Discussion of “Divisional performance measurement and transfer pricing for intangible assets”

Review of Accounting Studies · 2006 · Volume 11 · Issue 2

Abstract

The conference paper by Johnson (2006,Review of Accounting Studies, forthcoming) develops an incomplete-contracting transfer pricing model with a number of novel features: taxation, sequential investments, and intangible assets being transferred. This discussion aims to disentangle these features so as to highlight those that are the key drivers of the results. Moreover, I show that some of the results can be generalized to settings involving a greater level of technological interdependency between the divisions.

Keywords

Transfer pricing, Intangibles, Taxation, Hold-up problem

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