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Foreign patent rights and high-tech exports: evidence from Taiwan

  • Wen-Hsien Liu
  • Ya-Chi Lin

This paper conducts a consecutive pooled data analysis from 1989 to 2000 to investigate the relationship between foreign patent rights (FPRs) and the exports of three high-tech industries in Taiwan: the semiconductor, the information and the communication equipment industries. Following Smith's model setup, empirical results indicate that both market expansion and market power effects do exist in Taiwan's case. In addition, this paper proposes a new hypothesis in which the importing country may exhibit a stronger R&D ability than the exporting country, a case that has not been considered in earlier empirical work. Finally, a test is made to determine if a TRIPS (Trade-related Intellectual Property Rights) agreement has any impact on the FPRs-exports relationship, and no evidence is found of a structural change after the implementation of TRIPS.

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Article provided by Taylor & Francis Journals in its journal Applied Economics.

Volume (Year): 37 (2005)
Issue (Month): 13 ()
Pages: 1543-1555

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Handle: RePEc:taf:applec:v:37:y:2005:i:13:p:1543-1555
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  1. Anderson, James E, 1979. "A Theoretical Foundation for the Gravity Equation," American Economic Review, American Economic Association, vol. 69(1), pages 106-16, March.
  2. Bergstrand, Jeffrey H, 1985. "The Gravity Equation in International Trade: Some Microeconomic Foundations and Empirical Evidence," The Review of Economics and Statistics, MIT Press, vol. 67(3), pages 474-81, August.
  3. Maskus, Keith E. & Penubarti, Mohan, 1995. "How trade-related are intellectual property rights?," Journal of International Economics, Elsevier, vol. 39(3-4), pages 227-248, November.
  4. Smith, Pamela J., 2001. "How do foreign patent rights affect U.S. exports, affiliate sales, and licenses?," Journal of International Economics, Elsevier, vol. 55(2), pages 411-439, December.
  5. M. Scott Taylor, 1993. "TRIPS, Trade, and Technology Transfer," Canadian Journal of Economics, Canadian Economics Association, vol. 26(3), pages 625-37, August.
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