Stronger Intellectual Property Rights Protection Research Articles

Nonmonetary awards and innovation: Evidence from winning China's Top Brand Contest

We use the short-lived, but high-profile, China Top Brand Award to examine the causal effects of nonmonetary awards on firm innovation. To do so, we create a panel dataset by matching official China Top Brand Award recipients to the innovation outputs of listed companies. Results from difference-in-differences estimates show that firms that received the China Top Brand Award have a higher number, and better quality, of filed patents. We find that the positive effects of winning the China Top Brand Award on innovation outputs operate through higher government subsidies to winning firms. We also find that the positive effects of award-winning are stronger among state-owned enterprises, larger enterprises, and better-performing enterprises, as well as in provinces with stronger intellectual property rights protection. Our results are robust to a series of sensitivity checks.

Analysis of the Role of Regulations for the Protection of Intellectual Property Rights and Technological Innovation on the Protection of Creativity in the Television Industry in Indonesia

The Indonesian television industry is undergoing significant transformation fueled by technological innovation and evolving regulatory frameworks surrounding intellectual property rights (IPR) protection. This research investigates the regulatory role of IPR protection and technological innovation on creativity within the Indonesian television sector through quantitative analysis. A sample of 150 stakeholders representing various industry segments participated in the study. Descriptive statistics, correlation analysis, and regression analysis were employed to examine the relationships between IPR protection, technological innovation, and creativity. The findings reveal positive correlations between IPR protection, technological innovation, and creativity, with stronger IPR protection and greater technological innovation associated with higher levels of creativity. Regression analysis further demonstrates the predictive power of IPR protection and technological innovation on creative output within the industry. These results underscore the importance of supportive regulatory environments and technological advancement in fostering creativity and innovation within the Indonesian television industry.

Bank market structure and firm innovation-evidence from China.

This study explores the impact of bank market structure on firm innovation in China using a two-way fixed effects model. Our analysis is based on a dataset comprising 2,412,316 firm-city level observations. Our findings suggest that there exists a U-shaped relationship between bank market structure and firm innovation in China. Specifically, we identify that the financing channel is a crucial pathway through which bank market structure influences firm innovation. Moreover, our results indicate that this relationship is mainly driven by small firms and innovative firms, and is more pronounced in regions with stronger intellectual property rights protection or greater openness to foreign markets. In sum, this study contributes to the existing literature by advancing our understanding of the impact of bank market structure on innovation in Chinese firms.

How can MNEs benefit from internationalizing their R&D across countries with both weak and strong IPR protection?

Although MNEs internationalize their R&D not only in developed countries but also in emerging economies that typically feature weak protection of intellectual property rights (IPR), it remains unclear how this strategic decision affects their productivity performance. This limitation has resulted in a rather incomplete understanding of why some MNEs become more productive through R&D internationalization while others do not. This study develops a new explanation, suggesting that R&D internationalization does not affect the productivity of all MNEs equally because of differences in the idiosyncratic way in which MNEs geographically distribute their R&D units across weak and strong IPR protection countries. In advancing this explanation, the study challenges the view that weak IPR protection is disadvantageous for MNEs by showing that (and specifying how) it: 1) increases the efficacy of MNEs' internal R&D, 2) strengthens the advantages of accessing globally dispersed knowledge, and (3) improves MNEs' ability to exploit cross-country differences in IPR protection. The study enhances understanding of the complex role of IPR protection, shifts scholarly attention from the degree of R&D internationalization to how MNEs should internationalize their R&D, and clarifies how the IPR context of their location choices matters.

The impact of intellectual property rights protection on low-carbon trade and foreign direct investments

Climate negotiations on low-carbon technology transfer have largely revolved around the role of intellectual property rights (IPR). Some countries consider a strong IPR regime to be a necessary condition for technology transfer, while others argue that it limits developing countries' access to affordable green technologies. We contribute to this discussion by assessing the effect of IPR protection on the two main channels of international low-carbon technology transfer, namely trade in low-carbon capital goods and foreign direct investment (FDI) by firms owning low-carbon technologies. Our data describe transfer through these channels among 140 countries in eight climate-friendly technology areas between 2006 and 2015. We find that stronger IPR protection in recipient countries increased transfer in six technology areas (solar PV, solar thermal, wind, heating, lighting, and cleaner vehicles), while the effect is statistically insignificant in the other two (hydro and insulation). The results differ slightly when focusing on the case of non-OECD countries. Stricter IPRs did not have a statistically significant impact on trade in low-carbon capital goods, but they accelerated FDI in almost all low-carbon technology areas.

