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The Structure of Payments in Technology Transfer Contracts: Evidence from Spain
Author(s) -
Mendi Pedro
Publication year - 2005
Publication title -
journal of economics and management strategy
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.672
H-Index - 68
eISSN - 1530-9134
pISSN - 1058-6407
DOI - 10.1111/j.1530-9134.2005.00046.x
Subject(s) - payment , duration (music) , sample (material) , variable (mathematics) , actuarial science , economics , risk aversion (psychology) , business , transfer payment , empirical evidence , econometrics , financial economics , finance , expected utility hypothesis , mathematics , market economy , art , mathematical analysis , chemistry , philosophy , literature , chromatography , epistemology , welfare
This paper studies the impact of contract duration in determining scheduled payments in international transfers of technology. Analyzing a sample of contracts written by Spanish firms in 1991, the main empirical finding is a positive relationship between contract duration and the probability of the parties including variable payments in the first period of the agreement. This result suggests that the parties choose the type of payments to be made, whether fixed or variable, so as to avoid early termination of the relationship, even in the absence of opportunistic behavior or risk aversion.