Location choice and patent licensing

Yan Shu Lin*, Jin-Li Hu, Peng Chiao Xia

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

1 Scopus citations


This paper studies the patent licensing decision when firms can endogenously choose their locations. If the insider patentee is the location leader, the royalty is not necessarily the best method of licensing. No licensing can be the best method for an insider patentee with a sufficiently high degree of innovation, but fixed-fee is always the worst. However, if the non-innovating firm is the location leader, the royalty licensing is always the best method; moreover, the fixed-fee licensing (no licensing) is the second best method if the degree of innovation is relatively small (sufficiently large).

Original languageEnglish
Pages (from-to)121-142
Number of pages22
JournalManchester School
Issue number2
StatePublished - 1 Mar 2013

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