Intellectual Property Rights Protection & Technology Transfer In Developing Countries: Foreign Direct Investment & Domestic Technological Capabilities As Indicators

Abstract

In the globalizing economy, developing countries and those on the periphery of developing are moving to strengthen their S&T capabilities with the aim of reaching the status of emerging economies. Many of the technologies resp onsible for this transitional phase are bundle with policies that could either divert country resources or stimulate technological learning depending on the strength of intellectual property rights regime adopted. The recent WTO 's TRJPS Agreement seeks to encourage creations and inventions through various commercialization mechanisms (patents, trademarks, copyrights, etc.) with the adoption of a uniform policy. However, the agreement is tilted towards a single, strict and standardize document that equates all countries, irrespective of its economic demands and technological capabilities. This study attempts to differentiate the needs of developing countries through the analysis of FDI inflows and IP protection regimes: a) strong, b) weak. Current debates on the strength of IP protection was thoroughly studied from reviews and research papers and its implications for both developing and developed nations. This paper is di vided into two sections. The first deals with fo reign firm behaviors and type of investment towards va,y ing degrees of IP protection in developing countries. The other section complements by detailing factors responsible for technology spillovers from MNCs. From the analysis, FDI inflows show a mixed result and do not necessarily increases as countries move towards stronger I PR protection due to Dunning 's three paradigm - Ownership, Localization & Internalization (OLI). More so, the tightening of I PR would stifle technology spillovers that are considered an essential component f or stimulating local capabilities in developing countries. The paper furth er proposes for the adoption of flexible IPR regimes that is aligned on a country's technological capability and innovative capacity similar to the Principle of Common but Differentiated Responsibilities and Respected Capabilities.