Has the Shift to Stronger Intellectual Property Rights Promoted Technology Transfer, FDI, and Industrial Development?
This article reviews recent research conducted by the authors that finds that intellectual property right reform increases technology transfers, foreign direct investment inflows, and industrial development. It also places the findings of this work in the broader context of the literature. Has the global shift to stronger intellectual property rights been associated with positive effects? Even today, more than fifteen years after the ratification of the TRIPs Agreement, opinions about the impact of stronger IPR are varied and continue to reflect issues that arose when TRIPs was debated. Opponents of strong IPR typically raise concerns that stronger IPR raises the costs of protected goods and reduces the accessibility of innovations. Proponents suggest that IPR protection fosters innovation in reforming countries. Proponents also argue that stronger IPR facilitates transfers of technology to reforming countries, increases foreign direct investment (FDI), and spurs industrial development. This essay reviews recent research performed by the authors on the effects related to technology transfers, FDI, and industrial development, and it places the findings of this work in the broader context of the literature. Before turning to the effects of stronger IPR on technology transfer, FDI, and industrial development, it is useful to review some findings about other effects that have been discussed and examined. Many representatives of developing country governments argue that stronger IPR has worked against the interests of developing countries. The reasons for this negative view of