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Does Host Country Intellectual Property Protection Matter for Technology-Intensive Import Flows?

Ridwan Ah Sheikh and Sunil Kanwar
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Ridwan Ah Sheikh: Department of Economics, Delhi School of Economics

No 329, Working papers from Centre for Development Economics, Delhi School of Economics

Abstract: Using disaggregated industry level data for 1976-2019, we find, unlike much of the received literature, that patent rights have a strong positive effect on developing country knowledge-intensive imports. Using the new gravity model of Anderson-van Wincoop, there is strong evidence of a market expansion effect across knowledge-intensive industries. The overall elasticity of knowledge-intensive imports w.r.t patent rights is 0.28, with considerable variation across industries, being 0.55 for electronics, 0.44 for rubber manufactures, and 0.32 for pharmaceuticals. This increase in imports appears to be (mainly) driven by quantity increases, not just price increases. Our results survive multiple robustness checks. Key Words: Imports, Intellectual property rights, Gravity model, Multilateral resistance JEL Codes: F13, F14, O34

Pages: 39 pages
Date: 2022-09
New Economics Papers: this item is included in nep-int, nep-ipr, nep-knm, nep-tid and nep-ure
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