Strategic Model of Intellectual Property Protection Across Nations (original) (raw)
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A Strategic Model of Intellectual Property Protection Across Nations
2005
In a two-country framework we study the strategic interacation between the governments regarding the choice of optimal patent policies and show that there always exist patent agreements that increase the welfare of each country. We then examine whether, in an optimal agreement, patent protection within each country will be discriminatory or uniform. On the assumption that countries are identical, we have shown that if cross-border imitation is perfect, the maximum welfare attainable under either regime is exactly equal. The positive marginal social gain from a uniformity clause arises only when imitation is imperfect.
Trade and the Globalisation of Patent Rights
SSRN Electronic Journal, 2000
This paper examines the role of patent policy in the open economy. It begins by considering how the presence of patents affects trade in patentable products. A brief review of the general argument for patent protection is followed by consideration of the elements that comprise a patent system, and which determine "patent strength". Attention is then given to how the existence of the global market influences countries' choices of patent system. It is noted that the way patents are applied tends to push countries towards extreme choices, which may partly explain the pressure for some degree of international harmonisation that led to the minimum standards specified in the TRIPs Agreement. But even with these minimum standards, countries retain discretion over important aspects of their patent systems.
2005
Patents are probabilistic rights. We set up a multi-stage model in which choosing between patent and trade secrecy is a¤ected by three parameters: the patent strength de ned as the probability that the right is upheld by the court, the cost of imitating a patented innovation relative to the cost of imitating a secret innovation, and the innovation size de ned as the extent of the cost reduction. The choice of the protection regime is the result of two e¤ects: the damage e¤ect evaluated under the unjust enrichment doctrine and the e¤ect of market competition that occurs under the shadow of infringement. We nd that large innovations are likely to be kept secret whereas small innovations are always patented. Furthermore, medium innovations are patented only when patent strength is su ¢ ciently high. Finally, we investigate a class of patent licensing agreements used to settle patent disputes between patent holders and their competitors.
Patent protection in developing countries and global welfare: WTO obligations versus flexibilities
Journal of International Economics
This paper develops a North-South model to evaluate the South's incentive for patent protection when a Northern firm's investment in quality-enhancing research and development (R&D) is affected by its patent policy. The model is used to (a) evaluate the impact of requiring the South to fulfill its key WTO obligation of instituting patent protection and (b) to address the role of two major flexibilities that WTO members enjoy with respect to their patent policies: the freedom to implement exhaustion policies of their choosing and the right to use compulsory licensing (CL) subject to certain stipulations. Two forces drive the model: how much the firm invests in R&D and whether or not selling in the South maximizes its global profit. CL improves consumer access in the South and can even raise innovation and global welfare. Provided the South implements patent protection, innovation and welfare are higher if the North follows national as opposed to international exhaustion. However, the South's incentive for patent protection is not necessarily stronger under national exhaustion. Not only is CL more likely to be used under international exhaustion, the welfare gain resulting from its application is also higher relative to that under national exhaustion.
The Growth Effects of National Patent Policies*
Review of international economics, 2008
We construct a two-country (innovative North and imitating South) model of product-cycle trade, fully endogenous Schumpeterian growth, and national patent policies. A move towards harmonization based on stronger Southern intellectual property rights (IPR) protection accelerates the long-run global rates of innovation and growth, reduces the North-South wage gap, and has an ambiguous effect on the rate of international technology transfer. Patent harmonization constitutes a suboptimal global-growth policy. However, if the global economy is governed by a common patent policy regime, then stronger global IPR protection: (a) increases the rates of global innovation and growth; (b) accelerates the rate of international technology transfer; and (c) has no impact on the North-South wage gap.
2014
ABSTRACT. – Patents are probabilistic rights. We set up a multi-stage model in which choosing between patent and trade secrecy is affected by three parameters: the patent strength defined as the probability that the right is upheld by the court, the cost of imitating a patented innovation relative to the cost of imitating a secret innovation, and the innovation size defined as the magnitude of the cost reduction. The choice of the protection regime is the result of two effects: the damage effect evaluated under the unjust enrichment doctrine and the effect of market competition that occurs under the shadow of infringement. We find that large innovations are likely to be kept secret whereas small innovations are always patented. Furthermore, medium innovations are patented only when patent strength is sufficiently high. Finally, we investigate a class of patent licensing agreements used to settle patent disputes between patent holders and their competitors. Choix de la protection int...
Determinants of patent rights: A cross-national study
Research Policy, 1997
This paper presents an index of patent rights for 110 countries for the period . The index is used to examine what factors or characteristics of economies determine how strongly patent rights will be protected. The evidence does indicate that more developed economies tend to provide stronger protection. But the underlying factors which influence patent protection levels are the country's level of research and development (R&D) activity, market environment, and international integration, which are correlated with its level of development. The results qualify, however, that R&D activity influences patent .protection levels after a nation's research sector reaches a critical size. An implication of this is that to raise patent protection levels in weakly protecting countries, it is important to foster a significant research base in those countries and thereby create incentives for protecting patent rights. © 1997 Elsevier Science B.V. how strongly a country will provide patent protection. The paper asks, for example, whether richer countries provide stronger protection, whether countries provide stronger protection as they develop, and whether such rights are better protected in democracies, freer markets, educated societies, in countries exposed to international trade, or in regions with higher levels of innovative activity. In addition to quantifying the levels of patent protection across countries and investigating their determinants, this study has significance for a variety of applications. The index can be used to investigate the impact of patent rights on innovation, trade, direct foreign investment, and technology diffusion, 0048-7333/97/$17.00
Harmonisation or Differentiation in Intellectual Property Protection? The Lessons of History
Prometheus, 2005
Developing countries find themselves pressured to harmonise their intellectual property (IP) standards so that they match those of the United States, Europe and Japan. This article provides historical evidence to support the authors’ claim that when developed countries demand that the rest of the world adopt their current IP regulations, developed countries are preventing other countries from adopting appropriate patent and copyright standards for their levels of development. Developed countries thereby deny a freedom to others that they themselves enjoyed when they were developing.