Bilateral intra-industry trade flows and intellectual property rights protection: first empirical evidence

Abstract

This study provides the first empirical evidence on the effects of intellectual property rights (IPRs) protection on bilateral intra-industry trade (IIT) flows. The empirical investigation is based on pooled South African data and takes advantage of the theoretical distinction between horizontal and vertical IIT. A gravity equation of international trade is estimated in the context of fixed and random effects models. The principal findings suggest that IPRs and imitation abilities separately are not important factors in determining IIT flows. However, the interaction between them is important.

Do Intellectual Property Rights Matter to Taiwan's Exports? A Dynamic Panel Approach

“…Her panel study finds that IPR protection has no significant impact on R&D‐intensive goods, a result similar to that found by Fink and Primo‐Braga (2005) for high‐tech trade. Al‐Mawali (2005) provide evidence on the effect of IPR protection on bilateral intra‐industry trade flow rather than one‐way trade. The findings suggest that IPR and imitation abilities separately are not important factors in determining intra‐industry trade flow, but the interaction between them is important.…”

“…This result supports the market expansion effect from the dynamic standpoint and it provides new insight into the dynamic relation between IPR and trade, because previous panel studies have found that IPR protection has no discernible impact on trade (e.g. Co, 2004; Al‐Mawali, 2005; Yang and Woo, 2006).…”

“…Indeed, the protection of IPR is inherently a dynamic process, involving both a secular evolution within one country over time and the need for new standards of protection (Maskus, 1998). However, previous empirical studies, except for Co (2004), Al‐Mawali (2005), Falvey et al. (2006) and Yang and Woo (2006), use only cross‐sectional and pre‐1990 data.…”

Bilateral intra-industry trade flows and intellectual property rights protections: further evidence from the United Kingdom

“…Despite the growing importance of IIT, very few studies have attempted to investigate the effects of IPRs on IIT empirically. Al-Mawali (2005) was the first to examine the effects of IPRs on bilateral IIT flows, using data from South Africa and its trading partners. The results show that the total IIT in South Africa does not depend on partners' IPRs protection levels, but rather on the interaction between the partners' IPRs strength and their imitative capabilities.…”

Has Special 301 Promoted US Manufacturing Exports?

“…Frankel et al. (1997), Anderson and van Wincoop (2003), Al‐Mawali (2005), Kucera and Sarna (2006), and Egger (2005) are important examples. Smith (1999) and Co (2004) specifically address IPR protection within a gravity model framework.…”