Culture, intellectual property rights, and technology adoption

This study explains the differences in technology adoption as a result of both culture and intellectual property rights (IPR) protection. We use data for 83 countries and 24 technologies for the time period 1980–2000. An individualistic culture, a strong IPR protection regime, and their joint effect are positively associated with technology adoption. The results hold up to a host of robustness checks.

Patent protection, innovation, and technology transfer in a Schumpeterian economy

Abstract This paper analyzes the cross-country effects of intellectual property rights (IPR) protection on the relative wage, innovation, and technology transfer in a North-South quality-ladder model with innovative Northern R&D and adaptive Southern R&D. The degree of IPR protection in two countries differs in terms of patent breadth, which determines the markups of Northern firms and their Southern affiliates, respectively. In this model, stronger IPR protection in the South leads to a permanent decrease in the North-South wage gap, a temporary increase in the Northern innovation rate, and a permanent increase in technology transfer. By contrast, stronger IPR protection in the North leads to a permanent increase in the North-South wage gap, ambiguous effects on the Northern innovation rate, and a permanent decrease in technology transfer. Finally, we perform a quantitative analysis by calibrating the model to the US-China data, and the numerical results support these policy implications in addition to a welfare implication such that strengthening patent protection in one country leads to sizable welfare improvements in both countries.

The state of intellectual property rights (IPRs) in Latin America and its implications for innovation and growth

This article reviews the primary implications of having strong intellectual property rights (IPRs) for innovation in the context of the situation in Latin America. Specifically, the article reviews the relationships, as found in the literature, between strong IPR protection and important economic and innovation-related variables both for developed and developing countries. Beyond its focus on Latin America, the paper also provides evidence and explains the situation of the different IPR regimes; describes the existing regional and global legislation and initiatives; and looks into the debate regarding the effect of IPRs in developing countries.

Intellectual property rights and global imitation chains: the north–south–east model

This study investigates the effects of intellectual property rights (IPR) protection on economies by proposing a three-pole global economy model. The main proposition of the study is that the classical two-pole approach (north–south) does not reflect the technological heterogeneity and conflicts within the developing world. Therefore, a three-pole world economy model which consists of the following regions has been designed; the north which innovates the northern products, the east which innovates the eastern products and also tries to imitate the northern products, and lastly, the south which tries to imitate both the eastern products and the northern products that have been already imitated by the east. Thus, the model suggests a world system depending on global imitation chains. The numeric simulation results reveal firstly, the northern region benefits from tighter IPR policies in any case; secondly, stronger protection of IPR certainly exerts negative effects in the south while it brings benefits the eastern region in a way that highlights the main contribution of the paper.

Intellectual property as a key driver of business performance: the case of Singapore and its implications for innovation in a knowledge-based economy

While the importance of intellectual capital (IC) for organisational value varies across the enterprise continuum, it is commonly accepted that IC has a generally positive effect on firm performance. It has been observed in the literature that certain variables such as the industry sector and the level of economic development play an important mediating role on the effects of IC on firm performance. It is thus accepted that conditions of the environment in which a firm operates may have a tempering effect on the significance of IC for its performance. One of the most important external factors for organisational value is the level of intellectual property (IP) rights protection granted to patents, copyright, trademarks, etc., in its operating environment. The case of Singapore is a specific example of a country where the emergence of a strong IP rights protection environment coincided with the tremendous development of the country. But since Singapore was already one of the top locations in the world for ease of doing business, the question remains whether its innovation ecosystem evolved because of the IP rights protection advance. The objective of this paper is thus to examine the degree to which an IP rights protection system fosters an environment in which IC can be of significance for firm performance. Preliminary second-level analysis of the aggregate results of a meta-study of the relevant bibliography (2003-2013) demonstrates that the significance of IC is severely undermined for manufacturing firms that operate in environments with weak IP rights protection.

