IDEAS home Printed from https://ideas.repec.org/p/por/fepwps/292.html
   My bibliography  Save this paper

One size does not fit all… An economic development perspective on the asymmetric impact of Patents on R&D

Author

Listed:
  • Alexandre Almeida

    (Faculdade de Economia, Universidade do Porto)

  • Aurora A.C. Teixeira

    (INESC Porto, CEMPRE, Faculdade de Economia, Universidade do Porto)

Abstract

Innovation is the building block of competitive advantages and thus economic policies are increasingly focused on creating stimulus to increase a country’s innovative performance and growth potential, namely through knowledge accumulation in general and R&D in particular. In this context, current policy trend seems to support the strengthening of Intellectual Property Rights (IPR), in particular, patent protection, with the argument that positive effects will emerge and would be extensive to all countries regardless their level of development. In this paper we question this “one size fits all” policy and assess how patent thicket affects knowledge productive investment taking into account countries’ development levels. Based on a panel of 95 countries over a ten-year period (1997-2006), our results show that patents have asymmetric impacts across countries development stages, evidencing pervious effects on technological leaders and positive ones on some laggards. Such evidence sustains that innovation policies be adjusted to countries development stages.

Suggested Citation

  • Alexandre Almeida & Aurora A.C. Teixeira, 2008. "One size does not fit all… An economic development perspective on the asymmetric impact of Patents on R&D," FEP Working Papers 292, Universidade do Porto, Faculdade de Economia do Porto.
    • Handle: RePEc:por:fepwps:292
    as

