Dynamic intellectual property protection (IPP) displays avenues of cooperation or mutual interest that can arise when the model is adjusted to incorporate reasonable features of the economic environment. For example, we explain why it is often in the South’s interest to maintain equal or higher standards of IPP protection than in the North, just as it is possible that the North gains from weaker IPP enforcement in the South. These findings contrast with the more accepted conclusion that it is never in the interest of the non-innovating South to increase the rate of intellectual property protection. Key features previously overlooked include the ability of lower Southern IPP to spur innovation of Northern goods and to make available greater resources for Northern production of current consumption.

Abstract. This paper analyzes the main economic issues of intellectual property rights (IPRs) protection in the context of the World Trade Organization (WTO). A retrospective view on the establishment of the TRIPS (trade-related aspects of intellectual property rights) Agreement, a still controversial accomplishment of the Uruguay Round of trade liberalization, is provided. The paper reviews the economic rationale for the harmonization of IPRs, drawing both on economic theory considerations as well as emerging empirical evidence. The logic of linking IPR protection and trade in the context of the WTO is also re-examined. Some specific attention is devoted to the implications of TRIPS for agricultural and biotechnology innovations. The impact that IPR protection can have in promoting growth and development, and the relation of IPRs with other economic policies, is discussed. The paper concludes with an analysis of the prospects for more (or less) IPRs-related consensus in the current round of WTO negotiations. GianCarlo Moschini is professor of economics, and Pioneer Hi-bred

Association Meetings in Washington D.C. for helpful comments. We are indebted to Robert Deacon for providing the lead data. Qiu is grateful for financial support by Hong Kong Government RGC Sustainable development has been a popular buzzword amongst policymakers and economists for over a decade. Although a key tenet of maintaining a sustainable development path for many economies rests on attracting mobile capital, theoretical and empirical evidence into the institutional policies that attract factors remains largely unresolved. This paper takes a positive look at the determinants of attracting capital with particular attention paid to intellectual property rights and environmental regulations. JEL Classification: F23, O34, Q28 Inducing economies to follow a sustainable development trajectory has been an important global policy objective since delegations from 178 countries met in Rio de Janeiro during the first two weeks of June 1992. The meeting, known popularly as the Earth Summit of 1992, was the culmination of more than two decades of debate concerning the relationship

This paper studies the relationship between intellectual property rights (IPR) and the entry modes decision by multinational firms. A model is developed allowing firms to choose among export, foreign direct investment (FDI), and licensing. Firms in the recipient country may imitate the technology, and their abilities to do so depend both on the nature of each mode and on the level of IPR protections in that country. Empirical analysis is conducted on the 1995 data. It is shown that unlike the findings in the literature, however, strong IPR impacts positively on FDI more than on licensing. JEL classification: F1, L0

Note: Center Discussion Papers are preliminary materials circulated to stimulate discussions and critical comments. We are most indebted to T. Paul Schultz and Doug Gollin for their time and trouble. We would also like

This paper presents a panel study of yield developments in the eight main crops over the period from 1961 to 1999 and shows that for most crops, there is absolute convergence to developed-country levels over that time period. Where convergence fails to occur, this can be explained by the exceptionally low rate of diffusion of innovations from developed to developing countries for some crops. We argue that "strong " forms of protection for intellectual property right claims provide a convincing explanation for the presence of these low diffusion rates for these particular crops. If this is the case, then the distribution of the benefits from an effective intellectual property rights regime will depend on the initial position of the country concerned relative to the technological frontier. The existence of this innovation-diffusion trade-off highlights the problematic international welfare implications inherent in choosing a particular regime of intellectual property protection.

The theoretical model presented in this paper builds upon and extends that presented in Branstetter, Fisman, Foley, and Saggi (2007). We thank Ray Fisman and Fritz Foley for their contributions to that earlier work and for useful comments on this research. All errors remain our own. Views expressed are those of the authors and do not necessarily reflect those of the Bureau of Economic Analysis or

We analyze intellectual property rights (IPR) enforcement in a developing country where information asymmetry between a foreign multinational and domestic consumers gives rise to the need for signaling by the multinational. The signaling distorts the multinational’s entry decision even when IPR enforcement is perfect. Our analysis derives implications consistent with empirical observations: better IPR enforcement encourages the multinational’s entry but exhibits an inverse U-shaped relation with their incentives to develop new technologies. Compared with perfect enforcement, moderately weak IPR enforcement, which does not fully deter copycats from stealing the multinational’s technology, can benefit both the host country and the multinational. Our analysis thus sheds new light into IPR policies in developing countries and cautions policy implications drawn from empirical studies.

It is widely believed that an important factor underlying the rapid growth in China is increased foreign direct investment (FDI) and the transfer of foreign technology capital, which is accumulated know-how from investment in research and development (R&D), brands, and organizations that is not specific to a plant. In this paper, we study two channels through which FDI can contribute to upgrading of the stock of technology capital: knowledge spillovers and appropriation. Knowledge spillovers lead to new ideas that do not directly compete or devalue the foreign affiliate’s stock. Appropriation, on the other hand, implies a redistribution of property rights over patents and trademarks; the gain to domestic companies comes at a loss to the multinational company (MNC). In this paper we build these sources of technology capital transfer into the framework developed by McGrattan and Prescott (2009, 2010) and introduce an endogenously-chosen intensity margin for operating technology capital in order to capture the trade-offs MNCs face when expanding their markets internationally. We first demonstrate that abstracting from technology capital transfers results in predicted bilateral FDI inflows to China that are grossly at odds with the data. We then use the bilateral inflows to parameterize the model with technology capital transfers and compute the