Cross-Licensing and Competition

Doh-Shin Jeon and Yassine Lefouili

No 10941, CEPR Discussion Papers from C.E.P.R. Discussion Papers

Abstract: We study bilateral cross-licensing agreements among N (>2) competing firms. We find that the industry-profit-maximizing royalty can be sustained as the outcome of bilaterally efficient agreements. This holds regardless of whether agreements are public or private and whether firms compete in quantities or prices. We extend this monopolization result to a general class of two-stage games in which firms bilaterally agree in the first stage to make each other payments that depend on their second-stage non-cooperative actions. Policy implications regarding the antitrust treatment of cross-licensing agreements are derived.

Keywords: Antitrust and intellectual property; Collusion; Cross-licensing; Royalties (search for similar items in EconPapers)
JEL-codes: D14 F13 L24 L41 O34 (search for similar items in EconPapers)
Date: 2015-11
New Economics Papers: this item is included in nep-com, nep-ind, nep-ipr, nep-pr~ and nep-law
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Related works:
Journal Article: Cross‐licensing and competition (2018)
Working Paper: Cross-Licensing and competition (2018)
Working Paper: Cross-Licensing and Competition (2017)
Working Paper: Cross-Licensing and Competition (2015)
Working Paper: Cross-Licensing and Competition (2013)
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