Licensing or Not Licensing?: Empirical Analysis on Strategic Use of Patent in Japanese Firms

In this paper, IP strategy at firm level is analyzed in a framework of use of patent as a tool for maximizing firm's revenue, based on a dataset from JPO's Survey of Intellectual Property Activities in 2004. Descriptive regressions of IP strategy indicators suggest a non-linear relationship between firm size and licensing propensity. For a small firm with less complementary assets, such as production facility and marketing channels, tends to license more. At the same time, a licensing propensity of large firm is also high due to the effect of cross licensing.