nep-ipr New Economics Papers
on Intellectual Property Rights
Issue of 2019‒07‒15
three papers chosen by
Giovanni Ramello
Università degli Studi del Piemonte Orientale “Amedeo Avogadro”

  1. Political Animosity in the Global Value Chain: Whether Taiwanese Consumers are willing to Purchase International Brand Made in China Mainland? By ZHANG Geng; SU Shuitian
  2. The Impact of Intellectual Property Rights on Labor Productivity: Do Constitutions Matter? By Emanuela Carbonara; Giuseppina Gianfreda; Enrico Santarelli; Giovanna Vallanti
  3. Costly auction entry, royalty payments, and the optimality of asymmetric designs By Bernhardt, Dan; Liu, Tingjun; Sogo, Takeharu

  1. By: ZHANG Geng; SU Shuitian
    Abstract: This paper explored the impact of political animosity on consumers’ willingness to purchase in the context of the global value chain and found that openness value and familiarity can weaken the negative impact of political animosity on consumers’ willingness to purchase. Thus, this paper expanded the application of the consumer animosity model. The research background of this paper is whether Taiwanese consumers’ willingness to purchase is affected by political animosity when they face international clothing brand made by China Mainland. The empirical results showed that political animosity can significantly lower the willingness of Taiwanese consumers to purchase international brand with China Mainland participation in its value chain. However, if Taiwanese consumers hold higher openness value or increase their familiarity with China Mainland, the negative effect of political animosity can be effectively weakened. The empirical results also brought inspirations to everyone. If Taiwanese consumers can have an open mind to China Mainland and be more proactive in their contacts with China Mainland, their political animosity towards China Mainland will gradually disappear.
    Keywords: Political Animosity; Openness Value; Familiarity; Willing to Purchase; Global Value Chain
    Date: 2019–07–06
  2. By: Emanuela Carbonara (Università di Bologna); Giuseppina Gianfreda (Università della Tuscia); Enrico Santarelli (Università di Bologna); Giovanna Vallanti (LUISS "Guido Catli")
    Abstract: Focusing on 22 OECD countries we estimate the impact of constitutional provisions and of lower-rank norms aimed at protecting intellectual property rights (IPR) on labor productivity at industry level. Our analysis allows us to answer the following questions: Are IPR more likely to be enforced if they are envisaged in the constitution rather than provided for in ordinary legislation? And if constitutional protection implies an accrued defense or enforcement of those principles, is this difference relevant enough to translate into a higher impact on firms’ outcome? By using IV techniques and controlling for a full set of year-, industry- and country fixed effects (and their interactions), we show that constitutional provisions protecting IPR positively affect the differential in labor productivity between high and low R&D intensive sectors. This effect is driven by the impact of IPR protection on R&D investment of the highly innovative sectors. Our results hold after controlling for lower-rank norms. Furthermore, the interaction between constitutional norms and lower legislation is negative, suggesting that the two are substitutes: the impact of constitutions is stronger in those countries where IPR protection by lower norms is weaker. On turn, in those countries where IPR are protected by constitutional norms, lower norms do not have a significant effect on the productivity of high R&D intensive sectors.
    Keywords: Constitutions; Intellectual Property Rights; R&D; Labor productivity; OECD countries
    JEL: D24 K10 O47
    Date: 2019
  3. By: Bernhardt, Dan (University of Illinois & University of Warwick); Liu, Tingjun (The University of Hong Kong); Sogo, Takeharu (Osaka University of Economics)
    Abstract: We analyze optimal auction mechanisms when bidders base costly entry decisions on their valuations, and bidders pay with a fixed royalty rate plus cash. With sufficient valuation uncertainty relative to entry costs, the optimal mechanism features asymmetry so that bidders enter with strictly positive but different (ex-ante) probabilities. When bidders are ex-ante identical, higher royalty rates—which tie payments more closely to bidder valuations—increase the optimal degree of asymmetry in auction design, further raising revenues. When bidders differ ex-ante in entry costs, the seller favors the low cost entrant ; whereas when bidders have different valuation distributions, the seller favors the weaker bidder if entry costs are low, but not if they are high. Higher royalty rates cause the seller to favor the weaker bidder by less, and the strong bidder by more.
    Keywords: Auctions with participation costs : Royalty payments ; Optimal auctions ; Asymmetric auctions ; Heterogeneous bidders
    JEL: D44 G3
    Date: 2019

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