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Are Intellectual Property Rights Unfair?

  • Saint-Paul, Gilles

If redistribution is distortionary, and if the income of skilled workers is due to knowledgeintensive activities and depends positively on intellectual property, a social planner which cares about income distribution may in principle want to use a reduction in Intellectual Property Rights (IPRs) rather than redistributive transfers. On the one hand, such a reduction reduces statis inefficiency. On the other hand, standard redistribution also reduces the level of R and D because it distorts occupational choice. We study this possibility in the context of a model with horizontal innovation, where the government, in addition to taxes and transfers, controls the fraction of innovations that are granted patents. The model predicts that standard redistribution always dominates limitations to IPRs.

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Paper provided by Institut d'Économie Industrielle (IDEI), Toulouse in its series IDEI Working Papers with number 151.

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Date of creation: 2002
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Publication status: Published in Labour Economics, vol.�11, n°1, février 2004, p.�129-144.
Handle: RePEc:ide:wpaper:648
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  1. Saint-Paul, Gilles, 2001. "Distribution and Growth in an Economy with Limited Needs," IZA Discussion Papers 273, Institute for the Study of Labor (IZA).
  2. Romer, Paul M, 1990. "Endogenous Technological Change," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages S71-102, October.
  3. Atkinson, Anthony B., 1970. "On the measurement of inequality," Journal of Economic Theory, Elsevier, vol. 2(3), pages 244-263, September.
  4. Dixit, Avinash K & Stiglitz, Joseph E, 1975. "Monopolistic Competition and Optimum Product Diversity," The Warwick Economics Research Paper Series (TWERPS) 64, University of Warwick, Department of Economics.
  5. Foellmi, Reto & Josef Zweim¸ller, 2002. "Heterogeneous Mark-ups, Demand Composition, and the Inequality-Growth Relation," Royal Economic Society Annual Conference 2002 76, Royal Economic Society.
  6. Jean Tirole, 1988. "The Theory of Industrial Organization," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262200716, June.
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