IDEAS home Printed from https://ideas.repec.org/p/ssa/lemwps/2016-28.html
   My bibliography  Save this paper

Do Intellectual Property Rights Influence Cross-Border Mergers and Acquisitions ?

Author

Listed:
  • Mercedes Campi
  • Marco Duenas
  • Matteo Barigozzi
  • Giorgio Fagiolo

Abstract

This paper analyses whether the strengthening of intellectual property rights (IPRs) systems affects decisions of cross-border mergers and acquisitions (M&As), and whether their influence is different for developed and developing countries and across industrial sectors. We estimate an extended gravity model to study bilateral flows of M&As using data for the post-TRIPS period (1995-2010) and two different indexes that measure the strength of IPRs systems at the country level. We find that IPRs influence decisions of cross-border M&As and facilitate the creation of investment linkages. However, we detect a heterogeneous impact of IPRs on M&As depending on specificities of countries and sectors.

Suggested Citation

  • Mercedes Campi & Marco Duenas & Matteo Barigozzi & Giorgio Fagiolo, 2016. "Do Intellectual Property Rights Influence Cross-Border Mergers and Acquisitions ?," LEM Papers Series 2016/28, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    • Handle: RePEc:ssa:lemwps:2016/28
    as

    Download full text from publisher

    File URL: http://www.lem.sssup.it/WPLem/files/2016-28.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Robert C. Feenstra & Robert Inklaar & Marcel P. Timmer, 2015. "The Next Generation of the Penn World Table," American Economic Review, American Economic Association, vol. 105(10), pages 3150-3182, October.
    2. Guifang Yang & Keith Maskus, 2001. "Intellectual property rights and licensing: An econometric investigation," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 137(1), pages 58-79, March.
    3. Robert C. Feenstra, 1998. "Integration of Trade and Disintegration of Production in the Global Economy," Journal of Economic Perspectives, American Economic Association, vol. 12(4), pages 31-50, Fall.
    4. Alfredo Cuevas & Miguel Messmacher & Alejandro Werner, 2005. "Foreign Direct Investment in Mexico since the Approval of," The World Bank Economic Review, World Bank, vol. 19(3), pages 473-488.
    5. Bruce A. Blonigen, 2019. "Firm-Specific Assets and the Link Between Exchange Rates and Foreign Direct Investment," World Scientific Book Chapters, in: Foreign Direct Investment, chapter 3, pages 89-120, World Scientific Publishing Co. Pte. Ltd..
    6. Maskus, Keith E. & Penubarti, Mohan, 1995. "How trade-related are intellectual property rights?," Journal of International Economics, Elsevier, vol. 39(3-4), pages 227-248, November.
    7. Richard Baldwin & James Harrigan, 2011. "Zeros, Quality, and Space: Trade Theory and Trade Evidence," American Economic Journal: Microeconomics, American Economic Association, vol. 3(2), pages 60-88, May.
    8. Richard Baldwin & Daria Taglioni, 2006. "Gravity for Dummies and Dummies for Gravity Equations," NBER Working Papers 12516, National Bureau of Economic Research, Inc.
    9. Michael W Nicholson, 2007. "The Impact of Industry Characteristics and IPR Policy on Foreign Direct Investment," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 143(1), pages 27-54, April.
    10. Mansfield, E., 1995. "Intellectual Property Protection, Direct Investment, and technology Transfer, Germany, Japan, and the United States," Papers 27, World Bank - International Finance Corporation.
    11. Keith E. Maskus, 2012. "Private Rights and Public Problems: The Global Economics of Intellectual Property in the 21st Century," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 5072, April.
    12. Campi, Mercedes & Dueñas, Marco, 2016. "Intellectual Property Rights and International Trade of Agricultural Products," World Development, Elsevier, vol. 80(C), pages 1-18.
    13. Elhanan Helpman, 2006. "Trade, FDI, and the Organization of Firms," Journal of Economic Literature, American Economic Association, vol. 44(3), pages 589-630, September.
    14. Campi, Mercedes & Nuvolari, Alessandro, 2015. "Intellectual property protection in plant varieties: A worldwide index (1961–2011)," Research Policy, Elsevier, vol. 44(4), pages 951-964.
    15. Jung Hur & Rasyad A. Parinduri & Yohanes E. Riyanto, 2011. "Cross‐Border M&A Inflows And Quality Of Country Governance: Developing Versus Developed Countries," Pacific Economic Review, Wiley Blackwell, vol. 16(5), pages 638-655, December.
