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Growth, Trade and Patents : A Quantitative Evaluation of TRIPS

We aim to provide the first quantitative evaluation of the 1994 TRIPS agreement, which has largely standardized world patenting systems. We document a sharp increase in patenting in developing countries following the implementation of TRIPS. We develop a trade and innovation based model on Eaton and Kortum (2002) and Romer (1990), in which innovating firms may decide where to patent. We now intend to calibrate our model pre- and post-TRIPS eras by matching trade and patenting data from French firms together with similar aggregate data for the rest of the world. This will allow us to assess how much TRIPS has changed firms' incentives to innovate. Using our model, we will then be able to measure the effects of TRIPS and welfare and evaluate how close this agreement is to the optimal policy.