Universal Intellectual Property Rights: Too Much of a Good Thing?

Résumé

Developing countries' incentives to protect intellectual property rights (IPR) are studied in a model of vertical innovation. Enforcing IPR boosts export opportunities to advanced economies but slows down technological transfers and incentives to invest in R&D. Asymmetric protection of IPR, strict in the North and lax in the South, leads in many cases to a higher world level of innovation than universal enforcement. IPR enforcement is U-shaped in the relative size of the export market compared to the domestic one: rich countries and small/poor countries enforce IPR, the former to protect their innovations, the latter to access foreign markets, while large emerging countries free-ride on rich countries' technology to serve their internal demand.

Mots-clés

Intellectual Property Rights; Innovation; Imitation; Duopoly; Developing Countries;

Codes JEL

F12: Models of Trade with Imperfect Competition and Scale Economies • Fragmentation
F13: Trade Policy • International Trade Organizations
F15: Economic Integration
L13: Oligopoly and Other Imperfect Markets
O31: Innovation and Invention: Processes and Incentives
O34: Intellectual Property and Intellectual Capital