دانلود رایگان مقاله تعرفه ها صدور مجوز تکنولوژی و تصویب

Abstract

This paper develops a two-country Cournot duopoly model to investigate the implications of international technology licensing. It is shown that if the tariff imposed by the domestic country is high, it is optimal for the foreign firm to adopt an inferior technology for its production when it licenses its most advanced technology to the domestic firm. Such a licensing arrangement may improve welfare of the two countries.

4. Conclusions

Over the past two decades, technology licensing has received considerable attention and has been studied extensively. However, the literature on technology licensing did not discuss how the technology adoption of the licensor firm is being affected. The key innovation of the paper is that there are cases in which the foreign licensor firm adopts an inferior technology for its own production when it is determined to license its most advanced technology to its competitor. This inferior technology adopted by the foreign firm increases consumer surplus and welfare of the licensee firm's country. Whether the foreign licensor firm will adopt an inferior technology or not depends on the tariff rate of the domestic country. When the tariff is high, the foreign licensor firm adopts the most inferior technology for its own production but licenses the most superior technology to its rival. This arrangement turns out to be Pareto-improving as it increases not only the social welfare of the foreign country but also that of the domestic country. Another interesting finding is that trade liberalization may hurt consumer surplus. This occurs because a lower tariff makes the foreign licensor firm more competitive in the output market, giving it an incentive to raise the royalty rate to alleviate competition from the rival licensee firm. This high royalty reduces the market output, making consumer worse off. Our model can be extended in several ways. First, we have assumed that the foreign licensor firm has all the bargaining power and can extract the entire licensing rent from the licensee firm. However, this may not be the case in reality. If we consider the other extreme case where the foreign firm has no bargaining power at all (i.e., the technology can fully and freely spillover), thus receiving no licensing rent, the foreign firm does not adopt the most inferior technology since the inferior technology reduces its profit from the output market. Hence, our result holds if the foreign firm has significant bargaining power.