Restrictive Licensing Practices in International Markets: A Transaction Cost Perspective.

This article presents an abstract of the dissertation "Restrictive Licensing Practices in International Markets: A Transaction Cost Perspective." The purpose of this dissertation is to explore the reasons for restrictive licensing practices in international markets. The model includes six variables extracted from our theoretical underpinning: specificity of complementary assets, behavioral uncertainty, end product market uncertainty, application uncertainty, tacitness and technological uncertainty. Two variables external to the transaction cost reasoning, licensor's market power and age of technology, are added on the basis of the past literature. Also included to control for possible moderating effects are country variables that represent locational characteristics of technology licensing in international markets. The empirical results show that licensing contracts become restrictive as it is more difficult to articulate the technology in question, to evaluate licensee's performance or to predict potential applications of the technology.