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How Much are Flexibility and Uncertainty Worth in Patent Licensing?

Publikation: Bidrag til tidsskriftTidsskriftartikel

DOI

As patent licensing has become the prime driver of technology trade, understanding the rationales behind a properly-defined payment structure of the agreements is essential. Specifically, among the other remuneration components, upfront fees are critical in license negotiations since they imply a significant initial investment by the licensee and represent a source of liquidity for the licensor. We investigate how contractual flexibility, market uncertainty and technical uncertainty shape upfront fees from the licensee’s perspective. Upfront fees are shown to be positively associated with contractual flexibility and market uncertainty, while technical uncertainty is positively associated with upfront fees only if the license warrants contractual flexibility to the licensee. Licensees therefore do not necessarily see uncertainty as a negative attribute of a patent license, but rather as a potential value, above all if in presence of contractual flexibility.

Publikationsoplysninger

OriginalsprogEngelsk
TidsskriftEconomia e Politica Industriale
Vol/bind42
Tidsskriftsnummer4
Sider (fra-til)371-394
ISSN0391-2078
DOI
StatusUdgivet - 2015

    Forskningsområder

  • Technology licensing, Upfront payments, Flexibility, Uncertainty

ID: 44289074