We employ a bilateral R&D spillover model to analyze how a domestic government coordinates its intellectual property rights (IPR) and trade policies and hence affects a foreign firm’s choice between export (EX) and foreign direct investment (FDI). We find that both firms’ profits increase with IPR protection if the IPR protection level in the domestic country is loose. The domestic country can coordinate trade and IPR policies and reach a high welfare level by affecting foreign firm’s entry decisions. The profitability and desirability may decrease with the strength of IPR protection and correspond to a welfare-reducing R&D.

中文翻译：

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贸易和知识产权政策的协调

我们采用双边研发溢出模型来分析国内政府如何协调其知识产权（IPR）和贸易政策，从而影响外国公司在出口（EX）和外国直接投资（FDI）之间的选择。我们发现，如果国内的知识产权保护水平宽松，两家公司的利润都会随着知识产权保护的增加而增加。国内可以通过影响外国公司的进入决策来协调贸易和知识产权政策并达到高福利水平。盈利能力和可取性可能会随着知识产权保护的加强而降低，并对应于降低福利的研发。