Technology Market Transactions
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Technology Market Transactions

Auctions, Intermediaries and Innovation

Frank Tietze

Frank Tietze delivers an in-depth discussion of the impact of empirical results upon transaction cost theory, and in so doing, provides the means for better understanding technology transaction processes in general, and auctions in particular. Substantiating transaction cost theory with empirical auction data, the author goes on to explore how governance structures need to be designed for effective distributed innovation processes. He concludes that the auction mechanism is a viable transaction model, and illustrates that the auction design, as currently operated by market intermediaries, requires thorough adjustments. Various options for possible improvements are subsequently prescribed.
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Chapter 11: Discussion of Results

Frank Tietze

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11. Discussion of Results This chapter discusses selected aspects of this study’s results, particularly in relation to transaction cost (TC) theory. The research conducted during the course of the present study has centered on determining under which circumstances and particularly depending on which technology properties, auctions represent a preferred governance structure for transactions on the markets for technologies and ideas (MfTI). This question was broken down into two specific research questions. The first research question paved the way for the second one. Hence, the following discussion primarily addresses aspects related to the second research question, but also broadens the discussion beyond that question to account for aspects within the overarching theme of open innovation. Which technologies should be auctioned? To a large extent, the results of the regression analyses confirmed the hypotheses derived in Section 9.3, which were based on the qualitative prestudies and are in line with the predictions from TC theory. Hence, technologies have a higher probability to be auctioned, if they have a lower technological complexity, but a higher technological impact and higher technology quality. Technologies with a higher technological impact and technology quality also reach higher sales prices at the auctions. Furthermore, the sellers’ value perception is also positively associated with the sales price.1 However, the results of three technological properties are not so obvious and need further discussion. First, in contrast to the arguments provided in Section 9.3, technological complexity has a negative relationship with the sales price. A possible explanation for this effect is...

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