Optimal Pricing Strategy of Environmental Patent Transaction Under Asymmetric Information

With the customers' increasing awareness of environment protection, the manufacturers are motivated to purchase green patent from the patent owner to develop green products to response this trend. However, it remains some challenging issues to be further studied, e.g., how to purchase the patent in case that the manufacturer does not know its actual function (it may be a higher or a relative lower environmental patent)? What is the optimal configuration of the payments (i.e., the combination of the fixed fee and the unit fee)? The paper focuses on this issue and proposes two contracts to explore the patent transaction: the pooling contract and the screening contract. The analyses show two interesting findings: firstly, compared with the pooling contract, the screening contract can catch the true status of the patent. Secondly, compared with the performance of the pooling contract, the manufacturer can enjoy more profits by implementing the screening contract.