Intellectual Property Rights, Competition, And Economic Growth Of Developing Countries

Intellectual property rights (IPRs) protection has been a hotspot for a country'sinternal and international policies in the globalization of economy and technology. Anappropriate IPRs system is especially important for developing countries to winthrough the technical predicament and promote economic growth. But there is littleresearch on macroeconomics of intellectual property rights protection until now,which is far behind the requirement of economic practice. Because stronger IPRs protection will change the welfare situation of every firmand individual, so there is always distinct divergence from microeconomic perspective.To solve this problem, the macroeconomic analysis of IPRs' growth effect must getthe most attention, especially for developing countries. The main purpose of our research is to examine the impact of intellectualproperty rights protection on economic growth and welfare in developing countries.To achieve this aim, we make use of a few of R&D-based endogenous growth models,which are based on the main character of developing countries' economy, and wemake some policies suggestions for the long-term economic development. The main findings and conclusions of our work are as follows: Cross-country empirical research reveals that there is an inverted-U relationshipbetween patent strength and real per-capital income. National IPRs regimes seemed asan endogenous outcome of economic development in history. But introduction of themultilateral agreement on TRIPs has blurred the boundaries of the national systemand international rulers. Under the pressure of the developed countries, there has beena tendency towards regulatory convergence, which makes us treat IPRs protection asan exogenous variable in our macroeconomic models. In order to understand the mechanisms by which the IPRs system affects theeconomic growth, first we analyzed relationships between IPRs protection, enterprisecompetition and economic growth in a closed economic system. The research inpartial equilibrium framework shows that the optimal patent lifetime is to get thebalance of static efficiency losses and dynamic innovation gains. And the patentprotection prevents the imitative goods to position too close to the original patentgoods, which increases the cost of the imitation. ? iv ?To emphasize the industrial R&D and competition, we choose Schumpeterianendogenous growth theory to analyzise the macroeconomic effect of IPRs. Firstly, we construct a three-stage model with short-term monopoly andendogenous innovations to demonstrate how IPRs protection operations in growthprocess, and we find that IPRs protection always induce distortion, but it can improveproductivity and intertemporal social welfare. Secondly, by using the conclusions of Aghion's endogenous growth models with"step by step" innovation, which shows that a little imitation is almost alwaysgrowth-enhancing, but too much imitation is always growth-reducing, we found thatIPRs can provide appropriate market structure for competition and long run growth. Finally, because one of the important problems that developing countries careabout a lot is, how IPRs strengthening affects the national economic process, so wework out the transitional dynamics of a shock in IPRs protection in anexpanding-variety type R&D-based endogenous growth model. When the governmentannounces an immediate increase in IPRs protection, there is an immediate drop in theentire consumption path and an immediate increase in the rate of growth ofconsumption, as well as overshooting of the rate of innovation. This model illustratesthe tradeoff between current aggregate consumption (static losses) and consumptiongrowth rate (danymic gains) by strengthening IPRs protection, and reveals therelationship between IPRs protection strength and growth rate. Then we extend our work into an open economic system by introducinginternational economic ac...