The Effect of Intellectual Property Rights on Agricultural Productivity

Abstract

This article explores how the strengthening of intellectual property (IP) protection affects agricultural productivity in a panel of countries for the period 1961–2011. Using an index of IP protection for plant varieties, we study the effect of stronger intellectual property rights (IPRs) on cereal yields and two different types of cereals: Open-pollinated (wheat) and hybrid (maize). We found that the strengthening of IPRs has a positive effect on productivity of cereals for high- and low-income countries. However, we found no significant effect for middle-income countries. In addition, we found that becoming a member of the Trade Related Aspects of Intellectual Property Rights negatively affects cereal yields. Finally, we found evidence of the existence of nonlinearities in the effect of IPRs on agricultural yields, which confirms a threshold effect of IPRs that also varies for countries of different income level. The findings support the hypothesis that country specificities are important in determining the effect of IPRs and imply that there is no unique system that fits all.