Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/159672
Authors: 
Filippini, Luigi
Vergari, Cecilia
Year of Publication: 
2012
Series/Report no.: 
Quaderni - Working Paper DSE 833
Abstract: 
We study the licensing incentives of an independent input producer owning a patented product innovation which allows the downstream firms to improve the quality of their final goods. We consider a general two-part tariff contract for both outside and incumbent innovators. We find that technology diffusion critically depends on the nature of market competition (Cournot vs. Bertrand). Moreover, the vertical merger with either downstream firm is always privately profitable and it is welfare improving for large innovations: this implies that not all profitable mergers should be rejected.
JEL: 
L15
L13
L24
Persistent Identifier of the first edition: 
Creative Commons License: 
https://creativecommons.org/licenses/by-nc/3.0/
Document Type: 
Working Paper

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