Like the original Spencer-Brander result, the R&D incentives that we identify lead governments to set positive R&D subsides in the non-cooperative equilibrium. However, we find that if exporting governments could cooperate over their policy choices they would continue to subsidize R&D, rather...

This paper provides a theoretical framework to explain why governments seek restrictions on IPR protection and allow R&D subsidies through multilateral trade agreements such as the TRIPS Agreement and the Agreement on Subsidies and Countervailing Measures. After 7 years of discussion, the...

This paper is useful in that it succeeds in identifying and characterizing the interesting effects that exogenous variation in the degree of IPR protection can have on standard strategic trade policy arguments. In pointing out the importance of the IPR regime for understanding, the incentives to...