GW-CIBER Funded Projects: 2011-2012
Do Stronger Intellectual Property Rights Induce More Innovation? Evidence That the Intellectual Property Rights Regime of Trade Partners Impacts Domestic Firm Innovation.
PI: Joel Blit, Assistant Professor, Department of Economics, CCAS
Intellectual Property Rights (IPR) are among the key state institutions that frame the innovative activities of firms and this project seeks to understand its evolving role in a context of increasing globalization. While most studies have found a positive correlation between IPR and firm R&D in panel data (at least for developed countries), it is not clear that one can attribute a causal relationship. The correlation may arise because as firms increase their R&D they begin lobbying the government for increased IPR so as to better protect their investment. My project assesses whether the relationship is causal by examining whether the R&D expenditures of export-oriented sectors respond to changes in the IPR regimes of its export markets. In addition, the project will compare the relative impact of home and export market IPR on the R&D of home firms.
External Knowledge Sourcing Through Domestic and Foreign Acquisitions; Impact of M&As on Target, Acquirer, and Third-Party Innovation
PI: Wenjie Chen, Assistant Professor, Department of International Business, GWSB; Joel Blit, Assistant Professor, Department of Economics, CCAS
Firms are increasingly seeking sources of innovation abroad and a primary method through which they do so is foreign mergers and acquisitions (M&As). This project examines how M&As affect innovation in the acquirer and target firm, and knowledge flows between: a. acquirer and target, b. acquirer and third-party firms in the location of the target, and c. target and third-party firms in the home country of the acquirer. We will also examine how the characteristics and national origin of the acquirer affects these outcomes. In particular, we make the distinction between acquirer country origin and acquirer type, i.e. a publicly listed firm, a private firm or a government owned entity. As a result, this study will examine the effects of state owned enterprises as vehicles to access foreign knowledge and develop national innovative capability.
Looking Beyond Home and Host Countries: International Institutions and Foreign Investment
PI: Srividya Jandhyala, Assistant Professor, Department of International Business, GWSB
Although the impact of home and host country property rights institutions on Multinational Enterprises’ (MNE) investment strategies has received significant attention in the literature, domestic institutions tend to be relatively stable with small changes over time in their composition, strength, and effectiveness. On the other hand, international institutional systems, such as Bilateral Investment Treaties (BITs), providing extensive rights and protection to foreign investors have proliferated rapidly during the last few decades. This project examines the impact of Bilateral Investment Treaties on investors’ willingness to pay for foreign petroleum assets. The results are expected to inform managers about the security and valuation of their foreign assets as well as policy makers about the effectiveness of BITs in conferring incentives to foreign investors.
The Politics of International Investment and Intellectual Property Rights
PI: Susan Sell, Professor, Department of Political Science, CCAS
This project proposes to design a graduate course for the ESIA International Trade and Investment Program that addresses and analyzes the politics of investment and intellectual property. The course will provide students with an understanding of the firm-state-society relations that animate this complex and dynamic policy area. The course will be team-taught with Jacques Gorlin, an economics PhD who was a leading adviser to the Fortune 500 business firms (including Microsoft, IBM, Monsanto, and Merck) that succeeded in developing the WTO Agreement on Trade-related Intellectual Property Rights (TRIPs). The course will exist as a three or four week course in May 2012. The first two or three weeks would consist of intensive seminars in which students would learn about the issues, read primary and secondary source material, and hear from DC-based industry, government, and NGO representatives active in this policy area. After providing students with sufficient background about the issues, the controversies, the core actors, the interests, and the relevant institutions, we would bring the students to Geneva for a week of briefings and lectures by international organization representatives (e.g., from WIPO and WTO), developing country think tanks (Third World Network, the South Centre, and International Center for Trade and Sustainable Development), Geneva-based industry associations (e.g., International Federation for Pharmaceutical Manufacturers Association), and IP-Watch.
Characteristics and Implications of Chinese Macroeconomic Data Revisions
PI: Tara M. Sinclair, Assistant Professor, Department of Economics, CCAS
Firms depend on macroeconomic data as key inputs to their production and pricing decisions. Generally data released by official government agencies are considered trustworthy and valuable for business decisions, but the quality of data released by the China’s statistical authorities has regularly been questioned by both the media and researchers. One aspect of the data quality that has yet to be fully studied is the pattern of the revisions to the data made by the Chinese government. Two different types of data revisions are made: regular revisions as delayed data arrive and more substantial benchmark revisions which have occurred following the two economic censuses. Open research questions include: Are the revisions more commonly made in one direction or another resulting in a bias in the revisions on average? Is there a pattern in the revisions over time, such as is a positive revision more likely to be followed by another positive revision, or are there certain times when larger revisions are likely to occur? The proposed study will substantially improve our understanding of the properties of Chinese statistical data releases.
FDI & Energy Security. Do Managers Carry the Flag?
PI: Robert Weiner, Professor, Department of International Business, GWSB
The resurgence of the state in the global economy has led researchers to refocus on the effects of government actions. This paper investigates whether the return of state capitalism is taking place through multinational enterprises (MNEs), private as well as state-owned. In particular, we examine whether MNE managers act in the interest of their home-country policies in foreign direct investment (FDI) decisions, termed carrying the flag. While widely discussed in the press, state capitalism presents stiff research challenges – state objectives are typically hard to characterize at best, unclear or conflicting at worst. How can we determine if MNE managers are carrying the flag in the absence of clear home-country policy goals? We meet this challenge by examining an arena wherein the governments of some countries have a clearly stated goal – energy security, specifically access to oil.