<%BANNER%>

Patents, North-South Trade and Global Growth

Permanent Link: http://ufdc.ufl.edu/UFE0022151/00001

Material Information

Title: Patents, North-South Trade and Global Growth
Physical Description: 1 online resource (91 p.)
Language: english
Creator: Leesamphandh, Pipawin
Publisher: University of Florida
Place of Publication: Gainesville, Fla.
Publication Date: 2008

Subjects

Subjects / Keywords: growth, imitation, innovation, multinationals, patents, schempeterian
Economics -- Dissertations, Academic -- UF
Genre: Economics thesis, Ph.D.
bibliography   ( marcgt )
theses   ( marcgt )
government publication (state, provincial, terriorial, dependent)   ( marcgt )
born-digital   ( sobekcm )
Electronic Thesis or Dissertation

Notes

Abstract: We developed a North-South model with global patent protection in the presence of trade costs. The model generated endogenous Schumpeterian growth and product-cycle trade. The first model was used to analyze the effects of globalization through trade liberalization and a geographic expansion in the size of the South. A reduction in trade costs worsens the North-South income inequality by increasing the wage-gap between the two regions. Globalization has an ambiguous effect on the steady-state rate of technology transfer and has no effect on either innovation or the growth rate. Next, we built a simple general-equilibrium model of scale-invariant long-run Schumpeterian (R & D-based) growth, finite-length patents, and endogenous patent enforcement policies. The latter were captured by a probability function which depends on the government resources engaged in the enforcement of patents granted to firms that discover new higher-quality products. An increase in the patent length raises the probability of patent enforcement; this result is consistent with cross country evidence showing that patent enforcement and patent duration are complements. In addition, the model predicted that economies with low productivity of R & D researchers have weaker patent enforcement policies and lower long-run Schumpeterian growth. Lastly, we introduced an endogenous multi-nationalization process into a North-South model of scale-invariant long-run Schumpeterian growth with a finite-length patent protection. The latter is perfectly enforceable in the North but imperfectly enforceable in the South. The model was used to examine the effects of intellectual property rights policy and globalization on Foreign Direct Investment (FDI) and the world income distribution. The effectiveness of patent enforcement does not effect the decision of a firm to become MNCs. However, an increase in patent length reduces the flow of FDI and worsens the income distribution between regions. In addition, globalization, measured as a geographic expansion in the size of the South, increases the flow of FDI but worsens the North-South income distribution. Lastly, an improvement in innovation technology leads to a decline in FDI and worsens the North-South wage gap.
General Note: In the series University of Florida Digital Collections.
General Note: Includes vita.
Bibliography: Includes bibliographical references.
Source of Description: Description based on online resource; title from PDF title page.
Source of Description: This bibliographic record is available under the Creative Commons CC0 public domain dedication. The University of Florida Libraries, as creator of this bibliographic record, has waived all rights to it worldwide under copyright law, including all related and neighboring rights, to the extent allowed by law.
Statement of Responsibility: by Pipawin Leesamphandh.
Thesis: Thesis (Ph.D.)--University of Florida, 2008.
Local: Adviser: Dinopoulos, Elias.
Electronic Access: RESTRICTED TO UF STUDENTS, STAFF, FACULTY, AND ON-CAMPUS USE UNTIL 2010-08-31

Record Information

Source Institution: UFRGP
Rights Management: Applicable rights reserved.
Classification: lcc - LD1780 2008
System ID: UFE0022151:00001

Permanent Link: http://ufdc.ufl.edu/UFE0022151/00001

Material Information

Title: Patents, North-South Trade and Global Growth
Physical Description: 1 online resource (91 p.)
Language: english
Creator: Leesamphandh, Pipawin
Publisher: University of Florida
Place of Publication: Gainesville, Fla.
Publication Date: 2008

Subjects

Subjects / Keywords: growth, imitation, innovation, multinationals, patents, schempeterian
Economics -- Dissertations, Academic -- UF
Genre: Economics thesis, Ph.D.
bibliography   ( marcgt )
theses   ( marcgt )
government publication (state, provincial, terriorial, dependent)   ( marcgt )
born-digital   ( sobekcm )
Electronic Thesis or Dissertation

Notes

Abstract: We developed a North-South model with global patent protection in the presence of trade costs. The model generated endogenous Schumpeterian growth and product-cycle trade. The first model was used to analyze the effects of globalization through trade liberalization and a geographic expansion in the size of the South. A reduction in trade costs worsens the North-South income inequality by increasing the wage-gap between the two regions. Globalization has an ambiguous effect on the steady-state rate of technology transfer and has no effect on either innovation or the growth rate. Next, we built a simple general-equilibrium model of scale-invariant long-run Schumpeterian (R & D-based) growth, finite-length patents, and endogenous patent enforcement policies. The latter were captured by a probability function which depends on the government resources engaged in the enforcement of patents granted to firms that discover new higher-quality products. An increase in the patent length raises the probability of patent enforcement; this result is consistent with cross country evidence showing that patent enforcement and patent duration are complements. In addition, the model predicted that economies with low productivity of R & D researchers have weaker patent enforcement policies and lower long-run Schumpeterian growth. Lastly, we introduced an endogenous multi-nationalization process into a North-South model of scale-invariant long-run Schumpeterian growth with a finite-length patent protection. The latter is perfectly enforceable in the North but imperfectly enforceable in the South. The model was used to examine the effects of intellectual property rights policy and globalization on Foreign Direct Investment (FDI) and the world income distribution. The effectiveness of patent enforcement does not effect the decision of a firm to become MNCs. However, an increase in patent length reduces the flow of FDI and worsens the income distribution between regions. In addition, globalization, measured as a geographic expansion in the size of the South, increases the flow of FDI but worsens the North-South income distribution. Lastly, an improvement in innovation technology leads to a decline in FDI and worsens the North-South wage gap.
General Note: In the series University of Florida Digital Collections.
General Note: Includes vita.
Bibliography: Includes bibliographical references.
Source of Description: Description based on online resource; title from PDF title page.
Source of Description: This bibliographic record is available under the Creative Commons CC0 public domain dedication. The University of Florida Libraries, as creator of this bibliographic record, has waived all rights to it worldwide under copyright law, including all related and neighboring rights, to the extent allowed by law.
Statement of Responsibility: by Pipawin Leesamphandh.
Thesis: Thesis (Ph.D.)--University of Florida, 2008.
Local: Adviser: Dinopoulos, Elias.
Electronic Access: RESTRICTED TO UF STUDENTS, STAFF, FACULTY, AND ON-CAMPUS USE UNTIL 2010-08-31

Record Information

Source Institution: UFRGP
Rights Management: Applicable rights reserved.
Classification: lcc - LD1780 2008
System ID: UFE0022151:00001


This item has the following downloads:


