Intellectual Property Rights and International Trade of Agricultural Products

Abstract

The signing of the agreement on Trade-Related Aspects on Intellectual Property Rights (TRIPS) had led to a process of global harmonization and tightening of intellectual property rights (IPRs) systems. As part of this process, the use of IPRs in agriculture has been increasing in the last decades. This paper studies the effect of intellectual property rights on agricultural trade, for the post-TRIPS period (1995-2011), using a new yearly index of IPRs, for 60 developed and developing countries. We study the effect of stronger IPRs on total trade, bilateral trade, and trade margins using different econometric techniques. We found that the strengthening of IPRs has been having a negative and uneven effect on agricultural trade at different levels of disaggregation. The gravity estimation showed that both the IPRs of the importer and the exporter have negative effects on total bilateral trade and that the probability of creating new bilateral trade links increases with the importer's IPRs. Finally, we found that stronger IPRs have a negative effect on the intensive margin of trade and a positive impact on the extensive margin. Overall, the evidence shows that agricultural trade related to the developing world has been more negatively affected, which calls the attention to the idea that a common system can equally work for all countries.

The role of intellectual property rights in seed technology transfer through trade: evidence from U.S. field crop seed exports

“…Previous studies of trade in manufactures have found IPRs to have a positive effect on exports, for example, Maskus and Penubarti (), Smith (), and Ivus (), while Campi and Dueñas () found that stronger IPRs have had a negative effect on trade in agricultural products. In the case of seed trade, Yang and Woo () and Eaton () both failed to detect a statistically significant effect of IPRs, while Galushko () found the positive impact of IPRs varied across different groups of crops.…”

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

“…The restrictions on access to existing genetic material presented by IPRs in plant varieties may affect breeding programs, although there may be legislative exceptions that provide access to such material for R&D purposes [5]. The protection from the IPRs can lead to high concentration and creation of monopolistic actors in seed input markets that adversely impact local innovations, market development and productivity [8,11]. On the contrary, Wright and Pardey [16] argue that since the diffusion of IPRs across the world, developments in scientific innovations (rather than IPRs) have contributed to yield improvements.…”

“…Campi and Duenas [11] explored the effects of IPRs on agricultural trade for the period of 1995 to 2011 using an IPRs index for 60 countries since the signing of the TRIPS agreement. Various econometric methods were used on panel data of the 60 countries, comprising 28 developed countries and 32 developing countries.…”

“…For example, Tripp et al [6], based on case studies from China, Colombia, India, Kenya and Uganda, found that development of PVP systems in developing countries were inadequate for stimulating the development of the local commercial seed sector, and recommended that efforts need to be integrated into broader seed system development strategies. Furthermore, the monopoly power provided through IPRs has been argued to negatively affect domestic innovation, technology transfer, local market development and agricultural productivity [11].…”

Intellectual property rights, imitation, and development. The effect on cross-border mergers and acquisitions

“…The recent process of harmonization and strengthening of intellectual property rights (IPRs) systems is expected to have implications for global relations among countries (Maskus 2012). However, the effect of IPRs on international trade, foreign direct investment (FDI), technology transfer, and mergers and acquisitions (M&As) is not clear either from a theoretical perspective or from an empirical point of view (Maskus and Penubarti 1995;Maskus 2000;Foley et al 2006;Campi and Dueñas 2016).…”