Intellectual property protection and enterprise’s export technological complexity under the background of incomplete contract
【Abstract】Based on the realistic background of incomplete contract, this paper innovatively analyzes the mechanism between intellectual property protection and enterprise’s export technological complexity. Through the game equilibrium between the manufacturer and the supplier, it is explained that under the condition of incomplete contract, strengthening intellectual property protection will reallocate more residual claims of returns on high technology’s investment to suppliers，reduce the risk of being “ripped off” of supplier, encourage suppliers to increase investment in high technology，and then lead to the improvement of the technology level of the whole society. The export technological complexity of enterprise, calculated by using the matching data between Chinese industrial enterprises database and Chinese customs trade database, supports the hypothesis that strengthening intellectual property protection will promote export technological complexity of enterprise. The study also found that strengthening intellectual property protection is more benefit for improving the export technological complexity of enterprises with the high intensity of contract and non-state-owned enterprises, for narrowing the gap of export technological complexity between east and mid-west. Intellectual property protection can incentive human capital investment of high technical activities, activate the enterprise to innovate and improve enterprise’s export technological complexity. The empirical results show robust characteristics for samples with different econometric methods, instrumental variables and time intervals for endogeneity, core index. This paper’s study has an important enlightenment on Chinese economy how to stimulate the enterprise’s vitality and innovation and achieve high-quality development pattern.
【Keywords】 intellectual property protection; export technological complexity of enterprise; residual claims; incomplete contract;
. ① For the detailed derivation process, please refer to the public annex of China Industrial Economics website (http://www.ciejournal.org). [^Back]
. ① For the detailed derivation process of formulas (10)–(12), please refer to the public annex of China Industrial Economics website (http://www.ciejournal.org). [^Back]
. ① These three methods impose more hypotheses, and these hypotheses will affect the conclusion of the model, so they are only used as robustness test. See the public annex of the website of China Industrial Economics for more detailed measurement description (http://www.ciejournal.org). [^Back]
. ① The results of the statistical description chart and table of variables are shown in the public annex of China Industrial Economics website (http://www.ciejournal.org). [^Back]
. ① For the detailed test results of random effect and fixed effect, please refer to the public annex of China Industrial Economics website (http://www.ciejournal.org). [^Back]
. ① This paper also makes an analysis and description of time heterogeneity and regional heterogeneity. For more detailed test results and analysis, please refer to the public annex of China Industrial Economics website (http://www.ciejournal.org). [^Back]
. ① Because the contract intensity of this paper is an industry variable, when the fixed effect is controlled, the fixed industry will lead to multiple collinearity, so we delete this variable. Here only the analysis of fixed firm and time effect is used. [^Back]
. ① Because the instrumental variable is the data of provinces and the instrumental variable data is sparse, it is easy to produce multiple collinearity with the fixed effect of the province, which leads to the lack of instrumental variable identification. Therefore, this paper only does the endogenous test to control the enterprise effect and the year effect. For endogeneity test results, please refer to the public annex of China Industrial Economics website (http://www.ciejournal.org). [^Back]
. ① For the detailed results of robustness test, please refer to the public annex of China Industrial Economics website (http://www.ciejournal.org). [^Back]
. ① There are three types of technical titles: senior technical titles, intermediate technical titles and primary technical titles. In this paper, regional human capital is not selected as the channel analysis variable because regional variables cannot describe the specific impact of human capital on the enterprise level in detail. The number of technical personnel divided by ten can smooth the data. This paper does not divide the number of technicians by the number of employees, because the number of enterprises with technical titles in 2004 is very small. If it is used to divide the number of employees, the heterogeneity of the data will loss. [^Back]
1. Dai, Z. Studies in Science of Science (科学学研究), (12) (2014).
2. Dai, Z., Liang, J. & Sun, Q. Finance & Trade Economics (财贸经济), (7) (2015).
3. Fan, G., Wang, X. & Zhu, H. NERI INDEX of Marketization of China’s Provinces 2011 Report (中国市场化指数: 各地区市场化相对进程2011年报告). Beijing: Economic Science Press (2011).
