The Journal of Technology Transfer

, Volume 38, Issue 3, pp 251–272 | Cite as

Licensing versus selling in transactions for exploiting patented technological knowledge assets in the markets for technology



This paper examines the determinants of the types of technology transactions in the markets for technology. On the basis of the relationship between the characteristics of a firm’s patents and the firm’s decision on whether to license out or sell these patented technologies, we empirically analyze the determinants of the decision. We employ interlocked patent data from the representative Korean market for technology, the National Technology Bank, using a bivariate probit regression model in a theoretical framework that includes the option and transaction cost perspectives. Overall, the results show that the relationship between licensing and selling, the major alternatives in technology transactions, is strongly substitutive. The major finding of this study is that firms in markets for technology tend to prefer licensing their patents when uncertainty is low or transaction cost is high, whereas they tend to prefer selling their patents under opposite conditions.


Technology transfer Market for technology Technology exploitation strategy Technology licensing 

JEL Classification

C35 D22 D81 


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Copyright information

© Springer Science+Business Media, LLC 2012

Authors and Affiliations

  1. 1.Department of R&D PolicyKorea Institute of Machinery & MaterialsYuseong-Gu, DaejeonRepublic of Korea
  2. 2.IP Policy TeamKorea Institute of Intellectual PropertyGangnam-Gu, SeoulRepublic of Korea
  3. 3.Technology Management, Economics and Policy Program (TEMEP), College of EngineeringSeoul National UniversityKwanak-Gu, SeoulRepublic of Korea

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