This paper shows that technology licensing may be socially undesirable. Possibility of licensing increases the incentive for entry and thus, increases competition. If technology of the incumbent and entrant is sufficiently close, licensing-induced entry reduces social welfare. Otherwise,...

The literature on technology licensing has ignored the importance ofmarket power of the input supplier. In this paper we examine the incentive forlicensing in the downstream industry when the firms in the upstream industry havemarket power. We show that licensing in the downstream industry is...

Noncooperative games in which each player’s payo¤ function depends on anadditively separable function of every player’s choice variable may be transformedinto an aggregative game, which may be analysed using the conceptof ‘share functions’. The resulting approach avoids the...