IDEAS home Printed from https://ideas.repec.org/a/oup/scippl/v42y2015i6p827-840..html
   My bibliography  Save this article

Differential effects of intellectual property rights on innovation and economic performance: A cross-industry investigation

Author

Listed:
  • Kyungchul Cho
  • Changseok Kim
  • Juneseuk Shin

Abstract

Despite many previous studies, the causal relationship among intellectual property rights (IPR) protection, innovation and economic growth remains ambiguous. Focusing on the differential effects of stronger IPR on industries, we suggest four causal paths from IPR through R&D to economic performance. Using firm-level panel data in semiconductor, pharmaceutical and shipbuilding industries in Korea, we find that effective causal paths vary not only by industry but by firm size. Stronger IPR are beneficial to R&D-intensive industries where large domestic firms have strong R&D and IPR capabilities, but have no impact on globalized industries. On the other hand, stronger IPR are detrimental to industries and to small and medium enterprises (SMEs) characterized by limited resources. Thus, to boost innovation and economic growth, IPR policies need to be customized to industries as well as SMEs. Universally strong IPR policies are likely to discourage innovation and growth, causing some industries to suffer.

Suggested Citation

  • Kyungchul Cho & Changseok Kim & Juneseuk Shin, 2015. "Differential effects of intellectual property rights on innovation and economic performance: A cross-industry investigation," Science and Public Policy, Oxford University Press, vol. 42(6), pages 827-840.
    • Handle: RePEc:oup:scippl:v:42:y:2015:i:6:p:827-840.
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1093/scipol/scv009
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Lanjouw, J.O., 1997. "The Introduction of Pharmaceutical Product Patents in India: "Heartless Exploitation of the Poor and Suffering"?," Papers 775, Yale - Economic Growth Center.
    2. Mansfield, E., 1995. "Intellectual Property Protection, Direct Investment, and technology Transfer, Germany, Japan, and the United States," Papers 27, World Bank - International Finance Corporation.
    3. Josh Lerner, 2002. "Patent Protection and Innovation Over 150 Years," NBER Working Papers 8977, National Bureau of Economic Research, Inc.
    4. Wesley M. Cohen & Richard R. Nelson & John P. Walsh, 2000. "Protecting Their Intellectual Assets: Appropriability Conditions and Why U.S. Manufacturing Firms Patent (or Not)," NBER Working Papers 7552, National Bureau of Economic Research, Inc.
    5. Carsten Fink & Keith E. Maskus, 2005. "Intellectual Property and Development : Lessons from Recent Economic Research," World Bank Publications - Books, The World Bank Group, number 7443, December.
    6. Gilbert, Richard J & Newbery, David M G, 1982. "Preemptive Patenting and the Persistence of Monopoly," American Economic Review, American Economic Association, vol. 72(3), pages 514-526, June.
    7. Jean O. Lanjouw, 1997. "Title: The Introduction of Pharmaceutical Product Patents in India: Heartless Exploitation of the Poor and Suffering," Working Papers 775, Economic Growth Center, Yale University.
    8. Lerner, Josh, 1995. "Patenting in the Shadow of Competitors," Journal of Law and Economics, University of Chicago Press, vol. 38(2), pages 463-495, October.
    9. Keith E. Maskus, 2000. "Intellectual Property Rights in the Global Economy," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 99, October.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Pries, Fred & Talebi, Alireza & Schillo, R. Sandra & Lemay, Margaret A., 2016. "Risks affecting the biofuels industry: A US and Canadian company perspective," Energy Policy, Elsevier, vol. 97(C), pages 93-101.
    2. Neves, Pedro Cunha & Afonso, Oscar & Silva, Diana & Sochirca, Elena, 2021. "The link between intellectual property rights, innovation, and growth: A meta-analysis," Economic Modelling, Elsevier, vol. 97(C), pages 196-209.
    3. Haoyang Song & Jianhua Hou & Yang Zhang, 2022. "Patent protection: does it promote or inhibit the patented technological knowledge diffusion?," Scientometrics, Springer;Akadémiai Kiadó, vol. 127(5), pages 2351-2379, May.
    4. Mhamed-Ali El-Aroui & Selma Dellagi & Fouad Ben Abdelaziz, 2021. "The Dilemma of Intellectual Property Agreements and R&D in Developing Economies: A Game Theory Approach," Journal of Quantitative Economics, Springer;The Indian Econometric Society (TIES), vol. 19(3), pages 427-450, September.
    5. Boxu Yang & Xielin Liu & Yuchen Gao & Langmei Zhu, 2023. "A research on the effectiveness of innovation policy for regional innovation under Chinese long-range plan," Science and Public Policy, Oxford University Press, vol. 50(3), pages 491-508.
    6. JinHyo Joseph Yun & EuiSeob Jeong & JinSeu Park, 2016. "Network Analysis of Open Innovation," Sustainability, MDPI, vol. 8(8), pages 1-21, July.
    7. Suominen, Arho & Deschryvere, Matthias & Narayan, Rumy, 2023. "Uncovering value through exploration of barriers - A perspective on intellectual property rights in a national innovation system," Technovation, Elsevier, vol. 123(C).
    8. Evan Capeluck, 2016. "A Comparison of Australian and Canadian Productivity Performance: Lessons for Canada," CSLS Research Reports 2016-07, Centre for the Study of Living Standards.
    9. Jinqiu Li & Yuyou Zou & Mingqiu Li, 2022. "Synergetic evolution of the regional intellectual property management systems in China based on logistic model," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 43(8), pages 3736-3750, December.
