Optimal intellectual property rights policy by an importing country

Takeshi Ikeda, Tadanobu Tanno and Yoshihito Yasaki

Economics Letters, 2021, vol. 209, issue C

Abstract: We study the optimal intellectual property rights policies of an importing country with a large market in which producers are not based. We show that the government should ban imitation if the cost of innovation is low, and should not allow free imitation regardless of the cost of innovation. Moreover, social welfare under a monopoly can exceed that under Cournot duopoly, given relatively low-cost innovation. Thus, when the cost of innovation is low, entry restriction can raise social welfare, even when innovators are based in other countries.

Keywords: R&D investment; Innovation; Imitation; Intellectual property rights; Export destination market (search for similar items in EconPapers)
JEL-codes: F12 L12 L13 L52 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:209:y:2021:i:c:s0165176521003906

DOI: 10.1016/j.econlet.2021.110113

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