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Interactive effects of monetary policy and patent protection: The role of endogenous innovation size

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  • Lu, You-Xun

Abstract

This study revisits the growth effects of monetary policy, patent breadth, and blocking patents in a monetary Schumpeterian model. In the economy, there are cash constraints on R&D investment and the step size of innovation is endogenous. Within this framework, innovation policies affect economic growth through the arrival rate and the quality size of innovation. We find that with an endogenous innovation size, each of the three innovation policy instruments may have an inverted-U-shaped effect on growth. Moreover, we calibrate the model and quantify the interactive effects of innovation policies. Our results show that the interaction of different innovation policies significantly influences the growth effect of a single policy.

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  • Lu, You-Xun, 2022. "Interactive effects of monetary policy and patent protection: The role of endogenous innovation size," Economic Modelling, Elsevier, vol. 113(C).
    • Handle: RePEc:eee:ecmode:v:113:y:2022:i:c:s0264999322001559
    DOI: 10.1016/j.econmod.2022.105909
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    More about this item

    Keywords

    R&D; Economic growth; Monetary policy; Patent breadth; Blocking patents;
    All these keywords.

    JEL classification:

    • E41 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Demand for Money
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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