We show that a two-part tariff licensing contract is always optimal to the insider patentee in spatial models irrespective of the size of the innovation or any pre-innovation cost asymmetries. The result provides a simple justification of the prevalence of two-part tariff licensing contracts in...

The purpose of this paper is to analyse the question, whether copyright infringement of digital products like software commonly labelled as piracy impedes innovation. We find the answer depends on the nature of piracy i.e. whether it is end-users or commercial piracy. For end user piracy,...