Where do spinouts come from? The role of technology relatedness and institutional context

This paper conceptualizes and empirically examines organizational and institutional antecedents of spinouts (i.e., new businesses created by employees). We deploy multi-level logistic regression modeling methods on a sub-sample of the Global Entrepreneurship Monitor's 2011 survey covering 29 countries. The results reveal that employees who have experience with activities unrelated to the core technology of their organizations are more likely to spin out entrepreneurial ventures, whereas those with experiences related to the core technology are less likely to do so. In support of recent theory, we find that the strength of intellectual property rights and the availability of venture capital have negative and positive effects, respectively, on the likelihood that employees become entrepreneurs. These institutional factors also moderate the effect of technology relatedness such that spinouts by employees with experiences related to core technology are curbed more severely by stronger intellectual property rights protection regimes and lacking of venture capital.

Does stronger intellectual property rights protection matter in developing local R&D outsourcing strategy?

This study examines whether the intellectual property rights (IPR) protection in the host countries has a significant moderating effect on the relationship between local R&D outsourcing strategy and subsidiary productivity. Due to the subsidiary mandate in the host country being categorized as exploitation-orientation or exploration-orientation, we further examine whether there is a different moderating effect for different types of a subsidiary mandate. This analysis takes advantage of the data-set on Taiwan-based subsidiaries and the IPR indices by the World Economic Forum over the 2006–2009 period. The empirical results show that a stronger degree of IPR protection is, on average, found to play a significant moderating role in the influence of R&D outsourcing strategy based on local collaboration relationships. Interestingly, the moderating effects are found to differ between exploitation-orientation and exploration-orientation.

Do intellectual property rights play a role in the economic growth of petro-states?: Some empirical evidence from the GCC countries

The existing literature on the relationship between the strength of a country’s intellectual property rights and rate of growth is still inconclusive. The previous studies on IPRs and economic growth, although quite comprehensive, overlooked the resource-based economies. The role of IPRs in innovation and economic growth in the GCC is expected to be different from that in non-resource-based economies, this is because that the resource-based economies of GCC countries exhibit the characteristics of the “rentier states”. The present study contributes to the ongoing debate over the relationship between intellectual property rights (IPRs) protection and economic growth by providing new empirical evidence from the Gulf Co-operation Council (GCC) petro-states, namely Saudi Arabia, Oman, Bahrain, United Arab Emirates (UAE), Kuwait and Qatar. The present study employs the basic determinants of economic growth as postulated by various economic growth theories and then augmented with measurement of IPRs. To ensure the robustness of the empirical results, the study employs three different approaches of estimations: constant coefficient approach (ordinary least squares (OLS)), the fixed effects approach, and the between effects approach. The analyses in this study utilizes panel data from cross-sectional data on all GCC countries over a span of six years (2008 to 2013). The IPRs index used in this study was developed in 2007 by Property Rights Alliance (USA). All other explanatory variables (initial GDP per capita, inflation, human capital, population, openness, and investment) are from the World Bank’s World Development Indicators (2012). The empirical findings confirm the expectations relating to “traditional” sources of economic growth. However, what is important is that the study does not find any empirical validations with respect to the role of IPRs in promoting economic growth in the GCC petro-states. The study also did not find that stronger IPRs protection in GCC countries reduces economic growth, as the variable of IPRs has a positive sign but is not statistically significant in the three specified models of the study. The insignificant relationship between IPRs and economic growth in the case of GCC countries might be related to the fact that GCC countries are “rentier states” in which IPRs per se are not sufficient to ensure technological progress and innovations. The results suggests that for IPRs to promote innovations and economic growth, a coherent set of complementary policies are required, and that the governments of the GCC countries need to play a positive role in inducing technology acquisition and creation.

Geographical indication protection and rural livelihoods: insights from India and Thailand

The paper synthesises the results from empirical case studies undertaken in India and Thailand on the welfare impacts of geographical indications (GIs). The findings indicate a positive effect from GI protection on the well‐being of farm households and rural poverty. GI protection also preserves the traditional knowledge embedded in a GI good as well as the traditional heritage of the locality that produces the good. The findings support the call for stronger intellectual property rights protection.

