Intellectual Property Rights Adoption in Developing Countries

Emmanuelle Auriol and Sara Biancini

No 09-094, TSE Working Papers from Toulouse School of Economics (TSE)

Abstract: This paper studies the incentives that developing countries have to enforce intellectual properties rights (IPR). On the one hand, free-riding on rich countries technology reduces the investment cost in R&D. On the other hand, it yields apotential indirect cost: a firm that violates IPR cannot legally export in a country that enforces them. IPR act like a barrier to entry of the advanced economy markets. Moreover free-riders cannot prevent other to copy their own innovation. The analysis, which distinguishes between large and small developing countries, predicts that small ones should be willing to respect IPR if they want to export and access advanced economies markets, while large emerging countries, such as China and India, will be more reluctant to do so as their huge domestic markets develop. Global welfare is higher under the full protection regime if the developing country does not innovate. It is higher under a partial regime if both countries have access to similar R&D technology and the developing country market is large enough.

JEL-codes: F12 F13 F15 L13 O31 O34 (search for similar items in EconPapers)
Date: 2009-10
New Economics Papers: this item is included in nep-cwa, nep-ino, nep-ipr and nep-pr~
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:tse:wpaper:22270

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