Coordination of Trade and Intellectual Property Rights Policies

TE CHENG Lu, JIN LI Hu, Yan Shu Lin*

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

Abstract

We employ a bilateral R&D spillover model to analyze how a domestic government coordinates its intellectual property rights (IPR) and trade policies and hence affects a foreign firm's choice between export (EX) and foreign direct investment (FDI). We find that both firms' profits increase with IPR protection if the IPR protection level in the domestic country is loose. The domestic country can coordinate trade and IPR policies and reach a high welfare level by affecting foreign firm's entry decisions. The profitability and desirability may decrease with the strength of IPR protection and correspond to a welfare-reducing R&D.

Original languageEnglish
JournalSingapore Economic Review
DOIs
StateAccepted/In press - 2020

Keywords

  • entry mode
  • Intellectual property rights
  • R&D spillover
  • tariff

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