The Effect of Intellectual Property Rights Protection on the International Competitiveness of the Pharmaceutical Manufacturing Industry in China

Abstract

Research on the relationship between intellectual property rights (IPR) protection and economic growth and innovation has been often explored. However, there is an absence of research dealing with the the relationship between IPR protection and the international competitiveness of high-tech industry, especially pharmaceutical manufacturing industry. This study aims to examine the impact of the strength of IPR protection on the international competitiveness of China’s pharmaceutical manufacturing industry, by using time series data from 1995 to 2014. Modified Ginarte-Park (GP) index is used to measure the strength of IPR protection and revealed comparative advantage (RCA) index is utilized to measure the international competitiveness of China's pharmaceutical manufacturing industry. Multivariate time series model and OLS estimation are employed to examine the relationship between IPR protection and RCA index. The result shows that strict IPR protection does not enhance the international competitiveness of China’s pharmaceutical manufacturing industry. The finding suggests that it is more appropriate to adopt a more relaxed IPR protection system for pharmaceutical manufacturing industry in China.

DOI: http://dx.doi.org/10.5755/j01.ee.29.1.16878