I am grateful to Tony Creane, Morton Kamien and an anonymous referee for helpful comments and suggestions. All remaining errors are mine.
ON THE SUPERIORITY OF FIXED FEE OVER AUCTION IN TECHNOLOGY LICENSING*
Article first published online: 8 APR 2012
© 2012 The Author. The Manchester School © 2012 Blackwell Publishing Ltd and The University of Manchester
The Manchester School
Volume 81, Issue 3, pages 324–331, June 2013
How to Cite
MIAO, C.-H. (2013), ON THE SUPERIORITY OF FIXED FEE OVER AUCTION IN TECHNOLOGY LICENSING. The Manchester School, 81: 324–331. doi: 10.1111/j.1467-9957.2011.02289.x
Manuscript received 29.12.10; final version received 3.7.11.
- Issue published online: 15 APR 2013
- Article first published online: 8 APR 2012
In this note, we identify conditions under which a fixed-fee policy is superior to an auction in technology licensing by an outsider innovator. We find that, even in cases involving a minimum degree of asymmetry among downstream firms, fixed-fee licensing can generate a strictly higher revenue than an auction, but the same can never be true in cases where issuing multiple licenses is optimal.