Home/Working Papers/Appropriability and Complementarities in a Fragile Patent System: Evidence from Brazilian Manufacturing
Appropriability and Complementarities in a Fragile Patent System: Evidence from Brazilian Manufacturing
Código: WPE – 328
Henrique M. Barros
Despite growing attention devoted to the understanding of how firms appropriate the returns from innovation, our knowledge as to firms’ appropriation strategies in weak institutional settings is scant. Weak institutions do not adequately allow the enforcement of property rights even in the presence of enacted legislation. Thereby, we suspect that the current rationale that complementarities between patents and other appropriability mechanisms exist does not hold under such conditions. This paper tests this proposition by analysing a unique dataset on innovative activities in Brazil. Our analysis reveals that weak institutions actually constrain potential strategic interactions between patents and informal mechanisms (i.e., secrecy, leadtime, and complexity of the design). More specifically, the use of formal mechanisms (i.e. utility model, registration of design, copyright, and trademark) is positively related to the use patents whereas the use of informal mechanisms to reap the benefits from innovation is not related to the use of patents.