Does Intellectual Property Protection Spur Technological Change?

Robert E. Evenson · Sunil Kanwar · Robert Evenson

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Intellectual Property and Patents Intellectual Property Law Economic Growth and Productivity

Abstract

Of the diverse factors motivating technological change, one factor that has received increasing attention in the recent past has been the protection of intellectual property rights. Given fairly recent changes in the international policy ethos where a regime of stronger intellectual property protection has become a fait accompli for most developing countries, it is of some significance to ask whether more stringent protection of intellectual property does indeed encourage innovation. And this is the question which this paper examines, utilising crosscountry panel data on R&D investment, patent protection and other country-specific characteristics spanning the period 1981-1990. The evidence unambiguously indicates the significance of intellectual property rights as incentives for spurring innovation. JEL Classification: O34, O31 Keywords: Intellectual Property Rights, Technological Change, Economic Growth 2 Does Intellectual Property Protection spur Technological Change? Sunil Kanwar and Robert Evenson A distinctive characteristic of modern economic growth has been the significant role played by technological change. Of the diverse factors motivating technological change, one factor that has received increasing attention in the recent past has been the role of intellectual property protection. Given the shift in the ownership distribution of innovations away from individuals and towards large corporations in `recent decades' 1 , intellectual property protection has arguably become an even more important stimulus than hitherto; for such protection augments both the means and the incentive to undertake expensive innovation. While there has been an on-going debate on whether strong(er) intellectual property protection encourages or retards the rate of technological cha...

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References

1990Endogenous Technological Change 1987Appropriating the Returns from Industrial Research and Development 1995Growth Empirics: A Panel Data Approach 1990Industrial market structure and economic performance 1982Market Structure and Innovation.1982Preemptive Patenting and the Persistence of Monopoly 1997Determinants of patent rights: A cross-national study 1996The role of intellectual property rights in economic growth

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