Exclusive versus Non-Exclusive Licensing Strategies and Moral Hazard

15 Pages Posted: 22 May 2008

See all articles by Patrick W. Schmitz

Patrick W. Schmitz

University of Cologne; Centre for Economic Policy Research (CEPR)

Multiple version iconThere are 2 versions of this paper

Date Written: March 2007

Abstract

An upstream firm can license its innovation to downstream firms that have to exert further development effort. There are situations in which more licenses are sold if effort is a hidden action. Moral hazard may thus increase the probability that the product will be developed.

Keywords: Innovation, Licences, Monopoly, Private information

JEL Classification: D45, D82, L12

Suggested Citation

Schmitz, Patrick W., Exclusive versus Non-Exclusive Licensing Strategies and Moral Hazard (March 2007). CEPR Discussion Paper No. DP6207, Available at SSRN: https://ssrn.com/abstract=1135449

Patrick W. Schmitz (Contact Author)

University of Cologne ( email )

Albertus-Magnus-Platz
Cologne, 50923
Germany

HOME PAGE: http://schmitz.uni-koeln.de/index.php?s=mitarbeiter&t=schmitz

Centre for Economic Policy Research (CEPR)

London
United Kingdom

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