General technological capabilities, product market fragmentation, and markets for technology

► Firms are more likely to license general technologies (with many downstream applications) when downstream product markets are fragmented. ► When potential licensees are distant in product space from the licensor, they do not value much a dedicated technology in the product space of the licensor. ► When they are close, the licensor is not willing to license to them because of fear of competition. ► By contrast, distant licensees can find general technologies useful, and licensors are willing to license to them because they are not direct product competitors. ► We find consistent empirical evidence.