Document Type

Working Paper

Publication Date


Working Paper Number

WP #04026, October 2004; Old working paper #12206


We develop a model with one innovating northern firm and several heterogeneous Southern firms that compete in a final product market. We assume the southern firms differ in their ability to adapt technology and use this heterogeneity to study the differing incentives of southern governments to protect intellectual property rights. We find that governments representing more efficient firms have greater incentive to protect IPR than do those representing less efficient firms. However, efficiency considerations imply that, given policies resulting in the same overall innovation rate, it would be better to have weaker IPR protection for the more efficient southern firms.

JEL Classification

F13, O34

File Format



24 pages

Included in

Economics Commons