Intellectual property pricing under asymmetric duopoly

Patent price is the key for intellectual property (IP) trade and IP financing. By duopoly model, this article develops the theory of patent price. First, patent increases consumer surplus. Second, the firm with higher marginal costs prices patent higher than others. Finally, the firm with higher marginal costs prices patent higher under Stackelberg situation than that under Cournot cases.

Automated summary

Through the duopoly model, this article develops the theory of patent pricing, showing that the price of a patent is related to the firm's marginal costs and increases consumer surplus. In a Stackelberg situation, firms with higher marginal costs will price patents higher compared to Cournot cases.