Full Text
xml version 1.0 encoding UTF-8
REPORT xmlns http:www.fcla.edudlsmddaitss xmlns:xsi http:www.w3.org2001XMLSchema-instance xsi:schemaLocation http:www.fcla.edudlsmddaitssdaitssReport.xsd
INGEST IEID E20101221_AAAABE INGEST_TIME 2010-12-21T16:31:50Z PACKAGE UFE0022151_00001
AGREEMENT_INFO ACCOUNT UF PROJECT UFDC
FILES
FILE SIZE 112340 DFID F20101221_AAAXYK ORIGIN DEPOSITOR PATH leesamphandh_p_Page_89.jpg GLOBAL false PRESERVATION BIT MESSAGE_DIGEST ALGORITHM MD5
ab1a32c55b03229ffc568a5463bcd552
SHA-1
cb768fb47730ac98ca793397a20d013326a03edd
4564 F20101221_AAAXXW leesamphandh_p_Page_11thm.jpg
f6d6b6cfaed9faa9d80b1f0b984c11e6
d481a9e0a80b9231c3e756707b8894dcd483ea07
613317 F20101221_AAAYEF leesamphandh_p_Page_41.jp2
76d872fe289f73581c2463e718db1bef
a3bf536e2f84a3eeb95c051534a917076e564ccd
960529 F20101221_AAAYDQ leesamphandh_p_Page_22.jp2
27b77a1fb0ed47237d874f739b869ea1
54ac80c9a7fb9de572e5d3ec43de3d49bc59615e
29598 F20101221_AAAXYL leesamphandh_p_Page_69.QC.jpg
6be4cc2b575b5652fb4ff8f51c32065d
1f25951f357b3f778e1171cc091d80f8546a19d0
39194 F20101221_AAAXXX leesamphandh_p_Page_69.pro
a1c6aba0ca72d77bb7d65ee11e993de8
7c1816ef82d835247a3d6e5fd7cc44074be8afbc
531813 F20101221_AAAYEG leesamphandh_p_Page_42.jp2
41bf05dd5540edea2b83814b27a608e4
a02a9a2040b5bd608c71a7c0508e117c93b4032c
6462 F20101221_AAAXZA leesamphandh_p_Page_82thm.jpg
3fa2dc15aaf6e8f49e289811bbb46cf2
1518058a5f2ba4438021cc4091b34c4a6c8f31d4
935046 F20101221_AAAYDR leesamphandh_p_Page_23.jp2
09cc5cb8394e2fc2f9a2ac5f32d6567c
7da966a14bafd85ca8e0655fc26976292eeadf4b
59156 F20101221_AAAXYM leesamphandh_p_Page_88.pro
704a60ea4d9830f846d296c65bd4e98d
a2c1975497848c1d93e6bc943211bc78479ee24b
7536 F20101221_AAAXXY leesamphandh_p_Page_30thm.jpg
8ebc09d711f1640678cf9e5c414fec5e
44ed421872b37613696e72ed3d267503fac3c3d7
348320 F20101221_AAAYEH leesamphandh_p_Page_43.jp2
bbcc9569bdb9ead2231884d2ec3331b2
ecc47545b2379428abacb46299c53e9a01623d0d
1992 F20101221_AAAXZB leesamphandh_p_Page_24.txt
60b83bb33190be650ca0e11715d90cd6
a894771b116b0b4d0f4dee1e9058f0b60345e06e
896939 F20101221_AAAYDS leesamphandh_p_Page_24.jp2
01e12de6fd0d05f62f5e6bb02304f5c1
01de8090af0bc5b361d297069e166525398a9bae
25271604 F20101221_AAAXYN leesamphandh_p_Page_40.tif
74560d0a9f67e31c6c4e0b26368aff0c
4e9f031141311702e344391d1a96c598c015ee8c
972152 F20101221_AAAXXZ leesamphandh_p_Page_35.jp2
cb432566288af8e54d2e6073f9d9e5fa
4d1841524724e17a095ed90dba4c9d2236710056
1051985 F20101221_AAAYEI leesamphandh_p_Page_44.jp2
b5aa9d1f7570e0f0f62a6524fb3c22a8
d5e9012df3063521ec1abebc416b8d091c0bf9a2
7610 F20101221_AAAXZC leesamphandh_p_Page_29thm.jpg
c8c40124bd2318681e69b5bdf97dd102
4fb5bda2fa5aa6b04aecc4864288a434a12b6085
844662 F20101221_AAAYDT leesamphandh_p_Page_26.jp2
27ea2c1c7cab68f7e26d527ec89fa307
ec1188ee925f87f6c9038ca70ad6cc2cdf680a8c
28466 F20101221_AAAXYO leesamphandh_p_Page_19.QC.jpg
a3f9e41ec9cdd75f2fb2f84e18204ef5
86407fd9f5db0a5acdbb4db618282fb98f1e3e02
1051968 F20101221_AAAYEJ leesamphandh_p_Page_45.jp2
e3236d88ac3b53aa4aa42dab5863d7d8
e5c342fb6e352f43309812cdacc6458fd6b4f9f1
689864 F20101221_AAAXZD leesamphandh_p_Page_82.jp2
e76215eb4456d6e80518b8a5c98b953c
271d281d84e839eb07fb80406a2cf00c5c5b53a0
987870 F20101221_AAAYDU leesamphandh_p_Page_28.jp2
3267c772d68d96990d5abaad45a7c01a
0b7497925d0372ab83da0305c6ed76e57f8470b1
35686 F20101221_AAAXYP leesamphandh_p_Page_37.pro
e6861337f42ff411d939e907301c7835
7d12628aee924325c2d57dbe14ac2b0382954e3c
1051904 F20101221_AAAYEK leesamphandh_p_Page_46.jp2
f0a1b6f5cca4badf7369b5794353c367
65d584db74a1c128f1c69d7674f653f8abd3edd2
70924 F20101221_AAAXZE leesamphandh_p_Page_39.jpg
c21873ef3dc4153eb5bce2ff0549a607
1e78804a2e14a5059f76e22e09e0b7d954cf2b4e
904123 F20101221_AAAYDV leesamphandh_p_Page_29.jp2
7c2b0079ee797b16e1a6a26615ff0927
06aec32ac9d7dc58baad096929899540da4caa0f
6345 F20101221_AAAXYQ leesamphandh_p_Page_16thm.jpg
6de473969c3f63816a034703a24c3510
919683522c5a2fdf5f84bde1b8e417fdcd5cf1c8
938675 F20101221_AAAYEL leesamphandh_p_Page_47.jp2
6e51193b1c2c31b65ed039c908f93442
41db1cc06bac7d940d4403d20a9d6a2028496e17
97294 F20101221_AAAXZF leesamphandh_p_Page_78.jpg
9812d1a834f879d1162f54ba4fe1ad2e
86b3ef90ec3af2406aecc040b11051a17d512947
914992 F20101221_AAAYDW leesamphandh_p_Page_30.jp2
70684546fbd6ed22ae7693aa4dd7afdb
110bd55eb40653f6a024b875afa0487d65b09d15
25359 F20101221_AAAXYR leesamphandh_p_Page_84.pro
9ceb3d40fa2768ef480ddf366c970073
0d96df4d001bed6523298958b95507e617afca9f
1051936 F20101221_AAAYFA leesamphandh_p_Page_62.jp2
50e64e331c2fc8f95d30f227d17ac943
f0b430a59cd0d0e643c526ee787d2cf5d5fa8ef9
948323 F20101221_AAAYEM leesamphandh_p_Page_48.jp2
68215cfe16f4102e27995ced25855e87
a381f71b0bc2bfc725e903815fa23e644e054988
884294 F20101221_AAAYDX leesamphandh_p_Page_31.jp2
1d191a4438d3609ca5dfcc577e6eba0a
f4221c18b7e4e53dddd403e62ebe16484de1abae
