Overseas R&D activities and intellectual property rights – a longitudinal study of multinational enterprises in emerging economies

Abstract

The purpose of this paper is to examine the influence of intellectual property rights (IPRs) protection on the overseas R&D activities of multinational enterprises (MNEs) in emerging economies and to determine whether the influence differs among the various host countries. To provide further empirical evidence, this analysis takes advantage of the longitudinal dataset and IPRs indices developed by the World Economic Forum (WEF) over the 2002–2006 period. The empirical results show that the IPRs protection in the host countries has a significant influence on the overseas R&D activities of MNEs in emerging economies. Interestingly, the influence of IPRs protection is found to differ significantly between developing and developed countries. A stronger degree of IPRs protection in developing countries is found to result in more overseas R&D activities, while a stronger degree of IPRs protection in developed countries, particularly in industrialised countries, tends to reduce the overseas R&D activities of MNEs in emerging economies. In addition, the degree of IPRs protection in host countries is found to play a significant role in moderating overseas R&D activities.