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Economic Growth with Imperfect Protection of Intellectual Property Rights

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  • Ryo Horii

    ()

  • Tatsuro Iwaisako

    ()

Abstract

This paper examines the growth effects of intellectual property right (IPR) protection in a quality-ladder model of endogenous growth. Stronger IPR protection, which reduces the imitation probability, increases the reward for innovation. However, stronger protection also gradually reduces the number of competitive sectors, in which innovation is easier than in monopolistic sectors. With free entry to R&D, the number of researchers in each remaining competitive sector increases, but the concentration of R&D activity raises the possibility of unnecessary duplication of innovation, thereby hindering growth. Consequently, imperfect rather than perfect protection maximizes growth. Welfare and scale effects are also examined.

(This abstract was borrowed from another version of this item.)

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Bibliographic Info

Article provided by Springer in its journal Journal of Economics.

Volume (Year): 90 (2007)
Issue (Month): 1 (January)
Pages: 45-85

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Handle: RePEc:kap:jeczfn:v:90:y:2007:i:1:p:45-85

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Web page: http://www.springerlink.com/link.asp?id=108909

Related research

Keywords: intellectual property rights; endogenous growth; quality ladder; imitation; leapfrogging; duplication; O31; O34; O41;

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