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On the core of a patent licensing game

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Listed:
  • Nakada, Satoshi
  • Shirakawa, Ryo

Abstract

This note revisits the impossibility result shown by Watanabe and Muto (2008) that almost all outcomes cannot be in the core of a patent licensing game. To overcome this difficulty, we consider a weaker stability concept by restricting objections against payoff distributions to the ones made under an exogenously fixed payment scheme and a payment rate. In contrast to their result, we demonstrate that the coalition structures in which licensee firms are the majority can be stable in this sense. However, such a possibility result breaks down if we allow negotiations on the payment rate.

Suggested Citation

  • Nakada, Satoshi & Shirakawa, Ryo, 2023. "On the core of a patent licensing game," Economics Letters, Elsevier, vol. 233(C).
    • Handle: RePEc:eee:ecolet:v:233:y:2023:i:c:s0165176523003993
    DOI: 10.1016/j.econlet.2023.111374
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    References listed on IDEAS

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    More about this item

    Keywords

    Patent licensing games; Core allocation; Impossibility result;
    All these keywords.

    JEL classification:

    • C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games
    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection
    • D45 - Microeconomics - - Market Structure, Pricing, and Design - - - Rationing; Licensing

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