783549 F20101221_AAAYFB leesamphandh_p_Page_63.jp2
f65a79d7462f207a603d6289fbdc12b2
42823df145dcdca75b48660ed88f75300a050e78
1029098 F20101221_AAAYEN leesamphandh_p_Page_49.jp2
f5a7858187718df77327a3608cad9dad
02bfbe3d04c9c3e24acce905194b94d58da0cb8d
35789 F20101221_AAAXZG leesamphandh_p_Page_26.pro
cabfdc2c384561bb15b57458d22203eb
d6b6c05b4589b76eff79b694a10189f27ef823e3
822650 F20101221_AAAYDY leesamphandh_p_Page_32.jp2
8337d99168d6f262e1255603d2379d3c
fa2642ae6402cc2abc7acbc42c0a7d5cfba26348
26818 F20101221_AAAXYS leesamphandh_p_Page_39.pro
9d6834b4b51532d8e35e14de919571fc
34c51eba361f036293e76cb7dd851a67fec641e3
1051952 F20101221_AAAYFC leesamphandh_p_Page_64.jp2
aadb49ac8ab80533490e738c4c984336
a740ce2b68901eb2e8a9e35cbe998740ce4489a4
771392 F20101221_AAAYEO leesamphandh_p_Page_50.jp2
2409cf20bcef9d4a55d221898c635dd3
7e12752d93af693612a9a3a1e25fe0c17d72ffee
F20101221_AAAXZH leesamphandh_p_Page_15.tif
e19afcf019eda55b03d830c88a2ee3b6
88762f173a4fbe93d24246f47a9ee08d208d9aac
1051946 F20101221_AAAYDZ leesamphandh_p_Page_33.jp2
9f4c27ef1587f5bfd333ba8c7fb365cf
b6465dff16a8d923f2b7ca78356f14546b30577e
31571 F20101221_AAAXYT leesamphandh_p_Page_87.QC.jpg
3bb582a834b64be3548441b6e7e9b19d
05616afc7d13b8f70c8773c19ebb2f1bfe7f7f37
1038896 F20101221_AAAYFD leesamphandh_p_Page_65.jp2
b5191616d8872ee396b9b6aaab87598f
cefc941911210b5cd9c4cb412a8099efde8b153d
867461 F20101221_AAAYEP leesamphandh_p_Page_51.jp2
26a93aba5ab797c3ad2a206881495cf5
53bf2fcf07c83b4f9327860161dcae3f3bc21a90
1051981 F20101221_AAAXZI leesamphandh_p_Page_76.jp2
01681fad7c3337d707ba20af0638f41f
74543f3ecee8f201afe1d3c99df4ae397c17a64c
F20101221_AAAXYU leesamphandh_p_Page_60.tif
e0e490f58e4988e286aba94143f4de05
fdf8f1735a921f93e79b287a7f5444877da5ca65
980700 F20101221_AAAYFE leesamphandh_p_Page_66.jp2
d48e079e47f5381399233fbb207774cd
4f118a88b6b77a34af52bcd9ecf8b03ee8264179
33348 F20101221_AAAXZJ leesamphandh_p_Page_62.QC.jpg
7768ccee6a625bd212c5baebc25df3af
9be0bb3d0db4ed8b393a56d7001dd752d6a0e96b
F20101221_AAAXYV leesamphandh_p_Page_38.tif
582d66e570ed53be45e2385e307cd0ea
3fcfca34d94b78a61d919c9e2c57a79c673fcb16
829972 F20101221_AAAYFF leesamphandh_p_Page_67.jp2
36b0e47c64fb0830d5c9bd8e5dac6fad
7b63aa85bf875a9fb2d833ec5ec26f5005520d32
900629 F20101221_AAAYEQ leesamphandh_p_Page_52.jp2
7c88d44e3b0f8c4251c7e5e3ae31c780
4c88c7816c3a0ba8f1d97309d79028ae2395b031
F20101221_AAAXZK leesamphandh_p_Page_81.tif
30197db2ac4d05accb6a0653148bac71
09f6a758c42e050320b04b0c448971d376e7d0ae
1860 F20101221_AAAXYW leesamphandh_p_Page_55.txt
f1a94a65edb30098a42e61e708d14c5d
5e766603dc2bc2e61c81f61011bf825034800f43
1043632 F20101221_AAAYFG leesamphandh_p_Page_68.jp2
8ae78d7d2c4a3fe350e535dbc9985214
eff615ad23ae662fd3ec2a10914a85715d7a1e52
820088 F20101221_AAAYER leesamphandh_p_Page_53.jp2
3a744e86beafeb08fe5b540a1a86926b
e6a7b2c82f38088646ff84cddfcc0bb522ce931e
8797 F20101221_AAAXZL leesamphandh_p_Page_13thm.jpg
25e72c41cc37dbf73f18c1ef7d6ed8d9
a99f323b6615c8c0cc769f1d6ee878aaa6bf3fad
43329 F20101221_AAAXYX leesamphandh_p_Page_08.pro
307be905edfbac79af1875a9b8c33f8c
771ffc3c0ac28af0e2ecf235ecd22847cf4f18df
760526 F20101221_AAAYFH leesamphandh_p_Page_70.jp2
27908f2d13bcc5bcedcc65d0cf4fe2f8
0531bbb369499f554ae213109f839f42120be273
996200 F20101221_AAAYES leesamphandh_p_Page_54.jp2
99c54b2b4c88dd4877ef23da230e5740
91ff72bfa7c06eda4dd48323c4f1b2131cb18523
6723 F20101221_AAAXZM leesamphandh_p_Page_43.pro
5fce2416032df0d2cf41670141b8a75a
fa0ce99e47efbfd8de64f601ae2807064bc88069
33165 F20101221_AAAXYY leesamphandh_p_Page_18.QC.jpg
af828128afa80c68b4c715b99c0294f2
7c95fb3ead6aef66fb4c05e73ec5357a383f5096
883954 F20101221_AAAYFI leesamphandh_p_Page_71.jp2
448044b3124d03a10453fd2659fbd728
07c62143a9793c23a9cd4b64019185807d37fd4a
956824 F20101221_AAAYET leesamphandh_p_Page_55.jp2
960c78407cbb8733cae8e732c2665b0c
c6fca3195f495eef421bef703c0e1f6c47024144
111651 F20101221_AAAXZN leesamphandh_p_Page_61.jpg
686bc4092dd710d516e0818463b1b665
3c3093553821be34acbb02871abb1ca939cffa36
85447 F20101221_AAAXYZ leesamphandh_p_Page_30.jpg
da6dc04895500e631949c3bd7d1538f9
b969dc65e42b20b0dad30cbec88c7a265de601e4
911494 F20101221_AAAYFJ leesamphandh_p_Page_72.jp2
ab62cd77d80d292eb39b0869aeec4fcf
f72d061fd2b3d4b8ef94d99e72c3ad86f5fd8465
1051959 F20101221_AAAYEU leesamphandh_p_Page_56.jp2
7768d8dbaf1b2bda61c0ab15a1d06da3
b6f02bc143274f3e1e9c2c367c2b0f017ed0845c
21806 F20101221_AAAXZO leesamphandh_p_Page_41.pro
dfd96d9443f2283ce2010959de9f7352
2dd34ce47a817ff22926da09acc404b1044e0fc5
780503 F20101221_AAAYFK leesamphandh_p_Page_73.jp2
898723ed1d7465fb4c8e5ea6b1c32610
077b4b73c037851ff16cce4269b4076a54f85091
1051979 F20101221_AAAYEV leesamphandh_p_Page_57.jp2
7011d6b9023211f339c2623f9400df9d
9ab57a26c282295bae3482118e2686c36f8422b3
26042 F20101221_AAAXZP leesamphandh_p_Page_53.QC.jpg
10e2741695a115bfee630194307d2a88
7d9a3a1742cba92bd7be3e10b871c32828b3fad6