    10. Yan Liu & Walter G. Park & Dahai Fu, 2021. "Export quality and patent protection: Stage‐dependent effects in development," Review of Development Economics, Wiley Blackwell, vol. 25(2), pages 601-629, May.
    11. Thakur–Wernz, Pooja & Wernz, Christian, 2022. "Impact of stronger intellectual property rights regime on innovation: Evidence from de alio versus de novo Indian bio-pharmaceutical firms," Journal of Business Research, Elsevier, vol. 138(C), pages 457-473.
    12. Sefa Awaworyi Churchill & Hoang M. Luong & Mehmet Ugur, 2022. "Does intellectual property protection deliver economic benefits? A multi‐outcome meta‐regression analysis of the evidence," Journal of Economic Surveys, Wiley Blackwell, vol. 36(5), pages 1477-1509, December.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Lee Branstetter & Raymond Fisman & C. Fritz Foley, 2005. "Do Stronger Intellectual Property Rights Increase International Technology Transfer? Empirical Evidence from U.S. Firm-Level Data," NBER Working Papers 11516, National Bureau of Economic Research, Inc.
    2. Anja, Breitwieser & Neil, Foster, 2012. "Intellectual property rights, innovation and technology transfer: a survey," MPRA Paper 36094, University Library of Munich, Germany.
    3. Mercedes Campi & Marco Duenas & Matteo Barigozzi & Giorgio Fagiolo, 2016. "Do Intellectual Property Rights Influence Cross-Border Mergers and Acquisitions ?," LEM Papers Series 2016/28, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    4. Di Vita, Giuseppe, 2013. "The TRIPs agreement and technological innovation," Journal of Policy Modeling, Elsevier, vol. 35(6), pages 964-977.
    5. Michele Boldrin & David K. Levine, 2013. "The Case against Patents," Journal of Economic Perspectives, American Economic Association, vol. 27(1), pages 3-22, Winter.
    6. Biancini, Sara & Bombarda, Pamela, 2021. "Intellectual property rights, multinational firms and technology transfers," Journal of Economic Behavior & Organization, Elsevier, vol. 185(C), pages 191-210.
    7. Rentocchini, Francesco, 2011. "Sources and characteristics of software patents in the European Union: Some empirical considerations," Information Economics and Policy, Elsevier, vol. 23(1), pages 141-157, March.
    8. Rosina Moreno & Jordi Suriñach, 2014. "Innovation adoption and productivity growth: evidence for Europe," EKONOMIAZ. Revista vasca de Economía, Gobierno Vasco / Eusko Jaurlaritza / Basque Government, vol. 86(02), pages 62-87.
    9. Chih‐Hai Yang, 2008. "Effects Of Strengthening Intellectual Property Rights In Newly Industrialized Economies: Evidence From Taiwan’S 1994 Patent Reform," Contemporary Economic Policy, Western Economic Association International, vol. 26(2), pages 259-275, April.
    10. Philippe Aghion & Peter Howitt & Susanne Prantl, 2015. "Patent rights, product market reforms, and innovation," Journal of Economic Growth, Springer, vol. 20(3), pages 223-262, September.
    11. Balsmeier, Benjamin & Delanote, Julie, 2015. "Employment growth heterogeneity under varying intellectual property rights regimes in European transition economies: Young vs. mature innovators," Journal of Comparative Economics, Elsevier, vol. 43(4), pages 1069-1084.
    12. Rockett, Katharine, 2010. "Property Rights and Invention," Handbook of the Economics of Innovation, in: Bronwyn H. Hall & Nathan Rosenberg (ed.), Handbook of the Economics of Innovation, edition 1, volume 1, chapter 0, pages 315-380, Elsevier.
    13. Bronwyn H. Hall, 2003. "Business Method Patents, Innovation, and Policy," NBER Working Papers 9717, National Bureau of Economic Research, Inc.
    14. Bronwyn H. Hall, 2014. "Does patent protection help or hinder technology transfer?," Chapters, in: Sanghoon Ahn & Bronwyn H. Hall & Keun Lee (ed.), Intellectual Property for Economic Development, chapter 2, pages 11-32, Edward Elgar Publishing.
    15. Dean Baker, 2016. "Working Paper: Rents and Inefficiency in the Patent and Copyright System: Is There a Better Route?," CEPR Reports and Issue Briefs 2016-12, Center for Economic and Policy Research (CEPR).
    16. Lo, Shih-tse, 2011. "Strengthening intellectual property rights: Experience from the 1986 Taiwanese patent reforms," International Journal of Industrial Organization, Elsevier, vol. 29(5), pages 524-536, September.
    17. Arora, Ashish & Ceccagnoli, Marco & Cohen, Wesley M., 2008. "R&D and the patent premium," International Journal of Industrial Organization, Elsevier, vol. 26(5), pages 1153-1179, September.
    18. Bronwyn H. Hall, 2009. "Business And Financial Method Patents, Innovation, And Policy," Scottish Journal of Political Economy, Scottish Economic Society, vol. 56(s1), pages 443-473, September.
    19. Mario Calderini & Giuseppe Scellato, 2004. "Intellectual property rights as strategic assets: the case of european patent opposition in the telecommunication industry," KITeS Working Papers 158, KITeS, Centre for Knowledge, Internationalization and Technology Studies, Universita' Bocconi, Milano, Italy, revised Jul 2004.
    20. Kamal Saggi, 2016. "Trade, Intellectual Property Rights, and the World Trade Organization," Vanderbilt University Department of Economics Working Papers 16-00014, Vanderbilt University Department of Economics.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:oup:scippl:v:42:y:2015:i:6:p:827-840.. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Oxford University Press (email available below). General contact details of provider: https://academic.oup.com/spp .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.