Multinational Firms and Impacts on Employment, Trade, and Technology: New Perspectives for a New Century

By Robert E. Lipsey; Jean-Louis Mucchielli | Go to book overview

9

THE EFFECTIVENESS OF INTELLECTUAL PROPERTY RIGHTS *

An exploration of French survey data

Emmanuel Combe and Etienne Pfister


9.1.

Introduction

Economic research in the field of patents can broadly be divided into three lines of investigation. In works such as those described by Griliches (1990), patents mainly serve as a measure of inventive activity and technological progress in general - and whether this measure is appropriate or not remains indeed a debate in itself. The second line of research, described in Van Dijk (1994) and Deffains (1997), aims at building an optimal patent system; thus, it focuses on the trade-off between increasing the incentives to innovate (and thus dynamic social efficiency) and maintaining an adequate level of competition in the post-innovation period.

The third line of research is more broad in its scope as it seeks to understand and measure the use and effectiveness of patents in protecting the rents from innovation. Beginning with the early empirical work of Edwin Mansfield (Mansfield et al. 1981; Mansfield 1986), this field of research has grown at a steady pace since the beginning of the 1980s. Theoretical models have focused on the many aspects of patents: how they may modify the incentives to innovate (Gilbert and Newbery 1982), how they may signal significant technological advances and deter further research (Fudenberg et al. 1983) and alternatively, how they may open new avenues of research through disclosure of new scientific discoveries (Choi 1990); how patents are enforced by firms against infringers (Lanjouw and Lerner 1996).

*We are grateful to the French Ministry of Industry (SESSI) for providing us with the data. We also acknowledge the financial support from both 'Programme Les Enjeux de l'Innovation', 5233/66 (CNRS) and 'Programme: La Compétitivité Internationale de l'Industrie Française', 02/1998 (CGP). Finally, we wish to thank Rémy Barré, Bruno Deffains, Jenny Lanjouw, Bruno van Pottelsberghe, Reinhilde Veugelers and other participants at the 1999 Sorbonne conference on multinational firms for their comments on an earlier version.

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