945265 F20101221_AAAYFL leesamphandh_p_Page_74.jp2
5afb5285fc7e591f0e8d18b7fc987538
e7aebcb34a0839107a4bfec8b1a48e77c65bc456
672471 F20101221_AAAYEW leesamphandh_p_Page_58.jp2
2e30f3b0aa635bde41a017443249a327
66a22134077f959071e1b56d1814f9442fae22ae
7617 F20101221_AAAXZQ leesamphandh_p_Page_24thm.jpg
e960425b44399c4faf90aba47c8fd3ed
f36fb9e2b6da3f0a0bba4cf3f43cc71966c420c2
1051980 F20101221_AAAYFM leesamphandh_p_Page_77.jp2
fcd0ade12816ec0323ed49b400830643
f27b924a71416a48ad5e6ad45a32b6c5c106959e
115714 F20101221_AAAYEX leesamphandh_p_Page_59.jp2
cc51ad53cb26179fdbc8f5317e71bfe1
b874e87650bd05680a66d665769f19ab952e1522
1739 F20101221_AAAXZR leesamphandh_p_Page_29.txt
931d1ada68641a41ca820f581ecf5bce
86371af414d897d6df5e3e99c1bc66b74f9e93bf
F20101221_AAAYGA leesamphandh_p_Page_10.tif
5fab99a0bcb7750b671f0e2231a0cc62
0906b8b72c22abdb532c384cb4d522268b63c560
843965 F20101221_AAAYFN leesamphandh_p_Page_79.jp2
c17547e4c4d677d85d05d9a5e9e6b7b9
a8cfd0628ce2c71f8bac5e3e60f1cd68a1406ac1
1051964 F20101221_AAAYEY leesamphandh_p_Page_60.jp2
6686507f3cce241cdf10633ddc51818e
da1a1dc4cb8f5871be438dfb3bc6670bacadab6e
52581 F20101221_AAAXZS leesamphandh_p_Page_91.jpg
8174ee04dd54ba2c381e4bc0d0f9a894
9cb6063fabdbb75abb1cc4fb4f98938cb96ff77a
F20101221_AAAYGB leesamphandh_p_Page_11.tif
307474a04649d09498d0764fac553389
9db22d63cdd0f6725ee16adcfedcb13af54d3bea
659980 F20101221_AAAYFO leesamphandh_p_Page_81.jp2
cdda67d45962086191a30c7fe791d403
c0f5c9fd92011d314e6dbaa4c283bc8b05c4d87a
1051957 F20101221_AAAYEZ leesamphandh_p_Page_61.jp2
436e2728afe4c41b4765a64a85d0b813
081d309017ad31876c963cfc2d412a9be50cd14a
31813 F20101221_AAAXZT leesamphandh_p_Page_78.QC.jpg
55399e645250621cfd2ad9b0677738c1
c2a70ea55d7209b5189d841961e6db4d6fada424
F20101221_AAAYGC leesamphandh_p_Page_12.tif
88d895dd2eb839bec059f64bbb17c1bb
14eda2878497303cc4af5319e68ef3aa51a651cb
548382 F20101221_AAAYFP leesamphandh_p_Page_83.jp2
01d396d6a0264b1e742b7f15f88d721c
e4d7f97bcd30f877368ae6aa1e6386eaebc37ba1
9197 F20101221_AAAXZU leesamphandh_p_Page_85.jpg
b123f6896b4e71bbe92c190b5d988c8d
b02cf5ef5e6d144f84da9e377d3128998099e677
F20101221_AAAYGD leesamphandh_p_Page_13.tif
babdc448ec1c6e50546b7d647f5bb585
adc093fdf73470bbf9207f3b32a0797b5a063519
29131 F20101221_AAAXZV leesamphandh_p_Page_08.QC.jpg
acb585bec9ddf446793cd479d6ccbd0e
dba9b26d9945e320eace1bc1c53c27d7963a46b6
F20101221_AAAYGE leesamphandh_p_Page_14.tif
6d419cd8b562d1ae26ea58f4b3bbced8
4779d091e9c953f2800e5849517bc8565af685a1
70996 F20101221_AAAYFQ leesamphandh_p_Page_85.jp2
240e72840db7953b6ec4b1b1c2ea79ef
3ae6d2d6d39b97c51c3a8c54c362b2ac9de811ac
26362 F20101221_AAAXZW leesamphandh_p_Page_25.QC.jpg
af4cc96f22dc682f0ff1e91272f73660
5403d8eafa704f0f45663ac93bf82088c064d99a
F20101221_AAAYGF leesamphandh_p_Page_17.tif
ba7a8beaa0072492c549fb679dd8dca4
3c0b5a8279280ebf754b1874ba71839435eb5293
5290 F20101221_AAAXZX leesamphandh_p_Page_58thm.jpg
dd677832f338c64a85cdc51400d1b205
207f87f2ef558e4ebbc4d9408f29f3a564899263
F20101221_AAAYGG leesamphandh_p_Page_18.tif
aab361c63ccebc1e2b1e26792cfe3a2e
e0195a37aba395124a3c540577b7497e34f06ef6
199453 F20101221_AAAYFR leesamphandh_p_Page_86.jp2
d91d5bb579e0781d43e87e9ed7d2854b
c5c87f2d9d60463bf2f46abf280ede577a998d86
7077 F20101221_AAAXZY leesamphandh_p_Page_73thm.jpg
4d42184f4289798e3732efca92030dfe
7f98f477fb2eca97994bc03dd9aea1b039c9ac4a
F20101221_AAAYGH leesamphandh_p_Page_19.tif
6ed9e3fd247f71f0ef3fa9ca51da4fd6
ba84ad10c8c331ecfbdd6277a52a39d37f85a13e
F20101221_AAAYFS leesamphandh_p_Page_87.jp2
4b0c9fc96a8dd5454f629783f96aeba6
a2cb9e980f53e8d5418564d5e3930263a94b6faf
F20101221_AAAXZZ leesamphandh_p_Page_43.tif
0cc7191bdcaa903deeb139745ec35cbd
382c49ec78f1753b8e0650ebca59ffc4ad62e5ed
F20101221_AAAYGI leesamphandh_p_Page_21.tif
c8b7e477a634b44d36c9d3b02336ba76
985b260607ae8fc2cb60784297a41202ac29b854
121253 F20101221_AAAYFT leesamphandh_p_Page_90.jp2
573b3ae5f5d8d4f7953c125d5e356edb
0487dcea626d024dc9b37c89d34bff5ee2995af3
F20101221_AAAYGJ leesamphandh_p_Page_22.tif
b022da9c445c4ab6c2f07fed1dc17edd
39230823e2791a694dbdcf911d1dabfc3e9e8870
549252 F20101221_AAAYFU leesamphandh_p_Page_91.jp2
772b6f27c1cbd4ba6b99bd50e300689f
1d99a1d2a04cc913377d7f22274255a2a5c42f01
F20101221_AAAYGK leesamphandh_p_Page_23.tif
df28c2d40577074612369e89e46a79a2
7243eeecd2b3c0a4de0e306f95950049f068cfcf
F20101221_AAAYFV leesamphandh_p_Page_01.tif
61e9875e1dd2093a4027c4e35eeaac81
683f3af43af0228f343c8669644172e407efc395
F20101221_AAAYGL leesamphandh_p_Page_24.tif
d4e66788eda9af00bc883edab8b21716
6f203d884f6f3039b174330e88c4ede2a756df2a
F20101221_AAAYFW leesamphandh_p_Page_03.tif
ab057ef71ee5cff2de5786beaab256e2
0f18ed7860aeeac7bdb7b878b2e2b3541d5a9ce8
F20101221_AAAYHA leesamphandh_p_Page_46.tif
15f8f06a9b757473abbaad1430e7304b
eef5e065576b63c792abf70c895920be270b7527
F20101221_AAAYGM leesamphandh_p_Page_25.tif
