiting from technological innovation: Implications for integration, collaboration, licensing and public policy. Research Policy, 15(6): 285-305.
75. Teece, D. J. 1988. Capturing value from technological innovation: Integration, strategic partnering and licensing decisions. Interfaces, 18(3): 46-61.
76. Telesio, P. 1979. Technology licensing and multinational enterprises. New York: Praeger.
77. Williamson, O. E. 1975. Markets and hierarchies. New York: Free Press.
78. Williamson, O. E. 1983. Credible commitments: Using hostages to support exchange. The American Economic Review, 73(4): 519-540.