Theory and Empirics of Stage-Dependent Intellectual Property Rights
Series
Economics Working Paper Series
Type
discussion paper
Date Issued
2013-04-05
Author(s)
Abstract
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 stagedependent. 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. Furthermore, we use a dynamic panel regression model to provide empirical evidence that supports the key implication of our theoretical model.
Language
English
Keywords
Economic growth
stage-dependent intellectual property rights
HSG Classification
contribution to scientific community
HSG Profile Area
SEPS - Economic Policy
Refereed
No
Publisher
University of St.Gallen
Publisher place
St. Gallen
Number
1306
Start page
35
Subject(s)
Eprints ID
221833
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Name
EWP-1306.pdf
Size
327.01 KB
Format
Adobe PDF
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