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The Linder Hypothesis and Trade of Intellectual Property Services

Author

Listed:
  • Kristie Briggs

    (Creighton University)

  • Margaret Knight

    (Creighton University)

  • Desarae Mueller-Fichepain

    (Creighton University)

Abstract

Countries can purchase the right to use intellectual property (IP) owned by entities abroad. When this occurs, the country purchasing the right to use foreign-owned IP is characterized as importing IP services, while the country from which the IP originates is characterized as exporting IP services. This research examines if the Linder hypothesis that countries of similar income levels trade more holds true for trade of IP services. The results for a sample of all trade partners confirm that the Linder hypothesis holds. However, when limiting the sample to low- and middle-income importing countries, income differences between trade partners no longer has a statistically significant impact on IP services trade. Instead, for these countries, the strength of IP protection plays a more impactful role.

Suggested Citation

  • Kristie Briggs & Margaret Knight & Desarae Mueller-Fichepain, 2021. "The Linder Hypothesis and Trade of Intellectual Property Services," Journal of Economic Insight, Missouri Valley Economic Association, vol. 47(2), pages 27-52.
    • Handle: RePEc:mve:journl:v:47:y:2021:2:1:p:27-42
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    More about this item

    JEL classification:

    • O34 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Intellectual Property and Intellectual Capital
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General

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