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Asymmetric Intellectual Property Rights Protection and North-South Welfare

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  • Grinols, Earl L.
  • Lin, Hwan C.

Abstract

We construct a model of dynamic endogenous product innovation and international trade, using it to calculate the welfare effects of lower intellectual property rights (IPR) protection in the non-innovating South than in the innovating North. We find that it is generally in the North’s interest to protect its innovating sector by an import embargo on IPR-offending goods from abroad. We explain the paradoxical outcome where the North gains from weaker IPR enforcement in the South through a decomposition of the dynamic welfare formula. Key features include the ability of lower Southern IPR protection to spur innovation of Northern goods and to make available greater resources for Northern production of current consumption goods. Maintaining Northern IPR standards can be in the South’s interests even though the South would favor lower uniform levels of IPR protection.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 19542.

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Date of creation: Sep 1997
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Handle: RePEc:pra:mprapa:19542

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Related research

Keywords: Intellectual Property Rights; Innovation; Imitation; North; South; Welfare;

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References

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  1. Gene M. Grossman & Elhanan Helpman, 1989. "Endogenous Product Cycles," NBER Working Papers 2913, National Bureau of Economic Research, Inc.
  2. Walter G. Park & Juan Carlos Ginarte, 1997. "Intellectual Property Rights And Economic Growth," Contemporary Economic Policy, Western Economic Association International, vol. 15(3), pages 51-61, 07.
  3. Gould, David M. & Gruben, William C., 1996. "The role of intellectual property rights in economic growth," Journal of Development Economics, Elsevier, Elsevier, vol. 48(2), pages 323-350, March.
  4. Mansfield, Edwin & Schwartz, Mark & Wagner, Samuel, 1981. "Imitation Costs and Patents: An Empirical Study," Economic Journal, Royal Economic Society, Royal Economic Society, vol. 91(364), pages 907-18, December.
  5. M. Scott Taylor, 1993. "TRIPS, Trade, and Technology Transfer," Canadian Journal of Economics, Canadian Economics Association, Canadian Economics Association, vol. 26(3), pages 625-37, August.
  6. Deardorff, Alan V, 1992. "Welfare Effects of Global Patent Protection," Economica, London School of Economics and Political Science, London School of Economics and Political Science, vol. 59(233), pages 35-51, February.
  7. Feinberg, Robert M & Rousslang, Donald J, 1990. "The Economic Effects of Intellectual Property Right Infringements," The Journal of Business, University of Chicago Press, University of Chicago Press, vol. 63(1), pages 79-90, January.
  8. Edwin Mansfield, 1986. "Patents and Innovation: An Empirical Study," Management Science, INFORMS, INFORMS, vol. 32(2), pages 173-181, February.
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Cited by:
  1. Lin, Hwan C., 2013. "Optimal Patent Life in a Variety-Expansion Growth Model," MPRA Paper 49790, University Library of Munich, Germany.
  2. Lin, Hwan C. & Russo, Benjamin, 1999. "A Taxation Policy Toward Capital, Technology and Long-Run Growth," Journal of Macroeconomics, Elsevier, Elsevier, vol. 21(3), pages 463-491, July.

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