Trademark Protection and International Firms

Laura Alfaro, Cathy Ge Bao, Maggie Chen, Junjie Hong and Claudia Steinwender

No 29721, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We examine how trademark protection—a prevalent but underexplored intellectual property right—affects international firms and market outcomes in an emerging economy. Exploiting the unexpected introduction of China’s 1923 Trademark Law and digitized microdata from Shanghai linking firms, workers, intermediaries, trade, and prices, we show that stronger protection reduced information frictions: private anti-counterfeiting efforts fell, authentic foreign firms expanded, and imitation-prone firms contracted. By lowering brand-dilution risk, the reform deepened foreign integration with Chinese intermediaries. Increased entry and heterogeneous price responses indicate improved market efficiency rather than increased market power, distinguishing trademarks from patents and copyrights.

JEL-codes: D2 F2 N4 O1 O3 (search for similar items in EconPapers)
Date: 2022-02
New Economics Papers: this item is included in nep-cna, nep-his and nep-ipr
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