Intellectual property rights protection and endogenous economic growth

Research output: Journal Publications and Reviews (RGC: 21, 22, 62)21_Publication in refereed journalNot applicablepeer-review

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Original languageEnglish
Pages (from-to)853-873
Journal / PublicationJournal of Economic Dynamics and Control
Volume27
Issue number5
Publication statusPublished - Mar 2003

Abstract

The main purpose of the paper is to examine the impact of intellectual property rights (IPR) protection on economic growth and welfare. To achieve this aim, we make use of an expanding-variety-type R&D-based endogenous growth model. We work out the transitional dynamics of a shock in IPR protection and account fully for the loss in current consumption and gain in consumption growth due to a tightening IPR protection. We find that there exists an optimal degree of IPR protection in our model. We then calibrate our model by US data, and found that under-protection of IPR is much more likely than over-protection. Moreover, in the case of over-protection, the welfare losses are trivial; whereas in the case of under-protection, the welfare losses can be substantial. © 2002 Elsevier Science B.V. All rights reserved.

Research Area(s)

  • Growth, Innovation, Intellectual property rights