Investigating Investment Decisions in Independent Innovation by Licensees under Ex Ante Licensing Arrangements

Abstract

This research delves into the decision-making process of licensees regarding investments in independent innovation within the framework of ex ante licensing agreements. Ex ante licensing, characterized by the pre-licensing of intellectual property rights for future innovations, poses unique challenges and opportunities for licensees in terms of their investment strategies for independent innovation. Drawing upon theories of licensing, innovation management, and decision sciences, this study examines the factors influencing licensees' decisions to invest in independent innovation projects while holding licensed intellectual property rights. The research explores the role of factors such as technology uncertainty, market demand, competition dynamics, organizational capabilities, and contractual obligations in shaping investment decisions by licensees. Through a mixed-methods approach encompassing quantitative surveys, case studies, and interviews with industry experts, the study aims to provide insights into the drivers, barriers, and outcomes of investment decisions in independent innovation under ex ante licensing arrangements. The findings offer practical implications for licensees, licensors, and policymakers seeking to optimize the effectiveness and efficiency of technology transfer and innovation management practices. By shedding light on the decision-making process of licensees in the context of ex ante licensing, this research contributes to advancing our understanding of the dynamics of technology commercialization and innovation strategy in knowledge-based economies.