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Discriminatory vs. uniform tariffs with international technology licensing

Author

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  • Ray-Yun Chang
  • Hong Hwang
  • Cheng-Hau Peng

Abstract

This paper introduces technology licensing between rival firms into a three-country model to examine how an international technology licensing may upset the welfare ranking between a discriminatory tariff policy and a uniform tariff policy. It is found that a discriminatory tariff policy is inferior to a uniform tariff policy in terms of the social welfare of the importing country or the welfare of the world as a whole if the cost disadvantage of the licensor firm is high. This result is robust even if the licensor firm can engage in R&D investment in the long-run.

Suggested Citation

  • Ray-Yun Chang & Hong Hwang & Cheng-Hau Peng, 2016. "Discriminatory vs. uniform tariffs with international technology licensing," Asia-Pacific Journal of Accounting & Economics, Taylor & Francis Journals, vol. 23(3), pages 268-277, July.
    • Handle: RePEc:taf:raaexx:v:23:y:2016:i:3:p:268-277
    DOI: 10.1080/16081625.2016.1188451
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    Cited by:

    1. Dan Sasaki, 2016. "Infinite horizon oligopoly with asynchronous moves: Cournot-Bertrand reversal," Asia-Pacific Journal of Accounting & Economics, Taylor & Francis Journals, vol. 23(3), pages 327-341, July.

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