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Intellectual Property Rights, Foreign Direct Investment and Economic Freedom

Author

Listed:
  • Antonio Saravia

    (Mercer University, Macon GA, USA)

  • Gustavo J. Canavire-Bacarreza

    (School of Economics and Finance, Universidad EAFIT, Medellin, Colombia)

  • Fernando Rios-Avila

    (Levy Economics Institute of Bard College, Annandale-on-Hudson NY, USA)

Abstract

The relationship between intellectual property rights (IPR) protection and foreign direct investment (FDI) continues to pose a challenging puzzle. While several studies have found that these two variables are positively correlated, others have not been able to find conclusive results. We contend that a partial explanation resides on institutional differences among host countries. We find that increases in IPR protection encourage FDI in countries in which the institutional environment, as proxied by indices of economic freedom, is efficient but not otherwise. We use threshold regression techniques on samples ranging from 81 to 102 countries during the 1990 - 2010 period.

Suggested Citation

  • Antonio Saravia & Gustavo J. Canavire-Bacarreza & Fernando Rios-Avila, 2017. "Intellectual Property Rights, Foreign Direct Investment and Economic Freedom," Global Economy Journal (GEJ), World Scientific Publishing Co. Pte. Ltd., vol. 17(2), pages 1-13, June.
    • Handle: RePEc:wsi:gejxxx:v:17:y:2017:i:02:n:gej-2017-0017
    DOI: 10.1142/GEJ-2017-0017
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    References listed on IDEAS

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    Cited by:

    1. Gustavo Canavire-Bacarreza & Luis Castro Peñarrieta, 2017. "Can IPR Affect MNE’s Entry Modes? The Chilean Case," Documentos de Trabajo de Valor Público 15808, Universidad EAFIT.
    2. Gustavo Canavire-Bacarreza & Luis Castro Peñarrieta, 2021. "Can licensing induce productivity? Exploring the IPR effect," Empirical Economics, Springer, vol. 61(2), pages 549-586, August.

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    More about this item

    Keywords

    intellectual property rights; foreign direct investment; institutions; economic freedom;
    All these keywords.

    JEL classification:

    • F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • 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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