Licensing under Network Externalities”, forthcoming in Economic Record

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Title:	Licensing under Network Externalities”, forthcoming in Economic Record
Authors:	Wang, Kuang‐Cheng Andy;Liang, Wen‐Jung;Lin, Chun-Hung A.
Contributors:	淡江大學產業經濟學系
Keywords:	L21;L24
Date:	2012-12-01
Issue Date:	2013-01-18 13:03:01 (UTC+8)
Publisher:	Wiley
Abstract:	This paper develops a duopoly model to explore licensing behaviour in the presence of network externalities. Under the assumption that the licensor and the licensee compete in a duopolistic market, we obtain the following results. First, the larger the network‐externality effect, the more likely it is that the licensor will prefer fixed‐fee licensing to royalty licensing. Second, the larger the network‐externality effect, the more likely it is that the optimal royalty rate will be smaller than the reduction in marginal costs from innovation under a royalty licensing arrangement.
Relation:	The Economic Record 88(283), pp.585-593
DOI:	10.1111/j.1475-4932.2012.00832.x
Appears in Collections:	[Graduate Institute & Department of Industrial Economics] Journal Article

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