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How Do Copyrights Affect Economic Development and International Trade?
Author(s) -
Smith Pamela J.,
Da'ar Omar B.,
Monroe Kevin H.,
Nunez Fabricio X.,
Tuttle Charlotte J.
Publication year - 2009
Publication title -
the journal of world intellectual property
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.334
H-Index - 8
eISSN - 1747-1796
pISSN - 1422-2213
DOI - 10.1111/j.1747-1796.2009.00360.x
Subject(s) - harmonization , economics , bilateral trade , international trade , capital (architecture) , sample (material) , international economics , business , chemistry , physics , archaeology , chromatography , political science , acoustics , law , china , history
This article analyzes the effects of copyrights on economic development and international trade. First, we apply an aggregate production function to examine the effects of “copyright‐related capital” (CRC) on development. This form of capital includes personal computers, servers, and bandwidth, which embody or transmit copyrighted materials. Second, we apply the gravity model of international trade to examine the effects of copyright policies on bilateral trade in core copyright industries. Third, we integrate the above frameworks to examine the two‐stage effects of copyrights on development, and then on trade. We analyze these relationships using cross‐sectional data for a large sample of countries. The findings show that a country's CRC contributes positively to its economic development. The findings also show that the relative harmonization of copyright policies between countries has a positive effect on bilateral trade in core copyright industries. Finally, the findings show evidence of a two‐stage process where a country's CRC contributes positively to its economic development (stage 1), which then contributes positively to its trade (stage 2).