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Do Stronger Intellectual Property Rights Increase International Technology Transfer? Empirical Evidence from U.S. Firm-Level Data

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  • Lee Branstetter
  • Raymond Fisman
  • C. Fritz Foley
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    Abstract

    This paper examines how technology transfer within U.S. multinational firms changes in response to a series of IPR reforms undertaken by 16 countries over the 1982-1999 period. Analysis of detailed firm-level data reveals that royalty payments for technology transferred to affiliates increase at the time of reforms, as do affiliate R&D expenditures and total levels of foreign patent applications. Increases in royalty payments and R&D expenditures are concentrated among affiliates of parent companies that use U.S. patents extensively prior to reform and are therefore expected to value IPR reform most. For this set of affiliates, increases in royalty payments exceed 30 percent. Our results collectively imply that U.S. multinationals respond to changes in IPR regimes abroad by significantly increasing technology transfer to reforming countries.

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    Bibliographic Info

    Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 11516.

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    Date of creation: Aug 2005
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    Publication status: published as Branstetter, Lee G., Raymond Fisman and C. Fritz Foley. "Do Stronger Intellectual Property Rights Increase International Technology Transfer? Empirical Evidence From U.S. Firm-Level Panel Data," Quarterly Journal of Economics, 2006, v121(1,Feb), 321-349.
    Handle: RePEc:nbr:nberwo:11516

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    Cited by:
    1. Eicher, Theo & García-Peñalosa, Cecilia, 2008. "Endogenous strength of intellectual property rights: Implications for economic development and growth," European Economic Review, Elsevier, vol. 52(2), pages 237-258, February.
    2. Mugele, Christian & Schnitzer, Monika, 2008. "Organization of multinational activities and ownership structure," International Journal of Industrial Organization, Elsevier, vol. 26(6), pages 1274-1289, November.
    3. Andrea Fernández-Ribas & Philip Shapira, 2009. "Technological diversity, scientific excellence and the location of inventive activities abroad: the case of nanotechnology," The Journal of Technology Transfer, Springer, vol. 34(3), pages 286-303, June.
    4. Crespo, Nuno & Fontoura, Maria Paula, 2007. "Determinant Factors of FDI Spillovers - What Do We Really Know?," World Development, Elsevier, vol. 35(3), pages 410-425, March.
    5. Thomas Farole & Gokhan Akinci, 2011. "Special Economic Zones : Progress, Emerging Challenges, and Future Directions," World Bank Publications, The World Bank, number 2341, October.

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