a0da00eb9018077d101b5a1488332e2a
baaf4356db45a9040193db09970aa303d1ecb5b1
F20101221_AAAYFX leesamphandh_p_Page_04.tif
e08b858473fd1aaf2d374261ebc329a7
184ea4a34058ea9a202d78e5bc3dd4fa47610553
F20101221_AAAYHB leesamphandh_p_Page_48.tif
62cc0f8f1ccc3cef23a6adc8f8833eb0
8eabcbaabf6e36d1d72301bdd045e4f2ecc26572
F20101221_AAAYGN leesamphandh_p_Page_26.tif
9ba912f7fef071d7f714226ddaf8c796
d4e6adeaf659c2f7d686e36301d6b0416f130e9b
F20101221_AAAYFY leesamphandh_p_Page_06.tif
1c8cf9b642f9f3acf27d0cb0a554ba8e
3bbc4d5f09cd12dd8bee959731a17a2c7623e5df
F20101221_AAAYHC leesamphandh_p_Page_50.tif
2260276515755d396e1c5d7cca68821c
8e43465744ce60eb017b7222a30465dee9c6619e
F20101221_AAAYGO leesamphandh_p_Page_29.tif
49a092d743f000ee593f93940e2a4c70
6b2669c4785f2a92088d13d6dd0721432e5834a2
F20101221_AAAYFZ leesamphandh_p_Page_09.tif
538a7fe4c4e0a237c373f1893e16aeae
0638e0cdcc02c0f825b150b4b1aebd4f0d833d38
F20101221_AAAYHD leesamphandh_p_Page_51.tif
11712dca84577fb1a1d82b40ee3e574e
75133f2017c32d3c0c5ce45ab7d9777f24c9c1c2
F20101221_AAAYGP leesamphandh_p_Page_30.tif
13a37964eada584140a6e6f21bfc5129
7aef8ab3389ab2f12949c0ad796c77f79210822a
F20101221_AAAYHE leesamphandh_p_Page_52.tif
3ce22a898b367ad140021a4b75508651
7474fd89de7e7a3f40d6880c0fc7b52d19b73662
F20101221_AAAYGQ leesamphandh_p_Page_31.tif
b91e952738ebc95f4d185b4e86e5c083
4832aacb4aad0341246f019a4b3664143fa2f7f3
F20101221_AAAYHF leesamphandh_p_Page_53.tif
7d9c59635ac4683c8ea22255846cbb70
a636cbd982b87a093fd728cf7cb41f0d2e638bb6
F20101221_AAAYGR leesamphandh_p_Page_32.tif
cc52c6349db5c81a7d48956e6704049b
89589d9879ce4202a906bd1dcb4063dca4ca2c6a
F20101221_AAAYHG leesamphandh_p_Page_54.tif
8f6959d7521532a73ab3839968c6b124
ee17558898f547add291b229915fc35ee7f67e0c
F20101221_AAAYHH leesamphandh_p_Page_55.tif
90546f883851c100d040184dc52a3856
7718db10c62c11f6eaf4350063f88dec4a4d71da
F20101221_AAAYGS leesamphandh_p_Page_33.tif
c8a7df53fb25420db63f3f991d03c8b6
4c42fbafb96a4758b1aecea01efa82cadd303663
F20101221_AAAYHI leesamphandh_p_Page_56.tif
5fde7ed2b68b087c0f58e562ae234805
c097ebb194f30bd8096a5e0bd1fb2c3bc8a2937e
F20101221_AAAYGT leesamphandh_p_Page_34.tif
fd6a8dac8914a8871d2cd0b7e1ad3137
f130f9d9c2b0ef4d1bbba284abad638c86ce58a3
F20101221_AAAYHJ leesamphandh_p_Page_57.tif
2943bb7d28037dc4476a3186ec0af403
000236633e6105382d6ca95ea5c9f93e805706f6
F20101221_AAAYGU leesamphandh_p_Page_35.tif
9679e1a37b337bd3e2bec4f4453635f6
b69d84123d624f44a198fcb4fde7be40bc5d911c
F20101221_AAAYHK leesamphandh_p_Page_58.tif
8f15ade55368d5ded86f0ac385bbbe64
0bce53ebe0178a4cfdaca0f769c608e62ec9ac4f
F20101221_AAAYGV leesamphandh_p_Page_39.tif
85687880dd203afa36ddf8abe212c1d1
2284a45fd855125b6f9003f22a2c138d346f14ce
F20101221_AAAYHL leesamphandh_p_Page_59.tif
00c1e5ef5ecf4f280485963eb36219a1
fa36584141353f010cc2527a8ac3467e24143930
F20101221_AAAYGW leesamphandh_p_Page_41.tif
ab0a40fb34b4a1f715ccbfff05960ced
6e3224b177c689241f85b0cb921fe1f9162bedbb
F20101221_AAAYHM leesamphandh_p_Page_61.tif
a6b00a915d14edc72722124cf13edeef
b02f1c727bff5726c2d99c2d6965e33bdd196a23
F20101221_AAAYGX leesamphandh_p_Page_42.tif
064e08c105ff0a00e8f5698c247c467a
b72201dcd48d7653393fc4f19eb3a3f6d0ae95b6
F20101221_AAAYIA leesamphandh_p_Page_78.tif
21b6e23fa6fbc4830f29dcb8889b8335
d016e7f8cb3acc056f43a0be6958ba9c2864d29e
F20101221_AAAYHN leesamphandh_p_Page_62.tif
0f1d9ca6d2c106da3dbec6c77161e991
66d1c2b6a750f83c562adb912fe39d053aa439a7
F20101221_AAAYGY leesamphandh_p_Page_44.tif
6c08f9926f85ad4435e359c4fa39200c
9e34398628a7ae4f8fc0223fb21cee973af5a0b7
F20101221_AAAYIB leesamphandh_p_Page_79.tif
f73fb3e6e73b64a30c306fab38a96b5f
00a710962685f7d8e5e8287a7f30ba78f3f30852
F20101221_AAAYHO leesamphandh_p_Page_63.tif
be415d402fd72e56f2b61ad0dc0a01ed
ffe8395e72e5286a06ddebfd858188cbead0c94f
F20101221_AAAYGZ leesamphandh_p_Page_45.tif
26cd4b95df21f732acefd5f3acd285e3
134299c149c8ea6589ef4e2d78209f73b905bd78
F20101221_AAAYIC leesamphandh_p_Page_80.tif
39a07c358db06d56b33fc46380406d6e
ebe23a2c3c78a521b2eb21c4f276f008706b02c1
F20101221_AAAYHP leesamphandh_p_Page_64.tif
2688deb27c83331387077debc2792eb1
a12522c075c9a3c95cad8b4a5639cf198465f92d
F20101221_AAAYID leesamphandh_p_Page_83.tif
0a64385af25da750076c7bd160975d80
7064a28149d0f0ccbbd641a3c4eb6dbcea7579ab
F20101221_AAAYHQ leesamphandh_p_Page_66.tif
d06cc018903f7f30a188a9ed5f7e699d
31ec9a61d03c2bd256cf06f77ae81fbcd1ca6c61
F20101221_AAAYIE leesamphandh_p_Page_84.tif
093b142b4c2ed84ff015ce29c6b01d76
22c6f933dd6002499056d34ca66114074e677c19
F20101221_AAAYHR leesamphandh_p_Page_67.tif
e5e551996eeedba20f384fe53cd7410d
ad4df2b836cdc78bbffc061a692b102d6685c20d
F20101221_AAAYIF leesamphandh_p_Page_85.tif
52265140ef419f105f7f704f2d2bc541
14f57955ea11993e9b870a77fa2643d4f2545b07
F20101221_AAAYHS leesamphandh_p_Page_68.tif
78ce03f0a049d1f1104992d8b090c3fd
88f62ba44ea8e2b34d6fc3696dcd4c35e9be0533
F20101221_AAAYIG leesamphandh_p_Page_86.tif
