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Intellectual Property, Tariffs, and International Trade Dynamics

Federico Mandelman () and Andrea Waddle ()

No 2019-10, FRB Atlanta Working Paper from Federal Reserve Bank of Atlanta

Abstract: The emergence of global value chains not only leads to a magnification of trade in intermediate inputs but also to an extensive technology diffusion among the different production units involved in arms-length relationships. In this context, the lack of enforcement of intellectual property rights has recently become a highly controversial subject of debate in the context of the China-U.S. trade negotiations. This paper analyzes the strategic interaction of tariff policies and the enforcement of intellectual property rights within a quantitative general equilibrium framework. Results indicate that, in principle, tariffs could be an effective deterrent for weak protections for intellectual property. Moreover, weakening enforcement may be a strong deterrent for raising tariffs. These results combined indicate that there is scope for international cooperation on these fronts.

Keywords: tariffs; intellectual property rights; technology capital transfers; international trade (search for similar items in EconPapers)
JEL-codes: F13 F21 F41 F42 F51 (search for similar items in EconPapers)
Date: 2019-05-01
New Economics Papers: this item is included in nep-int and nep-ipr
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DOI: 10.29338/wp2019-10

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