International technology transfer : the case of licensing in Nigeria
This study is concerned with the issue of international technology transfer, particularly to developing countries through licensing. Given the imperfect nature of technology market, multinational enterprises (MNEs) wield considerable amount of bargaining power in the negotiation of technology transfer arrangements with both related and unrelated parties. However, the intervention of host governements [sic] in the negotiation processes increases the complexity of the bargaining power issue. This aspect of transfer negotiation which is largely ignored in the literature, stems from "perceived need" to increase the benefits flowing from the operations of MHEs in the host country. Therefore the relationship between foreign investors and host countries is one of bilateral monopoly : the foreign investor has control over capital, technology, management and marketing skills needed to launch a product successfully; the host country has control over access before investment is made and over conditions for operating afterwards. Evidence from the literature show that bargaining power is a dynamic concept which incorporates a wide variety of variables. With developing countries, these variables are further complicated by the knowledge that neither the goals nor the relative bargaining strengths of the MNEs and host governments are static. They change over time. Therefore this study assesses the bargaining power determinants in a "controlled market" in which conditions are determined by the political and economic aspirations of the host government rather than by market forces of demand and supply. It also reviews the policy implications of the findings on the licensor; the licensee; and the host government. The results of this research revealed that in Nigeria, two principal factors were decisive in the determination of bargaining powers of both the multinational enterprises and the country, and these were (i) technology and its perceived importance by the host country, and (ii) the host government control policies.