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Choice of foreign licensees: information and communication technology firms

YoungJun Kim (Graduate School of Management of Technology, Korea University, Seoul, South Korea)

Industrial Management & Data Systems

ISSN: 0263-5577

Article publication date: 23 September 2013

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Abstract

Purpose

This paper aims to study the validity of potential factors that might affect US information and communication technology (ICT) holders' choice of foreign licensing partners.

Design/methodology/approach

This study focuses on ICT industry. The sample firms for this study are drawn from the SDC by Thomson Financial and this sample was used to construct a data in which a unit of observation is the unique US licensor – foreign licensee pair, or a dyad. The hypotheses are tested using the random-effects logit model.

Findings

The important explanatory factors relate to the knowledge appropriability and the level of economics freedom of a licensee's country, and familiarity between partners through prior licensing agreements. Market similarity between partners, however, appears to be an insignificant factor.

Practical implications

The findings suggest that transaction cost, competition, and national absorb capacity considerations weigh in heavily in explaining firms' choice of foreign licensing partners.

Originality/value

The paper makes an important contribution to licensing literature as the understanding of what drives partner choice is still sparse. Especially, the paper makes a uniqueness of dealing with international technology licensing.

Keywords

Acknowledgements

The author thanks Professor Nicholas S. Vonortas and the Center for International Science and Technology Policy at The George Washington University, USA, for their research support. All the remaining mistakes are the responsibility of the author.

Citation

Kim, Y. (2013), "Choice of foreign licensees: information and communication technology firms", Industrial Management & Data Systems, Vol. 113 No. 9, pp. 1300-1314. https://doi.org/10.1108/IMDS-03-2013-0159

Publisher

:

Emerald Group Publishing Limited

Copyright © 2013, Emerald Group Publishing Limited

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