Technology Transfer: Barriers and Opportunities

In this paper we study technology transfer in a duopoly model with heterogeneous goods under quantity and price competition. We obtain three conclusions: Firstly, under product heterogeneity, technology transfer can take any form. Secondly, the properties found in the homogeneous case generalize to the heterogeneous case with various degrees of generality. Finally, if demand is not symmetric we may find full technology transfer between firms with different sizes and that firms with similar technology do not engage in technology transfer. We find evidence of the latter in the market for antidepressants.