    16. Peter Nunnenkamp & Julius Spatz, 2004. "Intellectual property rights and foreign direct investment: A disaggregated analysis," Review of World Economics (Weltwirtschaftliches Archiv), Springer;Institut für Weltwirtschaft (Kiel Institute for the World Economy), vol. 140(3), pages 393-414, September.
    17. James E. Anderson, 2011. "The Gravity Model," Annual Review of Economics, Annual Reviews, vol. 3(1), pages 133-160, September.
    18. di Giovanni, Julian, 2005. "What drives capital flows? The case of cross-border M&A activity and financial deepening," Journal of International Economics, Elsevier, vol. 65(1), pages 127-149, January.
    19. Park, Walter G., 2008. "International patent protection: 1960-2005," Research Policy, Elsevier, vol. 37(4), pages 761-766, May.
    20. Keith E. Maskus, 2000. "Intellectual Property Rights in the Global Economy," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 99, April.
    21. Lee G. Branstetter & Raymond Fisman & C. Fritz Foley, 2006. "Do Stronger Intellectual Property Rights Increase International Technology Transfer? Empirical Evidence from U. S. Firm-Level Panel Data," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 121(1), pages 321-349.
    22. Rossi, Stefano & Volpin, Paolo F., 2004. "Cross-country determinants of mergers and acquisitions," Journal of Financial Economics, Elsevier, vol. 74(2), pages 277-304, November.
    23. Nils Herger & Christos Kotsogiannis & Steve McCorriston, 2008. "Cross-border acquisitions in the global food sector," European Review of Agricultural Economics, Oxford University Press and the European Agricultural and Applied Economics Publications Foundation, vol. 35(4), pages 563-587, December.
    24. Pavitt, Keith, 1984. "Sectoral patterns of technical change: Towards a taxonomy and a theory," Research Policy, Elsevier, vol. 13(6), pages 343-373, December.
    25. Ginarte, Juan C. & Park, Walter G., 1997. "Determinants of patent rights: A cross-national study," Research Policy, Elsevier, vol. 26(3), pages 283-301, October.
    26. van Bergeijk,Peter A. G. & Brakman,Steven (ed.), 2010. "The Gravity Model in International Trade," Cambridge Books, Cambridge University Press, number 9780521196154, September.
    27. Bruce Blonigen, 2005. "A Review of the Empirical Literature on FDI Determinants," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 33(4), pages 383-403, December.
    28. Wesley M. Cohen & Richard R. Nelson & John P. Walsh, 2000. "Protecting Their Intellectual Assets: Appropriability Conditions and Why U.S. Manufacturing Firms Patent (or Not)," NBER Working Papers 7552, National Bureau of Economic Research, Inc.
    29. Carsten Fink & Keith E. Maskus, 2005. "Intellectual Property and Development : Lessons from Recent Economic Research," World Bank Publications - Books, The World Bank Group, number 7443.
    30. J. M. C. Santos Silva & Silvana Tenreyro, 2006. "The Log of Gravity," The Review of Economics and Statistics, MIT Press, vol. 88(4), pages 641-658, November.
    31. Mercedes Delgado & Margaret Kyle & Anita M. McGahan, 2013. "Intellectual Property Protection and the Geography of Trade," Journal of Industrial Economics, Wiley Blackwell, vol. 61(3), pages 733-762, September.
    32. Hea‐Jung Hyun & Hyuk Hwang Kim, 2010. "The Determinants of Cross‐border M&As: The Role of Institutions and Financial Development in the Gravity Model," The World Economy, Wiley Blackwell, vol. 33(2), pages 292-310, February.
    33. Sanjaya Lall, 2000. "The Technological Structure and Performance of Developing Country Manufactured Exports, 1985-98," Oxford Development Studies, Taylor & Francis Journals, vol. 28(3), pages 337-369.
    34. Wong, Wei-Kang, 2008. "Comparing the fit of the gravity model for different cross-border flows," Economics Letters, Elsevier, vol. 99(3), pages 474-477, June.
    35. Smith, Pamela J., 2001. "How do foreign patent rights affect U.S. exports, affiliate sales, and licenses?," Journal of International Economics, Elsevier, vol. 55(2), pages 411-439, December.
    36. Thomas Hatzichronoglou, 1997. "Revision of the High-Technology Sector and Product Classification," OECD Science, Technology and Industry Working Papers 1997/2, OECD Publishing.
    37. Ivus, Olena, 2010. "Do stronger patent rights raise high-tech exports to the developing world?," Journal of International Economics, Elsevier, vol. 81(1), pages 38-47, May.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Mercedes Campi & Marco Dueñas & Matteo Barigozzi & Giorgio Fagiolo, 2019. "Intellectual property rights, imitation, and development. The effect on cross-border mergers and acquisitions," The Journal of International Trade & Economic Development, Taylor & Francis Journals, vol. 28(2), pages 230-256, February.
