Does intellectual property lead to economic growth? Insights from a novel IP dataset

Abstract

While policymakers often make bold claims as to the positive impact of intellectual property (IP) rights on both developed and developing country economies, the empirical literature is more ambiguous. IP rights have both incentive and inhibitory effects that are difficult to isolate in the abstract and are dependent on economic context. To unravel these contradictory effects, this article introduces an index that evaluates the strength of IP protection in 124 developing countries for the years 1995 to 2011. We illustrate the value of this index to economics study and show evidence that is consistent with IP leading to increased growth. Our results are further consistent with two causal pathways highlighted in the literature: that IP leads to greater levels of technology transfer and increased domestic inventive activity. Yet other aspects of our study fit uneasily with this simple story. For example, we find evidence suggesting that increased levels of growth lead to greater levels of IP protection, contradictory evidence in the literature linking IP with growth, a lack of evidence that increased levels of IP protection lead to actual use of the IP system, and problems with what IP indexes measure. Because of this, we suggest anotherand so far undertheorizedexplanation of the links between IP and growth: that IP may have few direct effects on growth and that any causality is a result of belief rather than actual deployment of IP.

The fall of the innovation empire and its possible rise through open science

“…The economics literature is frustratingly in no better position today than it was in the 1950s to answer the question of whether patents increase or decrease overall innovation ( William, 2017 ; Gallini, 2017 ; Sampat and Williams, 2018 ; Hall, 2019 ). Further, there is evidence that, while intellectual property and economic growth are correlated, the direction of causation may be from growth to higher levels of intellectual property protection, mediated by politics, rather than from intellectual property to growth ( Morin and Gold, 2014 ; Gold et al., 2019 ). We do know that certain industries have constructed themselves around the availability of patents and hence incumbents remain dependent on them ( Hall and Harhoff, 2012 ; Galasso and Schankerman, 2015 ).…”

Mapping the New Frontier of International IP Law: Introducing a TRIPs-plus Dataset

“…Variables were selected on the basis of the TRIPs-plus provisions identified in previous research by Fink and Reichenmiller (2006), El Said 2007, Lindstrom (2009), Morin and Gold (2014), Cottier et al (2017), and Gold et al (2018). We added some variables following an inductive exploration of the PTAs.…”

“…Moreover, when countries sign a PTA, they generally agree to implement the IP provisions by the time the PTA comes into force (Deere, 2008). Therefore, there should be a clear positive correlation between domestic IP rules before the PTAs entered into force and TRIPs-plus provisions We use the domestic IP index introduced by Gold et al (2018). In contrast to other indexes of domestic IP law, this index focus on TRIPs-plus measures and its components are similar to variables making the T + PTA index.…”

The Effects of Plant Breeders’ Rights on Wheat Productivity and Varietal Improvement in South African Agriculture

“…Gold et al [28]. examined the questionable issue on the positive impact of IPRs on economic growth in developed and developing countries.…”