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The Pace of Technology Transfer in Anticipation of Joint Venture Breakup AgEcon
Van Long, Ngo; Soubeyran, Antoine; Soubeyran, Raphael.
This paper studies the properties of joint-venture relationship between a technologically advanced multinational firm and a local firm operating in a developing economy where the ability to enforce contracts is weak. We formulate a dynamic model of principal-agent relationship in which at any point of time the local firm can quit without legal penalties. An early breakup may be prevented if the multinational designs a suitable scheme in which both the pace and aggregate amount of technology transfer deviate from the first-best, and a suitable flow of side payments to encourage the local firm to stay longer.
Tipo: Working or Discussion Paper Palavras-chave: Technology Transfer; Joint Venture; Developing Economies; Research and Development/Tech Change/Emerging Technologies; O3.
Ano: 2009 URL: http://purl.umn.edu/55329
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