Does intellectual property rights protection affect UK and US outward FDI and earnings from FDI? A sectoral analysis

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dc.contributor.authorDe Vita, Glauco
dc.contributor.authorAlexiou, Constantinos
dc.contributor.authorTrachanas, Emmanouil
dc.contributor.authorLuo, Yun
dc.date.accessioned2021-12-06T10:49:37Z
dc.date.available2021-12-06T10:49:37Z
dc.date.issued2021-11-26
dc.description.abstractPurpose Despite decades of research, the relationship between intellectual property rights (IPRs) and foreign direct investment (FDI) remains ambiguous. Using a recently developed patent enforcement index (along with a broader IPR index) and a large sectoral country-to-country FDI dataset, the authors revisit the FDI-IPR relationship by testing the impact of IPRs on UK and US outward FDI (OFDI) flows as well as earnings from outward FDI (EOFDI). Design/methodology/approach The authors use disaggregated data for up to 9 distinct sectors of economic activity from both the US and UK for OFDI flows and EOFDI, for a panel of up to 42 developed and developing countries over sample periods from 1998 to 2015. The authors employ a panel fixed effects (FE) approach that allows exploiting the longitudinal properties of the data using Driscoll and Kraay's (1998) nonparametric covariance matrix estimator. Findings The authors do not find any consistent evidence in support of the hypothesis that countries' strength of IPR protection or enforcement affects inward FDI, or that sector of investment matters. The results prove robust to sensitivity checks that include an alternative broader measure of IPR strength, analyses across sub-samples disaggregated according to the strength of countries' IPRs as well as developing vs developed economies and an extended specification accounting for dynamic effects of the response of FDI to both previous investment levels and IPR (patent) protection. Originality/value The authors make use of the largest most granular sectoral country-to-country FDI dataset employed to date in the analysis of the FDI-IPR nexus with disaggregated data for OFDI and EOFDI across up to 9 distinct sectors of economic activity from both the US and UK The authors employ a more sophisticated measure of IPR strength, the patent index proposed by Papageorgiadis et al. (2014), which places emphasis on the effectiveness of enforcement practices as perceived by managers, together with the overall administrative effectiveness and efficiency of the national patent system.en_UK
dc.identifier.citationDe Vita G, Alexiou C, Trachanas E, Luo Y. (2021) Does intellectual property rights protection affect UK and US outward FDI and earnings from FDI? A sectoral analysis. Journal of Economic Studies, Volume 49 Issue 8, October 2022 pp. 1387-1421en_UK
dc.identifier.issn0144-3585
dc.identifier.urihttps://doi.org/10.1108/JES-09-2021-0462
dc.identifier.urihttp://dspace.lib.cranfield.ac.uk/handle/1826/17310
dc.language.isoenen_UK
dc.publisherEmeralden_UK
dc.rightsAttribution-NonCommercial 4.0 International*
dc.rights.urihttp://creativecommons.org/licenses/by-nc/4.0/*
dc.subjectIntellectual property rightsen_UK
dc.subjectPatentsen_UK
dc.subjectForeign direct investmenten_UK
dc.subjectMultinationalsen_UK
dc.subjectC23en_UK
dc.subjectF21en_UK
dc.subjectF23en_UK
dc.subjectO34en_UK
dc.titleDoes intellectual property rights protection affect UK and US outward FDI and earnings from FDI? A sectoral analysisen_UK
dc.typeArticleen_UK

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