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Intellectual property rights and product effectiveness

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  • Stephen P. A. Brown
  • William C. Gruben

Abstract

Recent economic literature concludes that an invention-importing country, where domestic invention is scarce or nonexistent, may reduce its welfare and, in some cases, world welfare, by protecting intellectual property developed elsewhere. The analysis presented in this article uses economic theory to show that such a conclusion may not be fully warranted for a wide range of products, such as antibiotics, fungicides, herbicides, and pesticides, whose effectiveness diminishes with cumulative use. Both developed and developing countries may find that protecting intellectual property rights for these products will enhance welfare - even when their invention is provided for free.

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File URL: http://www.dallasfed.org/assets/documents/research/er/1997/er9704b.pdf
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Bibliographic Info

Article provided by Federal Reserve Bank of Dallas in its journal Economic and Financial Policy Review.

Volume (Year): (1997)
Issue (Month): Q IV ()
Pages: 15-20

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Handle: RePEc:fip:fedder:y:1997:i:qiv:p:15-20

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Keywords: Intellectual property ; Imports;

References

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  1. Diwan, Ishac & Rodrik, Dani, 1991. "Patents, appropriate technology, and North-South trade," Journal of International Economics, Elsevier, vol. 30(1-2), pages 27-47, February.
  2. Judith C. Chin & Gene M. Grossman, 1988. "Intellectual Property Rights and North-South Trade," NBER Working Papers 2769, National Bureau of Economic Research, Inc.
  3. Klemperer, Paul, 1990. "How Broad Should the Scope of Patent Protection Be?," CEPR Discussion Papers 392, C.E.P.R. Discussion Papers.
  4. Elhanan Helpman, 1992. "Innovation, Imitation, and Intellectual Property Rights," NBER Working Papers 4081, National Bureau of Economic Research, Inc.
  5. Vishwasrao, Sharmila, 1994. "Intellectual property rights and the mode of technology transfer," Journal of Development Economics, Elsevier, vol. 44(2), pages 381-402, August.
  6. Gilbert, R. & Shapiro, C., 1988. "Optimal Patent Length And Breadth," Papers 28, Princeton, Woodrow Wilson School - Discussion Paper.
  7. Taylor, M Scott, 1994. "TRIPs, Trade, and Growth," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 35(2), pages 361-81, May.
  8. Deardorff, Alan V, 1992. "Welfare Effects of Global Patent Protection," Economica, London School of Economics and Political Science, vol. 59(233), pages 35-51, February.
  9. Nancy T. Gallini, 1992. "Patent Policy and Costly Imitation," RAND Journal of Economics, The RAND Corporation, vol. 23(1), pages 52-63, Spring.
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Cited by:
  1. Badulescu, Dan & Baylis, Katherine R., 2006. "Pesticide Regulation Under NAFTA: Harmonization in Process?," Commissioned Papers 24163, Canadian Agricultural Trade Policy Research Network.
  2. St├ęphane Mechoulan, 2007. "Market structure and communicable diseases," Canadian Journal of Economics, Canadian Economics Association, vol. 40(2), pages 468-492, May.

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