We show that a monopolist final goods producer may find it profitable to create competition by licensing its technology if the input market is imperfectly competitive. With a centralized union, we show that licensing by a monopolist is profitable under both uniform and discriminatory wage...

Our analysis provides a rationale for the existence of a positive fixed-fee and output royalty in the licensing contracts. In this article, we show that the preference functions play an important role in this respect. As the market expansion effect gets weaker, it reduces the possibility of a...