Which Firms Buy Licenses? Market Positions and License Expenditures

18 Pages Posted: 4 Aug 2010

See all articles by Dirk Czarnitzki

Dirk Czarnitzki

Catholic University of Leuven (KUL); Centre for European Economic Research (ZEW)

Kornelius Kraft

University of Dortmund - Department of Economics; IZA Institute of Labor Economics

Abstract

This paper presents the empirical results of a comparison of technology licensing expenditures of German companies in order to test implications of the Gilbert and Newbery (1982) model. Aside from standard control variables, the motives for innovation expenditures are also taken into account. We differentiate between firms intending to secure their present position in the market (incumbents) and those intending to enter a new market (challengers). In line with the prediction of the Gilbert and Newbery model, we find that incumbents show higher expenditures for technology licenses than potential entrants.

Suggested Citation

Czarnitzki, Dirk and Czarnitzki, Dirk and Kraft, Kornelius, Which Firms Buy Licenses? Market Positions and License Expenditures. Scandinavian Journal of Economics, Vol. 112, No. 3, pp. 471-488, September 2010, Available at SSRN: https://ssrn.com/abstract=1653056 or http://dx.doi.org/10.1111/j.1467-9442.2010.01610.x

Dirk Czarnitzki (Contact Author)

Catholic University of Leuven (KUL) ( email )

Faculty of Economics and Business
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Leuven, 3000
Belgium
+32 16 326906 (Phone)
+32 16 325799 (Fax)

HOME PAGE: http://www.econ.kuleuven.be/msi/faculty_members.htm

Centre for European Economic Research (ZEW) ( email )

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Mannheim, 68034
Germany

Kornelius Kraft

University of Dortmund - Department of Economics ( email )

D-44221 Dortmund
Germany
+49 231 755-3152 (Phone)
+49 231 755-3155 (Fax)

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

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