7cefd1f1eb5e5d204ccc48d4c0eac273
82d852f5d469279649f8051fedee8b84e454042e
F20101221_AAAYIH leesamphandh_p_Page_89.tif
59721ede82ad658d6c33f4b675b0b78f
c0c0740a5c61cd92064042266653e9a26da260f1
F20101221_AAAYHT leesamphandh_p_Page_69.tif
4660e760c92f58dcabc3db308154260e
710bc8d853e7aed32973589039d13ac1a63cb8ec
F20101221_AAAYII leesamphandh_p_Page_90.tif
33542049dab5abcfb9482c4aebfde0cd
e55bc538b2be194ad9dd1d795617d4e7c27b7418
F20101221_AAAYHU leesamphandh_p_Page_70.tif
b046756bc623b41802030e9e87c3d4bb
7f9173ab7769a2a9af400504e1eb700403f413f8
7400 F20101221_AAAYIJ leesamphandh_p_Page_01.pro
5fbc95c7f8dd3096ee2af84c302406bb
3d67818139d37d41360eb53b2604fa10ca164b92
F20101221_AAAYHV leesamphandh_p_Page_71.tif
284a1655600d014df6450df9cccdbf10
edbe5cb4a6dadd0525ea727e64c2900ed556e188
991 F20101221_AAAYIK leesamphandh_p_Page_02.pro
04a9ebff012c14721ab3422e021582bb
dcb98b56c800d8aa261811782ecb66515f5c05b0
F20101221_AAAYHW leesamphandh_p_Page_72.tif
6c5cd7dfae16d19ba4f2dbc10b530d45
921f3dd1a4bea815986431bda808dd1d56c4587d
1719 F20101221_AAAYIL leesamphandh_p_Page_03.pro
9ec79ce57b86f9ec6267e185eb0e509d
d343b30ac40556a582a06fc0f9183c8a1a6efe0f
F20101221_AAAYHX leesamphandh_p_Page_75.tif
143b98eff6659ee55e2a7490f7e5bf0c
1fb9eeae6ee902b40f4ea25a12486b89eea55c1a
44565 F20101221_AAAYJA leesamphandh_p_Page_22.pro
24fc84e4a663d71918762ceb4b489e5c
edf5a8c90d10f38317099bff75700074073b5142
39273 F20101221_AAAYIM leesamphandh_p_Page_04.pro
ec4e6a7ad33831e187d2071a75c0d5a6
e5b3c9cd79e794e0da7df8d3c01c06c3801acad0
F20101221_AAAYHY leesamphandh_p_Page_76.tif
ec5897e3d079dad73c36344f7f7b0332
1f0d9c1b1a8626c8d713db1ae23ed0546adba5c0
38144 F20101221_AAAYJB leesamphandh_p_Page_23.pro
2c1c846bfa068a48b73e638beb954763
b0b72f59be30137f01d0d33f385369f932556a78
70460 F20101221_AAAYIN leesamphandh_p_Page_05.pro
e952ddc4edf43366b9acb9a6a54f9b34
46e045758a5e9cfd080f7c1d102a824f731f7463
F20101221_AAAYHZ leesamphandh_p_Page_77.tif
7813f139df3a9d907a966f1574335f80
2d283d12282d8af5c59f579a6ba5af77367ee338
41221 F20101221_AAAYJC leesamphandh_p_Page_24.pro
474d3e2bc57cbdc89471197cd4aeb16d
d5fc80f351ac557f04ffed178bc719cedfa74170
21890 F20101221_AAAYIO leesamphandh_p_Page_06.pro
fccc4e1916aff1c2dc26fc5abb322f19
0d6cf1ff340bc8fd9c6fb0cda3f1e433a98cbd1c
33850 F20101221_AAAYJD leesamphandh_p_Page_27.pro
7ac1f3181d89e66604d1279d7fc1908c
e3abedd1063a1da0dca318fda27997515ca3b1a3
52308 F20101221_AAAYIP leesamphandh_p_Page_10.pro
c89b993d969adc187d9693c1028884b9
ddc207156e0e7bef25d1ff87bc14addd8cf31347
44769 F20101221_AAAYJE leesamphandh_p_Page_28.pro
c4db5ef2921d0ed031bce716280185a0
69f23c4a3d11b2914dbc995d4f5a9e50d5ab5dcf
25935 F20101221_AAAYIQ leesamphandh_p_Page_11.pro
d681ce8be147fb010fb1b2838a20ef98
4dc8079643cf1b3215b0cb0c6ac2489f287a4ceb
39635 F20101221_AAAYJF leesamphandh_p_Page_29.pro
f22cdd3aa8c3f0bd3cc87fe350983f2f
a7d2541538d8ef06d190eaba6db9e04aadcc67a5
53639 F20101221_AAAYIR leesamphandh_p_Page_13.pro
f174431d9183904ce9cc6e5d2826dd49
65646983043e41b691c7a5ef343f0b3f21f1531a
38989 F20101221_AAAYJG leesamphandh_p_Page_30.pro
65272250f3a6cb0c51dd0463a1333c62
c51a58380044f27a8f5c7edc0b0dc68dac358848
50892 F20101221_AAAYIS leesamphandh_p_Page_14.pro
933a97745d15d11377c4c9790c9864d3
b475c2a4f01d79fd7dfc7fe9108942de6f817e2c
39628 F20101221_AAAYJH leesamphandh_p_Page_31.pro
ddde3e8d4d5e2fa7d977c2d12d387322
67e342be3fb749a542d154f3b0715b0d0e1d6676
43860 F20101221_AAAYIT leesamphandh_p_Page_15.pro
83a7d2ac95226a594d3b4d2b8873453c
18d7b1ad7b2205d874e094c0adf45130502a69a8
37569 F20101221_AAAYJI leesamphandh_p_Page_32.pro
d240b2cd869ec177242cbbbb7ac14f22
66c10e02eb1b7bf7ba8d41fa0d05e35f728070a1
52478 F20101221_AAAYJJ leesamphandh_p_Page_33.pro
c545e354a759ac9359ec163df4dd5d20
2d9af058b93548cffc02d28a45afb92bb95c568a
33649 F20101221_AAAYIU leesamphandh_p_Page_16.pro
86e2e12ebbebf9c554ea3d698e7632e4
0eb784d151ddf07f020e51ca8c53f2ecd0a20fc7
43545 F20101221_AAAYJK leesamphandh_p_Page_35.pro
b13dfd16aacd51012f944b988c025209
b3a4007680dcfa60fd06676b5e2e86e43e181334
46488 F20101221_AAAYIV leesamphandh_p_Page_17.pro
853678e5e88adda0170c3fd86d8a9624
14e7fbc6dd6c435da50586e7f68461a6e682a5c2
47219 F20101221_AAAYJL leesamphandh_p_Page_36.pro
a531db972e7ee12f9fc5d7b3dcfd40bc
bf93d40485a7c6837063ae1d4815881d33f53afb
48435 F20101221_AAAYIW leesamphandh_p_Page_18.pro
749f6d44207cf261a1c952969a8af62c
bfe68b7322c227cb26c183c3fee5f766e2573235
47936 F20101221_AAAYKA leesamphandh_p_Page_57.pro
b4584a66a54b17a374a1bd3c4ceb41e4
8fcf4cafdf83162022111bf6867ef698b2931432
38174 F20101221_AAAYJM leesamphandh_p_Page_38.pro
659768d91c67ff30959bb7ffd6db55ca
08892cc915169c760bfda817ead7d062dba28f99
43250 F20101221_AAAYIX leesamphandh_p_Page_19.pro
474f11f3c9c12a24eea4960f64607390
191e3ce2c5afc71f13b6cdad133f427c481e9481
29759 F20101221_AAAYKB leesamphandh_p_Page_58.pro
64383219ac2a475561d8cca4a0cc8322
