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

49 Pages Posted: 3 Oct 2016 Last revised: 27 Jun 2021

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)

Chaopeng Wu

Xiamen University - School of Management

Multiple version iconThere are 3 versions of this paper

Date Written: September 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.

Suggested Citation

Fang, Lily H. and Lerner, Josh and Wu, Chaopeng, Intellectual Property Rights Protection, Ownership, and Innovation: Evidence from China (September 2016). NBER Working Paper No. w22685, Available at SSRN: https://ssrn.com/abstract=2846901

Lily H. Fang (Contact Author)

INSEAD - Finance ( email )

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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

Chaopeng Wu

Xiamen University - School of Management ( email )

No.422 Siming Nan Road
Xiamen, Fujian 361005
China

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