A Political Economic Analysis Of Frictions On Trade-related IPR Protection

It is inevitable that trade frictions are in widely existence with growth of internationaleconomic communication. Trade friction has a significant growth since the 1990s.Frictions in trade-related intellectual property rights (IPR) are increasing with the growingimportance of IPR in international trade. Developed countries have an advantage in IPR,and IPR is important in promoting economic growth. Developed countries strengthen IPRaround the world in order to protect its IPR vested interests, while developing countrieswould hurt their technological innovation and welfare from protection of IPR due to theconfine of economic development. Therefore, trade-related IPR generates and would existfor a long time. It is a major issue widely concerned to coordinate this contradiction andpromote international capital and technology flow.This dissertation first reviews the existing literature. Research on trade frictionscaused by protection of IPR is scattered and could be divided to several parts: research onIPR in the view of macroeconomics, research on trade frictions in the view of politicaleconomy of trade policy, research on frictions of IPR in the view of International Law. Thecurrent research is partial and lacking of system analysis, which provides a uniqueperspective in this paper.Based on current literature, this dissertation systematically studies the induced regimeof trade frictions on IPR in the view of interest groups. Interest groups could affect publicpolicy by direct and indirect lobbing. Two kinds of induced regimes are formulated owingto active protection of IPR in the interference of interest groups in developed countries.One is regulation-level regime of trade frictions on IPR, in which regulation represents asmultilateral or bilateral agreement; the other is product-level regime of trade frictions onIPR, which represents as dispute on products. These two regimes could neatly interpretdifferent kinds of trade frictions on IPR.Based on the analysis of induced regime of trade frictions on IPR, this dissertationtries to explain theoretically the policy-making process of IPR protection. Protection forSale Model suggests that industrial protection level in fixed structural parameter dependson industrial import penetration ratio, industrial elasticity of imports and the effectivenessof the industry to organize into interest groups. Public policy is the outcome of interactgame between the government and interest groups. Based on Protection for Sale Model, we further assume that an invisible input, IPR, is necessary to produce goods besidesgeneral input, and discuss how protection policy of IPR is made concerning both politicalcontribution and social welfare. We find that the protection ratio of common industry isinfluenced by the ratio of IPR industry, whereas the latter is independent from the former.The dissertation analyzes IPR protection in developing countries under TRIPS. Inview of the core status of TRIPS, developing countries should abide by the basicobligations under TRIPS, and participate in improving and perfecting internationalagreements. Then we extend case analysis to 337 investigations between China andAmerica in order to test the trade friction theory. Case analysis demonstrates that Chinamust pay more attentions to product-level trade frictions on IPR protection.