We examine commonly observed forms of payment, such as milestones, royalties, or consulting contracts as ways of …, royalties are not optimal unless the licensing firm is risk averse. The model also predicts the use of consulting contracts … which improve the firm's ability to monitor inventor effort. Because these contracts increase the firm's expected profits …

drivers in the U.S. Specifically, we argue that contracts in this industry serve to economize on the costs of price … determination for heterogeneous transactions. We show that the actual terms of those contracts vary systematically with the nature …

an asset that has greater value if owned by the principal than by the agent. When contracts can be renegotiated, a well … renegotiation. We show that option contracts will achieve the first best whenever this threat-point effect dominates the holdup …