Do Stronger Intellectual Property Rights Increase International Technology Transfer? Empirical Evidence from U.S. Firm-Level Data

37 Pages Posted: 14 Sep 2005

See all articles by Lee Branstetter

Lee Branstetter

Carnegie Mellon University - H. John Heinz III School of Public Policy and Management; National Bureau of Economic Research (NBER)

Raymond J. Fisman

National Bureau of Economic Research (NBER); Boston University

C. Fritz Foley

Harvard University - Business School (HBS); National Bureau of Economic Research (NBER)

Date Written: August 2005

Abstract

This paper examines how technology transfer within U.S. multinational firms changes in response to a series of IPR reforms undertaken by 16 countries over the 1982-1999 period. Analysis of detailed firm-level data reveals that royalty payments for technology transferred to affiliates increase at the time of reforms, as do affiliate R&D expenditures and total levels of foreign patent applications. Increases in royalty payments and R&D expenditures are concentrated among affiliates of parent companies that use U.S. patents extensively prior to reform and are therefore expected to value IPR reform most. For this set of affiliates, increases in royalty payments exceed 30 percent. Our results collectively imply that U.S. multinationals respond to changes in IPR regimes abroad by significantly increasing technology transfer to reforming countries.

Suggested Citation

Branstetter, Lee and Fisman, Raymond and Foley, C. Fritz, Do Stronger Intellectual Property Rights Increase International Technology Transfer? Empirical Evidence from U.S. Firm-Level Data (August 2005). NBER Working Paper No. w11516. Available at SSRN: https://ssrn.com/abstract=776004

Lee Branstetter (Contact Author)

Carnegie Mellon University - H. John Heinz III School of Public Policy and Management ( email )

Pittsburgh, PA 15213-3890
United States

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
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Raymond Fisman

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Boston University ( email )

595 Commonwealth Avenue
Boston, MA 02215
United States

C. Fritz Foley

Harvard University - Business School (HBS) ( email )

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Morgan 270C
Boston, MA 02163
United States
617-495-6375 (Phone)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

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