We show that even if information transmission through an honest outside agency is not possible due to the possibility of collusion between the firms and the outside agency, information transmission is still possible through technology licensing. However, unlike the case of a cost-free honest...

In a world with private information about the quality of technology we find that there are situations where relatively more technologically superior firm will license its technology but relatively less technologically superior firm will not license its technology. This finding is opposite to the...

In a world with private information about the quality of technology we find that there are situations where relatively more technologically superior firm will license its technology but relatively less technologically superior firm will not license its technology. This finding is opposite to the...

This paper examines the production strategies of an international firm. We show that foreign direct investment acts as a signal to overcome an asymmetric information problem in the host-country. We find that a host-country will prefer a situation where a technologically superior (inferior) firm...