ScholarWorks@숙명여자대학교

초록

This study examines private incentives of firms to form coalitions before licensing and the welfare effects in a vertical market structure where two upstream technology owners license with two downstream marketing firms. We show that adding a firm into a coalition improves social welfare and in any coalition structure, social welfare is a decreasing function of total royalty level. We also found that given any coalition structure, welfare is higher when discriminatory licensing is allowed than when it is prohibited. Furthermore, any coalition formation that involves only one upstream firm lowers joint profit. Finally, a stable coalition structure improves welfare as compared to a structure without a coalition, but it may not be a socially optimal structure. Key

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