    Download full text from publisher

    File URL: http://www.fep.up.pt/investigacao/workingpapers/08.09.18_wp292.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Niosi, Jorge & Reid, Susan E., 2007. "Biotechnology and Nanotechnology: Science-based Enabling Technologies as Windows of Opportunity for LDCs?," World Development, Elsevier, vol. 35(3), pages 426-438, March.
    2. Gould, David M. & Gruben, William C., 1996. "The role of intellectual property rights in economic growth," Journal of Development Economics, Elsevier, vol. 48(2), pages 323-350, March.
    3. Furukawa, Yuichi, 2007. "The protection of intellectual property rights and endogenous growth: Is stronger always better?," Journal of Economic Dynamics and Control, Elsevier, vol. 31(11), pages 3644-3670, November.
    4. Montobbio, Fabio & Rampa, Francesco, 2005. "The impact of technology and structural change on export performance in nine developing countries," World Development, Elsevier, vol. 33(4), pages 527-547, April.
    5. Robert M. Hunt, 2006. "When Do More Patents Reduce R&D?," American Economic Review, American Economic Association, vol. 96(2), pages 87-91, May.
    6. Peretto, Pietro F., 1999. "Industrial development, technological change, and long-run growth," Journal of Development Economics, Elsevier, vol. 59(2), pages 389-417, August.
    7. Teubal, Morris, 1996. "R&D and technology policy in NICs as learning processes," World Development, Elsevier, vol. 24(3), pages 449-460, March.
    8. Chen, Yongmin & Puttitanun, Thitima, 2005. "Intellectual property rights and innovation in developing countries," Journal of Development Economics, Elsevier, vol. 78(2), pages 474-493, December.
    9. Zeng, Jinli, 2001. "Innovative vs. imitative R&D and economic growth," Journal of Development Economics, Elsevier, vol. 64(2), pages 499-528, April.
    10. Kaufmann, Daniel & Kraay, Aart & Mastruzzi, Massimo, 2007. "Governance Matters VI: Aggregate and Individual Governance Indicators, 1996-2006," Policy Research Working Paper Series 4280, The World Bank.
    11. Helpman, Elhanan, 1993. "Innovation, Imitation, and Intellectual Property Rights," Econometrica, Econometric Society, vol. 61(6), pages 1247-1280, November.
    12. Figueiredo, Octávio & Guimarães, Paulo & Woodward, Douglas, 2010. "Vertical disintegration in Marshallian industrial districts," Regional Science and Urban Economics, Elsevier, vol. 40(1), pages 73-78, January.
    13. Carl Shapiro, 2001. "Navigating the Patent Thicket: Cross Licenses, Patent Pools, and Standard Setting," NBER Chapters, in: Innovation Policy and the Economy, Volume 1, pages 119-150, National Bureau of Economic Research, Inc.
    14. Baudry, Marc & Dumont, Beatrice, 2006. "Comparing firms' triadic patent applications across countries: Is there a gap in terms of R&D effort or a gap in terms of performances?," Research Policy, Elsevier, vol. 35(2), pages 324-342, March.
    15. Encaoua, David & Guellec, Dominique & Martinez, Catalina, 2006. "Patent systems for encouraging innovation: Lessons from economic analysis," Research Policy, Elsevier, vol. 35(9), pages 1423-1440, November.
    16. Lorentzen, Jochen, 2005. "The absorptive capacities of South African automotive component suppliers," World Development, Elsevier, vol. 33(7), pages 1153-1182, July.
    17. Basant, Rakesh & Chandra, Pankaj, 2007. "Role of Educational and R&D Institutions in City Clusters: An Exploratory Study of Bangalore and Pune Regions in India," World Development, Elsevier, vol. 35(6), pages 1037-1055, June.
    18. Reddy, Prasada, 1997. "New trends in globalization of corporate R&D and implications for innovation capability in host countries: A survey from India," World Development, Elsevier, vol. 25(11), pages 1821-1837, November.
    19. Schneider, Patricia Higino, 2005. "International trade, economic growth and intellectual property rights: A panel data study of developed and developing countries," Journal of Development Economics, Elsevier, vol. 78(2), pages 529-547, December.
    20. Romer, Paul M, 1990. "Endogenous Technological Change," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 71-102, October.
    21. German, Laura & Stroud, Ann, 2007. "A Framework for the Integration of Diverse Learning Approaches: Operationalizing Agricultural Research and Development (R&D) Linkages in Eastern Africa," World Development, Elsevier, vol. 35(5), pages 792-814, May.
    22. Jorge M. S. Valente, 2008. "Beam search heuristics for quadratic earliness and tardiness scheduling," FEP Working Papers 279, Universidade do Porto, Faculdade de Economia do Porto.
    23. Leger, Andreanne, 2005. "Intellectual property rights in Mexico: Do they play a role?," World Development, Elsevier, vol. 33(11), pages 1865-1879, November.
