MARKET SIZE AND INTELLECTUAL PROPERTY PROTECTION* |
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| Authors: | Michele Boldrin David K Levine |
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| Institution: | 1. Washington University in Saint Louis, Federal Reserve Bank of Saint Louis, and CEPR;2. Washington University in Saint Louis and NBER;3. This article is based upon work supported by the National Science Foundation under Grants SES 01‐14147 and 03‐14713. M. Boldrin also acknowledges research support from SEJ2005‐08783‐C04‐01 (Ministry of Education, Spain). Our ideas benefited from comments received during presentations at Columbia University, Dallas, Richmond, and San Francisco Federal Reserve Banks, Chinese University of Hong Kong, ASU, and Rochester, and from discussions with Kyle Bagwell, Gene Grossman, Chad Jones, Pete Klenow, Paul Romer, Suzanne Scotchmer, and Daniel Wilson. Thanks are also due to Hengjie Ai for research assistance in collecting and analyzing data. We are also grateful to two anonymous referees for their detailed comments. Please address correspondence to: Michele Boldrin, Department of Economics, Washington University, St. Louis, MS 63130. Phone: (314) 935‐5636. Fax: (314) 935‐4156. E‐mail: . |
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| Abstract: | Intellectual property (IP) protection involves a trade‐off between the undesirability of monopoly and the desirable encouragement of creation and innovation. Optimal policy depends on the relative strength of these two forces. We give a quantitative assessment of current IP policies. We focus particularly on the scale of the market, showing that as it increases, due either to growth or to the expansion of trade, IP protection should be reduced. |
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