4. Gu, S., Han, L. & Zhuang, Q. Economic Review Journal (经济纵横), (2) (2018).
5. Jiang, X. Management World (管理世界), (9) (2016).
6. Jiang, W. & Zhang, L. China Industrial Economics (中国工业经济), (2) (2015).
7. Li, K. & Wang, Y. China Economic Quarterly (经济学(季刊)), (3) (2010).
8. Li, Y. & Li, Y. China Industrial Economics (中国工业经济), (5) (2018).
9. Qi, J. & Wang, L. The Journal of World Economy (世界经济) (3) (2015).
10. Sheng, B. & Mao, Q. The Journal of World Economy (世界经济) (12) (2017).
11. Wang, Z., Duan, B., Wang, Y. et al. China Industrial Economics (中国工业经济), (3) (2017).
12. Wu, C. & Tang, D. Economic Research Journal (经济研究) (11) (2016).
13. Xu, Z. Science Technology and Law (科技与法律) (4) (2015).
14. Xu, C. & Shan, X. Studies in Science of Science (科学学研究), (4) (2008).
15. Xu, H., Chen, L. & Sun, T. China Industrial Economics (中国工业经济), (10) (2017).
16. Xu, J., Mao, Q. & Hu, A. The Journal of World Economy (世界经济) (3) (2017).
17. Yang, L. & Wang, J. China Economic Studies (中国经济问题) (3) (2015).
18. Yang, R. & Nie, H. Economic Research Journal (经济研究) (2) (2006).
19. Yao, Y. & Zhang, Y. Social Sciences in China (中国社会科学) (2) (2008).
20. Zhu, Z., Huang, X. & Yu, X. China Industrial Economics (中国工业经济), (8) (2018).
21. Acemoglu，D., P. Antras, and E. Helpman. Contracts and Technology Adoption. American Economic Review, 2007, 97(97): 916–943.
22. Brandt, L., J. V. Biesebroeck, and Y. Zhang. Creative Accounting or Creative Destruction? Firm-Level Productivity Growth in Chinese Manufacturing. Journal of Development Economics, 2012, 97(2): 339–351.
23. Dai, M., M. Maitra, and M. Yu. Unexceptional Exporter Performance in China? The Role of Processing Trade. Journal of Development Economics, 2016 121(4): 177–189.
24. Fan, H., Y. A. Li， and S. R. Yeaple. Trade Liberalization, Quality, and Export Prices. NBER Working Paper, 2014.
25. Freund, C. L. The Anatomy of China’s Export Growth. Social Science Electronic Publishing, 2008, 199(5): 1–29.
26. Ginarte, J. C. W. G. Park. Determinants of Patent Rights: A Cross-national Study. Research Policy, 1997, 26(3): 283–301.
27. Grossman, S. J.，and O. D. Hart. The Costs and Benefits of Ownership: A Theory of Vertical and Lateral Integration. Journal of Political Economy, 1986, 94(4): 691–719.
28. Hart, O., and J. Moore. Property Rights and the Nature of the Firm. Journal of Political Economy, 1990, 98(6): 1119–1158.
29. Hausmann, R., J. Hwang, and D. Rodrik. What You Export Matters. Journal of Economic Growth, 2007, 12(1): 1–25.
30. Horii, R., and T. Iwaisako. Economic Growth with Imperfect Intellectual property protection Rights. Journal of Economics, 2007, 90(1): 45–85.
31. Hudson, J., and A. Minea. Innovation, Intellectual Property Rights, and Economic Development: A Unified Empirical Investigation. World Development, 2013, 46(2): 66–78.
32. Mokyr, J. Intellectual Property Rights, the Industrial Revolution, and the Beginnings of Modern Economic Growth. American Economic Review, 2009, 99(2): 349–355.
33. Nunn, N. Relationship-Specificity, Incomplete Contracts, and the Pattern of Trade. Quarterly Journal of Economics, 2007, 122(2): 569–600.
34. Park, W. G. International Patent Protection: 1960–2005. Research Policy, 2008, 37(4): 761–766.
35. Schwartz, A. Relational Contracts in the Courts: An Analysis of Incomplete Agreements and Judicial Strategies. Journal of Legal Studies, 1992, 21(2): 271–318.
36. Schwartz, A. The Default Rule Paradigm and the Limits of Contract Law. Southern California Interdisciplinary Law Journal, 1994, (3): 389–419.
37. Upward, R., Z. Wang, and J. Zheng. Weighing China’s Export Basket: The Domestic Content and Technology Intensity of Chinese Exports. Journal of Comparative Economics, 2013, 41(2): 527–543.
38. Williamson, O. E. Markets and Hierarchies: Analysis and Antitrust Implications. New York: Free Press, 1975.