854c3ff75e0300120346d3e20734a8e0f1bb4507
23346 F20101221_AAAYJN leesamphandh_p_Page_40.pro
b769c8d79c891238f953d438df6bbcd6
812bdd07f37a9b6301453670b388f549416741de
39034 F20101221_AAAYIY leesamphandh_p_Page_20.pro
a44b38998f740ae8ba09756bc7e3726b
714ec53b67216215b60d240367137aa8c4413879
3206 F20101221_AAAYKC leesamphandh_p_Page_59.pro
fb025c1f71821bbb565d22dd443e5c37
c887ebc3d15c3ce816f1954c41b9b664e50a6cf1
17786 F20101221_AAAYJO leesamphandh_p_Page_42.pro
e378e1e0a8d58bf13bacb5c49fe34995
d48403f4cd8f40bef8860b217d52d111f4e2da82
41965 F20101221_AAAYIZ leesamphandh_p_Page_21.pro
46305ec0d439d5c5810e4ede8d75f5c9
e15073f3065fa94b92cfff51250e3622db7c96ad
54514 F20101221_AAAYKD leesamphandh_p_Page_61.pro
4f68087ddd83a619c6bcd2fc16b3199d
d305caf6c85f4dee1fb8e0e8c6b98997e2a077d7
52807 F20101221_AAAYJP leesamphandh_p_Page_44.pro
16fd9b6c961c59fef0ead2aa0c8bba15
01ae9a700a8626288703433c9de52ac385cf513d
48236 F20101221_AAAYKE leesamphandh_p_Page_62.pro
6a5e036ddb84bcf2e979b49aa111f792
bbf591903400f468edc394d06b58d6b537f74b63
50417 F20101221_AAAYJQ leesamphandh_p_Page_46.pro
cc786e4e4e14f15a81ae4061d0930a25
1f4e33190370c2ef83bb8bc3d118063c2ea34f94
35773 F20101221_AAAYKF leesamphandh_p_Page_63.pro
f7b756862f964afd22ef85833d208f78
d6f81d938fe049505fcaaec822a9abac4aa814b2
42861 F20101221_AAAYJR leesamphandh_p_Page_47.pro
59777c7c5e7ad4785d1fd0b69c1d0db9
7b9e141af813f878f0be2b8bb47b1963cb45dbf1
46945 F20101221_AAAYKG leesamphandh_p_Page_65.pro
187b7dea6d3b9ea98b3c9a9b637069ad
749764f9c7686165ae61dee31a653c28993ae007
43044 F20101221_AAAYJS leesamphandh_p_Page_48.pro
137297d326f4112f37a08277790da0b2
0b25a481c470421769fe99eafe03b18ccd09dcb7
44598 F20101221_AAAYKH leesamphandh_p_Page_66.pro
5eae6eface8c66c958fd9119b5f100f7
73151b16f6039df88151397612b2f43caafd031a
34107 F20101221_AAAYJT leesamphandh_p_Page_50.pro
55ff56e031d1dba738c0a8a79446eca9
5bfe409599c01104728cc04a402659fdff4e6dca
50987 F20101221_AAAYKI leesamphandh_p_Page_68.pro
7967a4eaf439353f13f9080448d82855
344f9324b8c29c555050c5c4a5ab99b8ee388fb9
39888 F20101221_AAAYJU leesamphandh_p_Page_51.pro
c8bad227c9f85c83094cd98255867ad2
d7cf9bfc4e5178c853e669a389ec97f1f4a9ee1f
33519 F20101221_AAAYKJ leesamphandh_p_Page_70.pro
93b555b784b6b4dc33c54338f847e9b1
11f9bf7ed4d9463c08628530e28553663734d598
38665 F20101221_AAAYKK leesamphandh_p_Page_71.pro
764e273dd00238dbad7608ac9808851d
3f3998920bfdbe586e97c725c5b8855b871d47f7
40465 F20101221_AAAYJV leesamphandh_p_Page_52.pro
4b55ccac73bc627abf50df0aa1afbb11
0d78f95acbc8e2a5f6bdc73f175508f915497265
36928 F20101221_AAAYKL leesamphandh_p_Page_72.pro
0c0e24268aad14231613a3dc8ed3acd7
328d82dd45a96db37667127fc4ef4ab6ee749fdb
37356 F20101221_AAAYJW leesamphandh_p_Page_53.pro
9afdaec5b0dcdfe1ce06951fe190d3b2
d16c7115fed00f5772902a1c859e17c699040817
31948 F20101221_AAAYKM leesamphandh_p_Page_73.pro
4fd2bb2b3a3f5c313f47619534318a21
5b7516148720ddfe9224138a421a664ce6bd5001
44348 F20101221_AAAYJX leesamphandh_p_Page_54.pro
b98cc5a63820498976fd015f342c0aef
4a7fb6c16a89620bf924d8273d4b2c8e3d1ea4bc
92 F20101221_AAAYLA leesamphandh_p_Page_02.txt
a0d45bca9c9c3394a9af99a9d1344874
c477f5d6d0034a2d3a3d6294e1b94be3871cda9f
43462 F20101221_AAAYJY leesamphandh_p_Page_55.pro
5841d1a900de479daaa615fe1c831897
85561f2dff0cd9e4405ca6c2d05da76deca123f0
124 F20101221_AAAYLB leesamphandh_p_Page_03.txt
65e538657596e31a1f93a25962828324
ec4508005b4e08d17a8a2bfc83be59b94b3747e7
41960 F20101221_AAAYKN leesamphandh_p_Page_74.pro
0f6f3d103fe2663a6994f98a62c274f2
1c306e7d3e5b3533f3e474123df1c2a41c8d1f9c
47175 F20101221_AAAYJZ leesamphandh_p_Page_56.pro
99bc735cfa85304e644a212835eba05a
25742926aaae844acc6d2e372eb289949881d453
2988 F20101221_AAAYLC leesamphandh_p_Page_05.txt
33da49b91c23d4c9fdc066129d45b1ef
14d1cdc4b5736ef6b60c48ec00eaad77d96e918e
51955 F20101221_AAAYKO leesamphandh_p_Page_76.pro
05bf93f4dcd7941bca5d29c0a68928ea
f39ad6fec85cc814d072a4737f85911979224b79
558 F20101221_AAAYLD leesamphandh_p_Page_07.txt
abec99ff4385bf07e69c26b63cec7286
a6c280dedf4050fb25e649e21af92fddc8eb8955
51878 F20101221_AAAYKP leesamphandh_p_Page_77.pro
2c29b5adb90efee738d51dc6c12e5142
070ea635a8b9eef9412595258ec6d0d2a9543070
1896 F20101221_AAAYLE leesamphandh_p_Page_08.txt
9f7680e673df3fb907cb07c4f91063c0
35a71fc609b02ca59ecd0c8b9a7223798cf1cfee
48449 F20101221_AAAYKQ leesamphandh_p_Page_78.pro
03fd9c6401195a924e4af0a8dca424f2
24a47fa428b665d980236606120182fd63510d0b
975 F20101221_AAAYLF leesamphandh_p_Page_09.txt
1c53864384b1025d510efa720695c487
c94d7c972c33d2d9e7de913e240b10fabd129300
37177 F20101221_AAAYKR leesamphandh_p_Page_79.pro
15f5f928cf60de073ced056a85b7e2dd
aac49883fbf182a22a0626e008dfb84311043410
2136 F20101221_AAAYLG leesamphandh_p_Page_10.txt
8b6bc8b9a9db75b3be0dcb66727ad838
ad739ccb1e0edec6548358dab8597347bc6949f5
25064 F20101221_AAAYKS leesamphandh_p_Page_80.pro
bfe0c6ecc95c9245392914e6fca56cca
