Trade-related intellectual property rights: industry variation and technology diffusion

This paper assesses how a strengthening of intellectual property rights (IPRs) affects international technology diffusion by altering the volume of high-tech exports into developing countries. A simple North-South general equilibrium model in which industries differ in their imitation rates is developed. Stronger IPRs encourage Northern firms in a wider range of industries to start exporting. Exports in industries with the highest risk of imitation rise, while exports in other industries may fall. More technology diffuses to the South because new high-tech products are introduced in the Southern market. This works against the reduction in technology diffusion caused by limited imitation.