Determinants of patent rights: A cross-national study

Inspired by the Chinese experience, we develop a Schumpeterian growth model of distance to frontier in which economic growth in the developing country is driven by domestic innovation as well as imitation and transfer of foreign technologies through foreign direct investment. We show that optimal intellectual property rights (IPR) protection is stage-dependent. At an early stage of development, the country implements weak IPR protection to facilitate imitation. At a later stage of development, the country implements strong IPR protection to encourage domestic innovation. Therefore, the growth-maximizing and welfare-maximizing levels of patent strength increase as the country evolves towards the world technology frontier, and this dynamic pattern is consistent with the actual evolution of patent strength in China. We are very grateful to the anonymous Referees and Patrick Francois (the Editor) for their insightful comments that have improved the manuscript signi…cantly. We also would like to thank Elias Dinopoulos, Rachel Gri¢ th, Oleksandr Talavera, Fabrizio Zilibotti, and seminar participants at

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“…The aggregate supply of labor L t is one for all t. 26 The conditional demand function for X t (i) is…”

Section: Final Goodsmentioning

confidence: 99%

“…This simple setup, which is in line 25 See Section 6 for a discussion of this assumption. 26 Setting L t = 1 also allows us to sidestep the issue of scale e¤ects. 27 There is also a conditional demand function for labor given by w t = (1 )…”

Section: Intermediate Goods and Domestic Innovationmentioning

confidence: 99%

Stage-dependent intellectual property rights

Chu

Cozzi

Galli

2014

Journal of Development Economics

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“…Since then many countries have strengthened their intellectual property system (Maskus, 2000). Based on the seminal study by Ginarte and Park (1997), who constructed an index to measure the strength of patent protection in various countries according to the coverage of the patent law, membership in international agreements, loss of protection, and enforcement and duration of protection, scholars have investigated the impact of the strength of patent regimes on innovative activities of firms. In a panel data analysis for 64 developing countries, Chen and Puttitanun (2005) found that the strength of patent regime has a positive impact on innovations, as well as that the strength of patent regime first decreases and then increases with the level of development of the country, forming a U-shaped relationship.…”

Section: Hypothesesmentioning

confidence: 99%

Determinants of quadic patenting: Market access, imitative threat, competition and strength of intellectual property rights

Huang

Jacob

2014

Technological Forecasting and Social Change

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This paper analyses firms' decisions to seek intellectual property rights in global markets, particularly in China. We advance the notion of quadic patent family, defined as a patent family that consists of patent applications at the European Patent Office, the Japanese Patent Office, the United States Patent and Trademark Office, and the national patent office of a fourth country. We examine the determinants of quadic patenting at the industry level for China, and at the country level for a sample of 38 countries. Our results indicate that quadic patent applications are driven by the need for accessing markets, and for meeting the challenges of imitative threat and product market competition.

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“…Indeed, much academic and managerial writing has been dedicated to the value creation aspects of such alliances (Lavie 2006 provides a good review). But as firms from various national jurisdictions come in contact with one another, issues of value appropriation due to uneven intellectual property rights (IPR) protection have become one of the most (if not the most) important concerns reported by managers (Teece 1986;Ginarte and Park 1997;Zhao 2006).…”

Section: Introductionmentioning

confidence: 99%

Liberty in Law? Intellectual Property Rights and Global Alliance Networks

Balachandran

Hernandez

2016

AMPROC

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Do formal legal institutions complement or substitute social network mechanisms of knowledge protection? We explore how the composition and structure of firms' international alliance networks changes in response to the passage of intellectual property rights (IPR) laws in their home countries. We find that, when IPR laws are strengthened, firms form more international alliances, particularly if they operate in IP intensive industries, and do so with partners from a greater diversity of countries. The significance of status (centrality) as a predictor of international alliance formation decreased after the passage of IPR laws, in line with a substitution effect that 'democratized' access to the global network by increasing the participation of firms that were peripheral before the legal changes. In contrast, the closure of firms' alliance networks increased with stronger IPR laws, in line with a complementarity effect that increased the use of social control. The increase in closure was strongest in the networks of the low status entrants into the global network. Using a difference-indifference empirical design, we found that these changes coincided exactly with the timing of the passage of the laws across thirteen countries between 1988 and 2005. This study addresses issues of great theoretical and practical importance to the literatures on institutions, networks, and IPR. Abstract: Do formal legal institutions complement or substitute social network mechanisms of knowledge protection? We explore how the composition and structure of firms' international alliance networks changes in response to the passage of intellectual property rights (IPR) laws in their home countries. We find that, when IPR laws are strengthened, firms form more international alliances, particularly if they operate in IP intensive industries, and do so with partners from a greater diversity of countries. The significance of status (centrality) as a predictor of international alliance formation decreased after the passage of IPR laws, in line with a substitution effect that 'democratized' access to the global network by increasing the participation of firms that were peripheral before the legal changes. In contrast, the closure of firms' alliance networks increased with stronger IPR laws, in line with a complementarity effect that increased the use of social control. The increase in closure was strongest in the networks of the low status entrants into the global network. Using a difference-in-difference empirical design, we found that these changes coincided exactly with the timing of the passage of the laws across thirteen countries between 1988 and 2005. This study addresses issues of great theoretical and practical importance to the literatures on institutions, networks, and IPR. In an increasingly knowledge-based economy, interfirm collaborations are essential for many firms and industries. These collaborations are often globally dispersed because knowledge and resources are widely distributed across countries (Rosenkopf and Almei...

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Determinants of patent rights: A cross-national study

Cited by 1,008 publications

References 8 publications

Stage-dependent intellectual property rights

Stage-dependent intellectual property rights

Determinants of quadic patenting: Market access, imitative threat, competition and strength of intellectual property rights

Liberty in Law? Intellectual Property Rights and Global Alliance Networks

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