Patent Rights: When Patent Protection May Either Encourage or Discourage Innovation

Since innovation is often at the heart of firm success and national growth, the relationship between the country-level factors that either encourage or discourage firm innovation and the subsequent effects on international marketing need to be better understood. Rapid changes in communication and the global competitive environment require that the traditional models for international business be reconsidered. In so doing, we evaluate the relationship between a country's patent protection regimes and firm innovation. We consider whether strong patent rights lead to increased or decreased innovation for firms competing in Developed, Developing, and Least Developed countries. Implications are explored for how individual firms, countries, and the international community can support public policy for encouraging and improving innovation and its diffusion. Finally, the managerial and international marketing implications of these relationships will be examined.