    24. Raut, Lakshmi K., 1995. "R & D spillover and productivity growth: Evidence from Indian private firms," Journal of Development Economics, Elsevier, vol. 48(1), pages 1-23, October.
    25. Glass, Amy Jocelyn & Saggi, Kamal, 1998. "International technology transfer and the technology gap," Journal of Development Economics, Elsevier, vol. 55(2), pages 369-398, April.
    26. Fulvio Castellaci, 2006. "Convergence and Divergence among Technology Clubs," DRUID Working Papers 06-21, DRUID, Copenhagen Business School, Department of Industrial Economics and Strategy/Aalborg University, Department of Business Studies.
    27. Alston, Julian M. & Pardey, Philip G. & Roseboom, Johannes, 1998. "Financing agricultural research: International investment patterns and policy perspectives," World Development, Elsevier, vol. 26(6), pages 1057-1071, June.
    28. Lee, Jaymin, 1996. "Technology imports and R&D efforts of Korean manufacturing firms," Journal of Development Economics, Elsevier, vol. 50(1), pages 197-210, June.
    29. Sakakibara, Mariko & Branstetter, Lee, 2001. "Do Stronger Patents Induce More Innovation? Evidence from the 1988 Japanese Patent Law Reforms," RAND Journal of Economics, The RAND Corporation, vol. 32(1), pages 77-100, Spring.
    30. Hu, Mei-Chih & Mathews, John A., 2005. "National innovative capacity in East Asia," Research Policy, Elsevier, vol. 34(9), pages 1322-1349, November.
    31. Kumar, Nagesh, 1996. "Intellectual property protection, market orientation and location of overseas R&D activities by multinational enterprises," World Development, Elsevier, vol. 24(4), pages 673-688, April.
    32. Keith E. Maskus, 1993. "Intellectual property rights and the Uruguay Round," Economic Review, Federal Reserve Bank of Kansas City, vol. 78(Q I), pages 10-25.
    33. Parello, Carmelo Pierpaolo, 2008. "A north-south model of intellectual property rights protection and skill accumulation," Journal of Development Economics, Elsevier, vol. 85(1-2), pages 253-281, February.
    34. Kodama, Fumio & Suzuki, Jun, 2007. "How Japanese Companies have used Scientific Advances to Restructure their Businesses: The Receiver-Active National System of Innovation," World Development, Elsevier, vol. 35(6), pages 976-990, June.
    35. Diao, Xinshen & Roe, Terry & Yeldan, Erinc, 1999. "Strategic policies and growth: an applied model of R&D-driven endogenous growth," Journal of Development Economics, Elsevier, vol. 60(2), pages 343-380, December.
    36. Vishwasrao, Sharmila & Bosshardt, William, 2001. "Foreign ownership and technology adoption: evidence from Indian firms," Journal of Development Economics, Elsevier, vol. 65(2), pages 367-387, August.
    37. Hobday, Mike, 1995. "East Asian latecomer firms: Learning the technology of electronics," World Development, Elsevier, vol. 23(7), pages 1171-1193, July.
    38. Arora, Ashish, 1996. "Contracting for tacit knowledge: the provision of technical services in technology licensing contracts," Journal of Development Economics, Elsevier, vol. 50(2), pages 233-256, August.
    39. Lanjouw, Jean O. & Cockburn, Iain M., 2001. "New Pills for Poor People? Empirical Evidence after GATT," World Development, Elsevier, vol. 29(2), pages 265-289, February.
    40. Kremer, Michael & Zwane, Alix Peterson, 2005. "Encouraging Private Sector Research for Tropical Agriculture," World Development, Elsevier, vol. 33(1), pages 87-105, January.
    41. 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.
    42. Choung, Jae-Yong & Hwang, Hye-Ran & Choi, Jin-Ho & Rim, Myung-Hwan, 2000. "Transition of Latecomer Firms from Technology Users to Technology Generators: Korean Semiconductor Firms," World Development, Elsevier, vol. 28(5), pages 969-982, May.
    43. Mathews, John A. & Hu, Mei-Chih, 2007. "Enhancing the Role of Universities in Building National Innovative Capacity in Asia: The Case of Taiwan," World Development, Elsevier, vol. 35(6), pages 1005-1020, June.
    44. Varsakelis, Nikos C., 2001. "The impact of patent protection, economy openness and national culture on R&D investment: a cross-country empirical investigation," Research Policy, Elsevier, vol. 30(7), pages 1059-1068, August.
    45. Fan, Shenggen & Fang, Cheng & Zhang, Xiaobo, 2003. "Agricultural Research and Urban Poverty: The Case of China," World Development, Elsevier, vol. 31(4), pages 733-741, April.
    46. Keith E. Maskus, 2000. "Intellectual Property Rights in the Global Economy," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 99, January.
    47. Katrak, Homi, 1997. "Developing countries' imports of technology, in-house technological capabilities and efforts: an analysis of the Indian experience," Journal of Development Economics, Elsevier, vol. 53(1), pages 67-83, June.
    48. Connolly, Michelle, 2003. "The dual nature of trade: measuring its impact on imitation and growth," Journal of Development Economics, Elsevier, vol. 72(1), pages 31-55, October.
