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Compulsory Licensing And Patent Protection: A North-South Perspective

In: Technology Transfer, Foreign Direct Investment, and the Protection of Intellectual Property in the Global Economy

Author

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  • Eric W. Bond
  • Kamal Saggi

Abstract

In a stylised model involving a developing country (called South) and a foreign patent holder, we analyse whether and how the incidence and social value of compulsory licensing (CL) depends upon the South’s patent protection policy. If South is free to deny patent protection, CL fails to arise in equilibrium and the option to use it makes both parties worse off. If South is obliged to offer patent protection, CL can occur and even yield a Pareto improvement. The ability to control price increases the South’s incentive for patent protection as well as the likelihood of CL…

Suggested Citation

  • Eric W. Bond & Kamal Saggi, 2023. "Compulsory Licensing And Patent Protection: A North-South Perspective," World Scientific Book Chapters, in: Kamal Saggi (ed.), Technology Transfer, Foreign Direct Investment, and the Protection of Intellectual Property in the Global Economy, chapter 21, pages 481-503, World Scientific Publishing Co. Pte. Ltd..
    • Handle: RePEc:wsi:wschap:9789813233027_0021
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    Cited by:

    1. is not listed on IDEAS
    2. 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.
    3. Eric W. Bond & Kamal Saggi, 2023. "Patent protection in developing countries and global welfare: WTO obligations versus flexibilities," World Scientific Book Chapters, in: Kamal Saggi (ed.), Technology Transfer, Foreign Direct Investment, and the Protection of Intellectual Property in the Global Economy, chapter 22, pages 505-520, World Scientific Publishing Co. Pte. Ltd..
    4. Senra de Morais, Rafael Pinho, 2017. "Compulsory licensing of pharmaceuticals by the developing south," Economics Letters, Elsevier, vol. 161(C), pages 74-77.
    5. Carmine Guerriero, 2023. "Property rights, transaction costs, and the limits of the market," Economics of Governance, Springer, vol. 24(2), pages 143-176, June.

    More about this item

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    JEL classification:

    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements

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