Patent rights protection and Japanese foreign direct investment

Research output: Contribution to journalArticlepeer-review

21 Citations (Scopus)


This paper estimates the link between Japanese foreign direct investment (FDI) and the host country's patent rights protection (PRP) in 1985-2004. Regressions performed on data that are aggregated in a variety of ways identify a positive and significant link that is concentrated in countries with a high innovative (imitative) ability and technology-intensive industries. Firm-level logistic regressions show that the link is stronger for firms that depend more on patents to protect innovations than their industry peers. These patterns lend strong support to the argument that PRP and FDI are correlated across countries because the strengthening of PRP ameliorates investors' concerns about the spillover of proprietary technology.

Original languageEnglish
Pages (from-to)738-748
Number of pages11
JournalResearch Policy
Issue number3
Publication statusPublished - 2013 Apr
Externally publishedYes


  • Foreign direct investment
  • Japanese firm
  • Patent laws
  • Technology spillover

ASJC Scopus subject areas

  • Strategy and Management
  • Management Science and Operations Research
  • Management of Technology and Innovation


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