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Intellectual Property Provisions in North-South Trade Agreements

  • Hoekman, Bernard
  • Saggi, Kamal

Using a repeated game approach, this paper models a North-South trade agreement under which North offers South improved market access (via a tariff reduction) if South agrees to prevent local imitation by strengthening its protection of intellectual property rights (IPRs). We show that such an agreement arises in equilibrium if South's imitative capacity is neither too high nor too low. The paper also considers a scenario where Southern protection of IPRs is induced via a North-South transfer. A comparison of the two instruments shows that one instrument does not unambiguously dominate the other in terms of sustaining cooperation. We also analyze whether and how the availability of the second instrument affects cooperation given that one instrument is already available.

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Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 6460.

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Date of creation: Sep 2007
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Handle: RePEc:cpr:ceprdp:6460
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  1. Panle Gia & Pinelopi K. Goldberg & Shubham Chaudhuri, 2006. "Estimating the Effects of Global Patent Protection in Pharmaceuticals: A Case Study of Quinolones in India," American Economic Review, American Economic Association, vol. 96(5), pages 1477-1514, December.
  2. Keith E. Maskus, 1993. "Intellectual property rights and the Uruguay Round," Economic Review, Federal Reserve Bank of Kansas City, issue Q I, pages 10-25.
  3. McCalman, P., 1999. "Reaping What You Sow: An Empirical Analysis of International Patent Harmonization," ANU Working Papers in Economics and Econometrics 1999-374, Australian National University, College of Business and Economics, School of Economics.
  4. Gene M Grossman & Edwin L Lai, 2004. "International Protection of Intellectual Property," Levine's Working Paper Archive 122247000000000442, David K. Levine.
  5. Eaton, J. & Kortum, S., 1995. "Trade in Ideas: Patenting and Productivity onn the OECD," Papers 34, Boston University - Department of Economics.
  6. Hoekman, Bernard & Saggi, Kamal, 2007. "Tariff bindings and bilateral cooperation on export cartels," Journal of Development Economics, Elsevier, vol. 83(1), pages 141-156, May.
  7. Helpman, Elhanan, 1993. "Innovation, Imitation, and Intellectual Property Rights," Econometrica, Econometric Society, vol. 61(6), pages 1247-80, November.
  8. Kyle Bagwell & Robert W. Staiger, 1988. "A Theory of Managed Trade," NBER Working Papers 2756, National Bureau of Economic Research, Inc.
  9. Lai, Edwin L. -C., 1998. "International intellectual property rights protection and the rate of product innovation," Journal of Development Economics, Elsevier, vol. 55(1), pages 133-153, February.
  10. Lai, Edwin L. -C. & Qiu, Larry D., 2003. "The North's intellectual property rights standard for the South?," Journal of International Economics, Elsevier, vol. 59(1), pages 183-209, January.
  11. Glass, Amy Jocelyn & Saggi, Kamal, 2002. "Intellectual property rights and foreign direct investment," Journal of International Economics, Elsevier, vol. 56(2), pages 387-410, March.
  12. 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.
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