    2. Mercedes Campi & Alessandro Nuvolari, 2021. "Intellectual Property Rights and Agricultural Development: Evidence from a Worldwide Index of IPRs in Agriculture (1961-2018)," Journal of Development Studies, Taylor & Francis Journals, vol. 57(4), pages 650-668, April.
    3. Pamela Smith & Xiangwen Kong, 2022. "Intellectual property rights and trade: The exceptional case of GMOs," The World Economy, Wiley Blackwell, vol. 45(3), pages 763-811, March.
    4. Olena Ivus & Walter Park & Kamal Saggi, 2015. "Patent Protection and the Industrial Composition of Multinational Activity: Evidence from U.S. Multinational Firms," Vanderbilt University Department of Economics Working Papers 15-00014, Vanderbilt University Department of Economics.
    5. Papageorgiadis, Nikolaos & Cross, Adam R. & Alexiou, Constantinos, 2013. "The impact of the institution of patent protection and enforcement on entry mode strategy: A panel data investigation of U.S. firms," International Business Review, Elsevier, vol. 22(1), pages 278-292.
    6. Biancini, Sara & Bombarda, Pamela, 2021. "Intellectual property rights, multinational firms and technology transfers," Journal of Economic Behavior & Organization, Elsevier, vol. 185(C), pages 191-210.
    7. Damien Dussaux & Antoine Dechezleprêtre & Matthieu Glachant, 2017. "Intellectual property rights protection and the international transfer of low-carbon technologies," Working Papers hal-01693539, HAL.
    8. Huiwen Lai & Keith E. Maskus & Lei Yang, 2018. "Intellectual Property Enforcement, Exports and Productivity: Evidence from China," RSCAS Working Papers 2018/39, European University Institute.
    9. Lin, Jenny X. & Lincoln, William F., 2017. "Pirate's treasure," Journal of International Economics, Elsevier, vol. 109(C), pages 235-245.
    10. Campi, Mercedes & Dueñas, Marco, 2019. "Intellectual property rights, trade agreements, and international trade," Research Policy, Elsevier, vol. 48(3), pages 531-545.
    11. Jenny X. Lin & William Lincoln, 2017. "Pirate�s Treasure," Working Papers 17-51, Center for Economic Studies, U.S. Census Bureau.
    12. Pamela J. Smith & Sebastian J. Anti, 2022. "How does TRIPs compliance affect the economic growth of developing countries? Application of the Synthetic Control method," The World Economy, Wiley Blackwell, vol. 45(12), pages 3873-3906, December.
    13. Campi, Mercedes & Dueñas, Marco, 2016. "Intellectual Property Rights and International Trade of Agricultural Products," World Development, Elsevier, vol. 80(C), pages 1-18.
    14. Ivus, Olena & Park, Walter, 2019. "Patent reforms and exporter behaviour: Firm-level evidence from developing countries," Journal of the Japanese and International Economies, Elsevier, vol. 51(C), pages 129-147.
    15. Ronald B. Davies & Rodolphe Desbordes & Anna Ray, 2015. "Greenfield versus Merger & Acquisition FDI: Same Wine, Different Bottles?," Working Papers 201503, School of Economics, University College Dublin.
    16. Sunil Kanwar, 2010. "Intellectual Property Protection and the Licensing of Technology to Developing Countries," Working papers 188, Centre for Development Economics, Delhi School of Economics.
    17. Keith E. Maskus & William Ridley, 2016. "Intellectual Property-Related Preferential Trade Agreements and the Composition of Trade," RSCAS Working Papers 2016/35, European University Institute.
    18. Canals, Claudia & Şener, Fuat, 2014. "Offshoring and intellectual property rights reform," Journal of Development Economics, Elsevier, vol. 108(C), pages 17-31.
    19. Ushijima, Tatsuo, 2013. "Patent rights protection and Japanese foreign direct investment," Research Policy, Elsevier, vol. 42(3), pages 738-748.
    20. Ridwan Ah Sheikh & Sunil Kanwar, 2024. "Revisiting the Impact of TRIPS on IPR-intensive Export Flows: Evidence from Staggered Difference-in-Differences," Working papers 351, Centre for Development Economics, Delhi School of Economics.

    More about this item

    Keywords

    Intellectual Property Rights; Mergers and Acquisitions; Technological Intensity; Gravity Model;
    All these keywords.

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ssa:lemwps:2016/28. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/labssit.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.