ScholarWorks@숙명여자대학교

초록

This paper considers coalition incentives among core technology holders and investigates stability and welfare effects of such coalitions where a monopolistic downstream firm needs to license from n upstream firms. Main results are as follows. First, when the coalition competes with outside firms on an equal basis, social welfare increases as the size of the coalition becomes larger. In this case, if the number of upstream firms exceeds 3, coalitions of any size is unstable. Second, when the coalition plays as a Stackelberg leader in licensing game, the coalition can be stable as long as its size is within a certain interval. Third, if the coalition formation encourages entry in downstream market, the coalition can be stable. Fourth, if the deviating firm's technology can be replaced with possibly inferior technology, the whole coalition can be stable. Fifth, if the government regulates the royalty level, the whole coalition can be stable.

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