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Intellectual property rights protection and export product quality: Evidence from China

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  • Dong, Baomin
  • Guo, Yibei
  • Hu, Xiaotian

Abstract

Intellectual property rights protection (IPP) at destination countries is an important determinant of exports, a result shown by the existing literature. This paper empirically examines the effect of the degree of IPP on export product quality at the origins, using firm-product level data from Chinese exporters and city-level statistics of IPP. To establish the causal relationship, we employ an instrumental variable (IV) approach. Our panel regression results from 2008 to 2013 show that the de facto IPP contributes to the export product quality upgrading and the result is robust against variations of IPP measures, IVs, and different combinations of control variables such as the firm and industry level subsidies. Our heterogeneity results indicate that the betterment of IPP favors less capital-intensive firms; foreign-owned firms relative to domestic-owned firms; and firms in innovation-intensive industries. The effect of IPP on export product quality is statistically insignificant in certain geographic regions (i.e., central and western regions) and trade mode (i.e., processing trade). In addition, we show that the channels through which IPP takes effect on product quality include strengthened R&D input, new product development, and mitigated financial constraints.

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  • Dong, Baomin & Guo, Yibei & Hu, Xiaotian, 2022. "Intellectual property rights protection and export product quality: Evidence from China," International Review of Economics & Finance, Elsevier, vol. 77(C), pages 143-158.
    • Handle: RePEc:eee:reveco:v:77:y:2022:i:c:p:143-158
    DOI: 10.1016/j.iref.2021.09.006
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    4. Gnangnon, Sèna Kimm, 2022. "Effect of Intellectual Property Rights Protection on Services Export Diversification," EconStor Preprints 248717, ZBW - Leibniz Information Centre for Economics.
    5. Yan, Xiaolei & He, Taiyi & Qian, Pengcheng & Liu, Zhongwen, 2024. "Does the construction of Pilot Free Trade Zones promote the development of green economy? - A quasi-natural experiment evidence from China," Economic Analysis and Policy, Elsevier, vol. 81(C), pages 208-224.
    6. Ye Zhu & Minggui Sun, 2022. "The Enabling Effect of Intellectual Property Strategy on Total Factor Productivity of Enterprises: Evidence from China’s Intellectual Property Model Cities," Sustainability, MDPI, vol. 15(1), pages 1-19, December.
    7. Jinqiu Li & Yuyou Zou & Mingqiu Li, 2022. "Synergetic evolution of the regional intellectual property management systems in China based on logistic model," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 43(8), pages 3736-3750, December.
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    More about this item

    Keywords

    Intellectual property protection; Export product quality; Firm heterogeneity;
    All these keywords.

    JEL classification:

    • D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • O34 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital

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