Working papers:
A Dynamic Analysis of Licensing: The "Boomerang" Effect and Grant-Back Clauses
Jay Pil Choi
Downloads:
- Title:
- A Dynamic Analysis of Licensing: The "Boomerang" Effect and Grant-Back Clauses
- Author(s):
- Choi, Jay Pil
- Date:
- 1997
- Type:
- Working papers
- Department:
- Economics
- Permanent URL:
- http://hdl.handle.net/10022/AC:P:15704
- Series:
- Department of Economics Discussion Papers
- Part Number:
- 9697-16
- Publisher:
- Department of Economics, Columbia University
- Publisher Location:
- New York
- Abstract:
- This paper develops an incomplete contract model of the licensing relationship to analyze the dynamic effects of licensing on R&D competition in the innovation market and to examine the rationale for often observed grant-back clauses. Of particular concern are how the consideration of future competition distorts the licensing relationship and how the “grant-back” clause can mitigate this distortion. I also evaluate the validity of the casual antitrust argument that grantback clauses may adversely affect competition because they reduce the licensee’s incentive to engage in R&D and thereby limit rivalry in innovation markets.
- Subject(s):
- Economics
- Item views:
- 304