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Intellectual Property Rights and Entry into a Foreign Market: FDI vs. Joint Ventures AgEcon
Leahy, Dermot; Naghavi, Alireza.
We study the effect of the intellectual property rights (IPR) regime of a host country (South) on a multinational's decision between serving a market via greenfield foreign direct investment to avoid the exposure of its technology or entering a joint venture (JV) with a local firm, which allows R&D spillovers under imperfect IPRs. JV is the equilibrium market structure when R&D intensity is moderate and IPRs strong. The South can gain from increased IPR protection by encouraging a JV, whereas policies to limit foreign ownership in a JV gain importance in technology intensive industries as complementary policies to strong IPRs.
Tipo: Working or Discussion Paper Palavras-chave: International Relations/Trade; Research and Development/Tech Change/Emerging Technologies.
Ano: 2006 URL: http://purl.umn.edu/12089
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