Innovation and Intellectual Property Rights in a Product‐cycle Model of Skills Accumulation

AbstractThis paper examines the effects of stronger intellectual property rights protection in the South based on a North–South general‐equilibrium model with foreign direct investment (FDI). Two types of innovation are considered – innovation targeting all products and innovation targeting only imitated products. We show that for both types of innovation, there will be increases in the innovation rate and Northern wage inequality and a decrease in the proportion of Northern unskilled labor if imitation intensity is sufficiently low. As regards the pattern of production, the extent of FDI will increase while the extent of Northern production and Southern production will decrease.

Stage-dependent intellectual property rights

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 stage-dependent. 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.

How global is R&D? Firm-level determinants of home-country bias in R&D

Despite an increasing internationalization of R&D activities by multinational firms, a major portion of corporate R&D still tends to be concentrated in firms’ home countries. We examine the extent to which there exists a home-country bias in the location of R&D activities of 156 major R&D-intensive firms based in Europe, the United States, and Japan during 1995–2002, and develop hypotheses concerning the firm-level determinants of such home-country bias. We define this bias as a share of global R&D activities conducted in the home country that is not proportional to the general attractiveness of the country for multinational firms’ R&D activities. We find home bias to be the predominant pattern, but with substantial variation among firms. The extent of the bias increases with the degree of scale and scope economies in R&D, the coordination costs of international R&D, and the embeddedness of firms’ R&D in home countries’ innovation systems. Technology leadership is associated with greater home bias if the home country provides relatively strong intellectual property rights protection, and firms face potential knowledge dissipation abroad. Our findings imply that home-country bias is, to an important extent, a response to the economics of R&D and the centripetal forces favoring centralization of R&D.

Licensee technological potential and exclusive rights in international licensing: A multilevel model

Granting of exclusive rights is an important consideration for firms using licensing as a mode of entry into foreign markets, as exclusive contracts reduce licensors’ flexibility in a given market during the term of the agreement. By granting exclusivity to a licensee with greater technological potential, the exchange partners can increase the potential transactional value of the licensing agreement. At the same time, a licensee with strong technological potential will increase the threat of transactional hazards due to underinvestment and rent appropriation. In this paper, we develop and empirically test a model that evaluates the balancing of transactional value and transaction costs in exclusive licensing. In particular, we identify the conditions under which exclusive contracts are likely to be granted to foreign licensees with strong technological potential. Empirical results from a multilevel model, based on 375 international licensing agreements of US firms in high-technology industries during 1995–2008, show that licensees with a stronger technological potential are more likely to be granted exclusive rights in countries with strong intellectual property rights protection, and in industries with a high rate of technological change; but are less likely to be granted exclusive rights when there is a high degree of overlap between licensor and licensee products.

Intellectual Property Rights, Quality of Institutions, and Foreign Direct Investment into Developing Asia

Developing Asian countries are strengthening their intellectual property rights (IPR) regime as they themselves become producers of intellectual property. At the same time, developing Asia has attracted large amounts of foreign direct investment (FDI) and this trend is expected to continue in light of the region’s strong growth prospects. In this paper, we explore the relationship between IPR and FDI in developing Asia. To do so, we develop a theoretical model which predicts that stronger IPR protection attracts more FDI in countries with small informal economies — i.e., strong institutions — but not in countries with large informal economies — i.e., weak institutions. Our empirical analysis, based on a threshold effect model, yields some evidence which supports our theoretical model.

Influence of intellectual property, foreign investment, and technological adoption on technology entrepreneurship

Using a multi-level modeling approach, the present study empirically examines how intellectual property rights, inflow of foreign direct investment and barriers to technological adoption affect the likelihood of individuals' entry into technology entrepreneurship in a sample of 20 emerging economies. The results suggest that regimes with strong intellectual property rights protection combined with high levels of foreign direct investment per capita decrease the likelihood of individuals' entry into technology entrepreneurship, whereas low barriers to technological adoption increase this likelihood. These findings contribute to understanding the influence that national institutions and foreign investment exercise on the entrepreneurial behavior of early-stage technology entrepreneurs in emerging economies, for which the extant literature shows mixed results.