Intellectual Property Rights Protection, Ownership, and Innovation: Evidence from China

52 Pages Posted: 1 Aug 2015 Last revised: 7 Oct 2016

See all articles by Lily H. Fang

Lily H. Fang

INSEAD - Finance

Josh Lerner

Harvard Business School - Finance Unit; Harvard University - Entrepreneurial Management Unit; National Bureau of Economic Research (NBER)

Wu Chaopeng

Xiamen University - School of Management

Multiple version iconThere are 2 versions of this paper

Date Written: October 5, 2016

Abstract

Using a difference-in-difference approach, we study how intellectual property right (IPR) protection affects innovation in China in the years around the privatizations of state-owned enterprises (SOEs). Innovation increases after SOE privatizations, and this increase is larger in cities with strong IPR protection. Our results support theoretical arguments that IPR protection strengthens firms’ incentives to innovate and that private sector firms are more sensitive to IPR protection than SOEs.

Keywords: Patents, Legal Institutions, Development

JEL Classification: O31, O34, O38

Suggested Citation

Fang, Lily H. and Lerner, Josh and Chaopeng, Wu, Intellectual Property Rights Protection, Ownership, and Innovation: Evidence from China (October 5, 2016). INSEAD Working Paper No. 2016/68/FIN. Available at SSRN: https://ssrn.com/abstract=2638160 or http://dx.doi.org/10.2139/ssrn.2638160

Lily H. Fang (Contact Author)

INSEAD - Finance ( email )

Boulevard de Constance
F-77305 Fontainebleau Cedex
France

Josh Lerner

Harvard Business School - Finance Unit ( email )

Boston, MA 02163
United States
617-495-6065 (Phone)
617-496-7357 (Fax)

HOME PAGE: http://www.people.hbs.edu/jlerner/

Harvard University - Entrepreneurial Management Unit

Cambridge, MA 02163
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Wu Chaopeng

Xiamen University - School of Management ( email )

No.422 Siming Nan Road
Xiamen, Fujian 361005
China

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