Dj. Wright, INTERNATIONAL TECHNOLOGY-TRANSFER WITH AN INFORMATION ASYMMETRY AND ENDOGENOUS RESEARCH-AND-DEVELOPMENT, Journal of international economics, 35(1-2), 1993, pp. 47-67
In this paper, an information asymmetry concerning technology type and
the cost of operating across national boundaries interact with locati
on considerations to determine whether international technology transf
er occurs via the export of goods, subsidiaries, or licensing. It is s
hown that market share restrictions and per-unit royalties can signal
technology type and make licensing the most attractive option. In addi
tion, it is shown that policies which restrict the mode of technology
transfer do not necessarily reduce the amount of research and developm
ent undertaken.