Sharmila Vishwasrao () (Department of Economics, College of Business, Florida Atlantic University) Srabana Gupta (The Penn State University, Erie) Hassan Benchekroun () (Department of Economics, McGill University, Montreal, Canada)
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We study a developing country's choice of optimum tariffs and patent length in a theoretical model of trade and technology transfer. A Northern firm chooses whether to export or produce a new good in a Southern country. In the absence of patent protection, a high tariff is required to induce FDI. This reduces Southern welfare when the good is imported. The Southern government can combine a positive patent length with tariffs to reduce this loss and induce FDI. Thus Southern countries may have an incentive to protect patents, although never to the same extent as Northern countries.
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Paper provided by Department of Economics, College of Business, Florida Atlantic University in its series Working Papers with number
04022.
Length: 19 pages Date of creation: Oct 2004 Date of revision:
May 2005 Publication status: Forthcoming in International Review of Economics & Finance Handle: RePEc:fal:wpaper:04022
Find related papers by JEL classification: O34 - Economic Development, Technological Change, and Growth - - Technological Change - - - Intellectual Property Rights F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
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