Do cross‐border patents promote trade?

Abstract

While we would expect that cross-border patents are used to protect a technology that is made available in another country, that technology could either be produced locally or imported. International patent filings could therefore be either complements or substitutes to international trade. This study combines data on patenting and trade for 149 countries and 249 industries between 1974 and 2006 with a "three-way" panel data model that addresses several biases emphasized in the trade literature in order to provide a systematic analysis of how bilateral trade responds to cross-border patent filings. We find that cross-border patents have a positive (complementary) overall effect on the patent-filing country's exports to the patent-granting country and no effect overall on imports flowing in the opposite direction. These effects vary substantially across industry groups, with patents promoting significantly more export growth in industries with a high demand elasticity and in industries that are relatively more downstream in supply chains. We also find that patents, once obtained, are associated with increased trade even in jurisdictions with weak intellectual property regimes. Résumé. Les brevets transfrontaliers favorisent-ils le commerce international?Les brevets transfrontaliers sont généralement utilisés pour protéger une technologie qui est rendue disponible dans un autre pays, mais cette technologie pourrait y être produite localement ou être importée. Les dépôts de brevets à l'étranger et le commerce international pourraient donc être complémentaires ou substituables. Cette étude combine des données sur les brevets et le commerce couvrant 149 pays et 249 industries entre 1974 et 2006. Nous utilisons un modèle de données de panel à effets fixes « trois voies » qui répond à plusieurs biais soulignés dans la littérature afin de fournir une analyse systématique de l'impact des dépôts de brevets transfrontaliers sur le commerce international. Nous constatons que les brevets transfrontaliers ont un effet

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