Intellectual Property Rights Protection And Economic Growth In Developing Countries

Endogenous growth theory claims that knowledge accumulation is the crucial source for economic growth. Public goods characteristics of knowledge have made intellectual property rights an even more important resource during the times of knowledge-based economy, and efficient intellectual property rights protection (IPP) is of great importance to technological innovation, international technology transfer and economic growth.The effect of IPP on technological progress and economic growth in less developed countries (LDCs) is a topic for dispute in fields for international economics and international policy negotiation. The effect of implement of agreement on trade-related intellectual property rights (TRIPS) as one of three mainstays of WTO on economic growth in LDCs has been debated intensively in the theoretical and practical fields. Intellectual property rights policy in LDCs under TRIPS has been a critical factor for overcoming the dilemma in technology-choices and promoting long-run economic growth. China is a developing country with unbalanced regional economies, the relationship between IPP and economic growth in different regions is undoubtedly of great practical importance to formulate appropriate and flexible strategies for IPP and to promote harmonious regional growth in China.While most previous studies focused on developed countries (DCs) with more perfect institutional arrangement of IPP, very few studies investigated the effect of IPP on economic growth in LDCs. Viewed from technology supply in LDCs, this dissertation investigates the effect of IPP on technology supply and economic growth in LDCs under the analytical frameworks of endogenous growth theory and north-south trade, and explores the channels through which IPP exerts impacts on economic growth in LDCs. It is shown that technology supply, as determined by international trade, FDI and technology licensing, plays a major role in promoting economic growth in LDCs. Three interesting findings are noted as follows:First, the effect of IPP on import trade and FDI in LDCs has displayed significant industry-specific characteristics. It is also heavily dependent on country-specific characteristics of host country such as economic development stages, imitative ability and market size etc. The effect of IPP on import trade and FDI in China has also demonstrated significant industry-specific characteristics and is also related to imitative ability of different industries. Similar empirical evidences have not appeared in the previous studies.Second, unlike previous studies, this dissertation has proved theoretically and empirically a nonlinear relationship between IPP and economic growth in LDCs; The effect of IPP on economic growth in LDCs depends on economic development stages and has displayed a significant threshold effect. While IPP will exert a positive impact economic growth above the threshold, no statistically significant relation is found between IPP and economic growth below the threshold.Third, the relationship between IPP and economic growth in China is also found nonlinear; Both regional-specific characteristics and the threshold effect exist in the cross-section investigation using cross-province data. The results differ remarkably from the previous studies.These findings have important implications for policy suggestions. Institutional arrangement of and policy design for intellectual property rights protection in developing countries should evolve with domestic economic development stages. The IPP control should intensify with economic growth and development process. It seems meaningful to suggest that in China a more flexible policy toward IPP be followed in less technology-intensive regions and industries.