    49. Nuno Torres & Oscar Afonso, 2008. "Re-evaluating the impact of natural resources on economic growth," FEP Working Papers 278, Universidade do Porto, Faculdade de Economia do Porto.
    50. Hasan, Rana, 2002. "The impact of imported and domestic technologies on the productivity of firms: panel data evidence from Indian manufacturing firms," Journal of Development Economics, Elsevier, vol. 69(1), pages 23-49, October.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Pamela J. Smith & Sebastian J. Anti, 2022. "How does TRIPs compliance affect the economic growth of developing countries? Application of the Synthetic Control method," The World Economy, Wiley Blackwell, vol. 45(12), pages 3873-3906, December.
    2. Elif Bascavusoglu & Maria Pluvia Zuniga, 2005. "The effects of intellectual property protection on international knowledge contracting," Cahiers de la Maison des Sciences Economiques bla05009, Université Panthéon-Sorbonne (Paris 1).
    3. Hudson, John & Minea, Alexandru, 2013. "Innovation, Intellectual Property Rights, and Economic Development: A Unified Empirical Investigation," World Development, Elsevier, vol. 46(C), pages 66-78.
    4. Shiyuan Pan & Mengbo Zhang & Heng-fu Zou, 2011. "Patent Protection, Financial Development and Economic Growth," CEMA Working Papers 589, China Economics and Management Academy, Central University of Finance and Economics.
    5. Alexandre Almeida & Aurora A.C. Teixeira, 2007. "Does Patenting negatively impact on R&D investment?An international panel data assessment," FEP Working Papers 255, Universidade do Porto, Faculdade de Economia do Porto.
    6. Azevedo, Mónica L. & Afonso, Óscar & Silva, Sandra T., 2014. "Endogenous growth and intellectual property rights: A north–south modeling proposal," Economic Modelling, Elsevier, vol. 38(C), pages 112-120.
    7. Pan, Shiyuan & Zhang, Mengbo & Zou, Heng-Fu, 2018. "Status Preference And The Effects Of Patent Protection: Theory And Evidence," Macroeconomic Dynamics, Cambridge University Press, vol. 22(4), pages 837-863, June.
    8. Angus C. Chu, 2024. "Macroeconomic effects of intellectual property rights: an updated survey," Chapters, in: Walter G. Park (ed.), Handbook of Innovation and Intellectual Property Rights, chapter 2, pages 13-26, Edward Elgar Publishing.
    9. Di Vita, Giuseppe, 2013. "The TRIPs agreement and technological innovation," Journal of Policy Modeling, Elsevier, vol. 35(6), pages 964-977.
    10. 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.
    11. Walter Park, 2012. "North–South models of intellectual property rights: an empirical critique," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 148(1), pages 151-180, April.
    12. Dai, Darong & Shen, Kunrong, 2011. "A New Exploration of Optimal IPR Protection and International Policy Cooperation," MPRA Paper 40039, University Library of Munich, Germany.
    13. Neves, Pedro Cunha & Afonso, Oscar & Silva, Diana & Sochirca, Elena, 2021. "The link between intellectual property rights, innovation, and growth: A meta-analysis," Economic Modelling, Elsevier, vol. 97(C), pages 196-209.
    14. Anja, Breitwieser & Neil, Foster, 2012. "Intellectual property rights, innovation and technology transfer: a survey," MPRA Paper 36094, University Library of Munich, Germany.
    15. Akiyama, Taro & Furukawa, Yuichi, 2009. "Intellectual property rights and appropriability of innovation," Economics Letters, Elsevier, vol. 103(3), pages 138-141, June.
    16. Iain Osgood & Yilang Feng, 2018. "Intellectual property provisions and support for US trade agreements," The Review of International Organizations, Springer, vol. 13(3), pages 421-455, September.
    17. Anna Laura Baraldi & Claudia Cantabene & Giulio Perani, 2014. "Reverse causality in the R&D-patents relationship: an interpretation of the innovation persistence," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 23(3), pages 304-326, April.
    18. Chu, Angus C., 2009. "Macroeconomic Effects of Intellectual Property Rights: A Survey," MPRA Paper 17342, University Library of Munich, Germany.
    19. Zoltán J. Ács & Mark Sanders, 2015. "Patents, knowledge spillovers, and entrepreneurship," Chapters, in: Global Entrepreneurship, Institutions and Incentives, chapter 11, pages 195-212, Edward Elgar Publishing.
    20. Hamid Mohtadi & Stefan Ruediger, 2014. "Intellectual Property Rights and Growth: Is there a Threshold Effect?," International Economic Journal, Taylor & Francis Journals, vol. 28(1), pages 121-135, March.

    More about this item

    Keywords

    growth models; R&D; patents; economic development;
    All these keywords.

    JEL classification:

    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:por:fepwps:292. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/fepuppt.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.