Intellectual Property Enforcement, Exports and Productivity: Evidence from China

45 Pages Posted: 6 Dec 2018

See all articles by Huiwen Lai

Huiwen Lai

Hong Kong Polytechnic University

Keith E. Maskus

University of Colorado at Boulder - Department of Economics; CESifo (Center for Economic Studies and Ifo Institute)

Lei Yang

Hong Kong Polytechnic University

Date Written: July 2018

Abstract

We study how provincial-level enforcement of intellectual property rights (IPRs) affects Chinese firms’ decisions regarding exit, export, and the channels through which to receive technology transfer. Our findings provide insights into how variations in IPRs enforcement alter productivity. Our model combines the standard theory of heterogeneous firms with the endogenous choices of those firms concerning how they absorb international technologies through imitation or licensing. We show that, in this setting, the exit and export cutoff productivities differ from those in the standard environment, leading to a different sorting mechanism. We also predict that stronger IPRs change the decisions firms make concerning their mode of technology transfer, further altering their productivity and export possibilities. Empirical tests based on a comprehensive dataset of Chinese firms from 2000 to 2006 support the model predictions.

Keywords: Intellectual Property Enforcement, Exports, Firm Heterogeneity

JEL Classification: D23, F13, F14, O34

Suggested Citation

Lai, Huiwen and Maskus, Keith E. and Yang, Lei, Intellectual Property Enforcement, Exports and Productivity: Evidence from China (July 2018). Robert Schuman Centre for Advanced Studies Research Paper No. RSCAS 2018/39, Available at SSRN: https://ssrn.com/abstract=3293845 or http://dx.doi.org/10.2139/ssrn.3293845

Huiwen Lai (Contact Author)

Hong Kong Polytechnic University ( email )

Hung Hom, Kowloon
Hong Kong

Keith E. Maskus

University of Colorado at Boulder - Department of Economics ( email )

Campus Box 256
Boulder, CO 80309
United States
303-492-7588 (Phone)
303-492-8960 (Fax)

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

Lei Yang

Hong Kong Polytechnic University ( email )

Hung Hom, Kowloon
Hong Kong
(852)34003457 (Phone)

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