Patent Laws, Product Life-Cycle Lengths, and Multinational Activity

• 成果类型: Article
• 署名作者: Bilir, L. Kamran
• 署名单位: University of Wisconsin System; University of Wisconsin Madison
• 刊物名称: AMERICAN ECONOMIC REVIEW
• ISSN/ISSBN: 0002-8282
• DOI: 10.1257/aer.104.7.1979
• 发表日期: 2014
• 页码: 1979-2013
• 关键词: intellectual property-rights; INTERNATIONAL TECHNOLOGY-TRANSFER; foreign direct-investment; INNOVATION; PROTECTION; TRADE; FIRMS; KNOWLEDGE; QUALITY; GROWTH

摘要

Do intellectual property rights influence multinationals' manufacturing location decisions? My theoretical model indicates that countries with strong patent laws attract multinational activity, but only in sectors with relatively long product life cycles. By contrast, firms with short life-cycle technologies are insensitive, because offshore imitation is less likely to succeed before obsolescence. I document strong empirical regularities consistent with the model using a panel dataset on the global operations of US-based multinational firms and a new measure of product obsolescence. Moreover, my identification strategy allows me to isolate the causal effect of patent laws on multinational activity.