a235b691c71c5d46ffff8b3fc6ac8a51d4212f3a
1036 F20101221_AAAYLH leesamphandh_p_Page_11.txt
a2f45cacf6354340b620ebb91e804375
b132e0dea798ce48cd07b157be54e752a4d4deb0
27115 F20101221_AAAYKT leesamphandh_p_Page_81.pro
d9e28b7161b19943bf0e9be53cb41e46
ac6ea532c05ea5c2a1ff65292a526ee7c7092864
2075 F20101221_AAAYLI leesamphandh_p_Page_12.txt
1d8e82b089d11e340049203f46d49d13
32912d3d7081d2d03357cb8e86f01e87ae67db72
26935 F20101221_AAAYKU leesamphandh_p_Page_82.pro
2a6ac432494a1c5df168db2bb7964c2a
a8c3c14c1c81c71166750d428fb6a7274b4f8245
2118 F20101221_AAAYLJ leesamphandh_p_Page_13.txt
4d2c8d0c1a3002f0a0d958bae61d2c39
3abc005a7542e7e794f06c8dda2a8f0af5394b59
23610 F20101221_AAAYKV leesamphandh_p_Page_83.pro
7664159acce503265a135b4073039054
f0741ae0c7e52ab8bd43be27bd141791d68e1db5
2050 F20101221_AAAYLK leesamphandh_p_Page_14.txt
a2fd128ad007c5c872c7dc0b7ee1a9f9
084318c91e7ca9055522111ae9dbdb57748eef09
1431 F20101221_AAAYLL leesamphandh_p_Page_16.txt
2aa607ed475282de5680d4ab90513c81
271d29f0bcbc55b1401ba31de575f3ffae29badc
48048 F20101221_AAAYKW leesamphandh_p_Page_87.pro
2fe521681486a32b7844e1d837686a7b
9ed26830338e8a3fb3446b67ee524eb7cea84ec5
1579 F20101221_AAAYMA leesamphandh_p_Page_37.txt
de399a9e4150c9653bc11979ad580a7b
754fba6f5dfae191dbb8fbc1b0c15e66eb67b342
1920 F20101221_AAAYLM leesamphandh_p_Page_18.txt
a8da5c892b053cc0730422a38408c0df
3c711b554d44e64811fd1a27ae6fba7c7974f818
55255 F20101221_AAAYKX leesamphandh_p_Page_89.pro
93fc52a466ca87290713a0c4de054a80
f20cc80ed2e06730e84d1e70405bc71df2599dd6
1753 F20101221_AAAYMB leesamphandh_p_Page_38.txt
69fee4e038821a9fdf46bddf511752a6
249fc93966b21c4fed31c1935057a418d2eafd7d
1777 F20101221_AAAYLN leesamphandh_p_Page_19.txt
b9fd1296dab21205060a9708d422ce11
3cd53733e2231422780585c34df6fbf41f0e2be4
23372 F20101221_AAAYKY leesamphandh_p_Page_91.pro
a121e6cafb3b0dbccd6ee7c8fecfed7e
3eea3c5efcb92c99b406e93a125e25d3ac864ac0
1278 F20101221_AAAYMC leesamphandh_p_Page_39.txt
8db7ffe39f0023db81daaa88434ab939
6de1cf2b8e2e2fb5fec170556a740453ba3c1172
1763 F20101221_AAAYLO leesamphandh_p_Page_20.txt
f7e69f069468db47f73136e35702b154
ccc29b8cf2844717ae984b78f8074c0add41fe05
408 F20101221_AAAYKZ leesamphandh_p_Page_01.txt
fe1131472019766f9571f9228865e45f
57271f3a764f0987b48dcf94fe5b35d4eebcdc5a
1233 F20101221_AAAYMD leesamphandh_p_Page_40.txt
ba1050beef70c188f605358c6f465f16
21be44d23682d1503b41b62daa5d8e4154407e5f
1854 F20101221_AAAYLP leesamphandh_p_Page_21.txt
62b140bdf6c22c0fe371270e99bfdf9d
2c8d9082640995a24910b5b98556ea7294dfe3a2
1054 F20101221_AAAYME leesamphandh_p_Page_41.txt
acaf8181e38a37250959789332a0be44
c56a06798901835a19709c511d3b4a45bb5b18d4
1965 F20101221_AAAYLQ leesamphandh_p_Page_22.txt
4b7befee175d20fe9ea8d1fb902baa5a
77a598622fe79ed0e3b9e5f6b9fa49caaaa20fb9
875 F20101221_AAAYMF leesamphandh_p_Page_42.txt
7bccec6d45cc3dbfced3db19db840680
3173c3b16ce98506e22b9bbeeb79e5860c2a7900
1592 F20101221_AAAYLR leesamphandh_p_Page_23.txt
429c2eb68679fce6b7dad6c5932f6ed9
9a58160abe8d66f3ace89ee9e19291b6248a2851
2156 F20101221_AAAYMG leesamphandh_p_Page_44.txt
3597f4e7ecde0db291c4fdeddf215419
4b4d88b124a9c4b8c431fa5f5c16cbf09a4343da
1671 F20101221_AAAYLS leesamphandh_p_Page_25.txt
fff8c36441c6b87a01dbdb89f24419f3
0ade36055eb3302dd218bad30bb36170ec287de3
2108 F20101221_AAAYMH leesamphandh_p_Page_45.txt
4540adf69e8ef9ebba250d2efaed7f6a
f628ea062d166707737055477c46ba8a05d81f2a
1841 F20101221_AAAYLT leesamphandh_p_Page_28.txt
f8ff4b53fa30a3f9440e256b1791704a
f1f3cc8d23df87a25435ab5ff68687e0b6c5d21d
2029 F20101221_AAAYMI leesamphandh_p_Page_46.txt
3f0bbba6fba529c529a0920782e7d72c
31b98269f86e820bb26abbf37fe0ab457046e0be
1616 F20101221_AAAYLU leesamphandh_p_Page_30.txt
5c3a3877154aed33c7ff7150df828b54
3bbf7f37367dd6c565b1b490b031f60543bcac66
1770 F20101221_AAAYMJ leesamphandh_p_Page_47.txt
f353a241b2c566d55f5f854533cc8358
56633a99b404e5ca7e3b7671c68a7ce60def77b5
1714 F20101221_AAAYLV leesamphandh_p_Page_31.txt
79feb199d119d89d17b80786c4018f18
71b2f7b5f74cf6f26f8f0439362193e50881a248
1908 F20101221_AAAYMK leesamphandh_p_Page_49.txt
2706cec90315001071912329d3f2c139
783a7c301d70152629e823c1995655728594d91c
1713 F20101221_AAAYLW leesamphandh_p_Page_32.txt
0c4393889a06204533dc6012fc0e6ee7
706a5f963df161c6c92b0c05813313748b3fa207
1781 F20101221_AAAYML leesamphandh_p_Page_51.txt
022c38fa14084d4886d8a94fb00537db
7df780ba6eb961cd16ad2d4bd336d751a908554d
1785 F20101221_AAAYMM leesamphandh_p_Page_52.txt
841459d7d87c5e2b771faf2d67232cb2
b7c5eaaea67cd3bb75f5359d49d15598c360fb57
2090 F20101221_AAAYLX leesamphandh_p_Page_33.txt
c99fa95ca4a7cfdb06314d9955ac1331
f3aff5f11d671f5da205c6bf83a3d797be5a86a5
1627 F20101221_AAAYNA leesamphandh_p_Page_72.txt
1de0e06edfc52d78cde40c62752aa0c8
a2cfc905bb88eba073ca6e0e853a49f313c44646
1652 F20101221_AAAYMN leesamphandh_p_Page_53.txt
b0752099a1f63cb504334ecd90a6763d
0a6171a774250643e0442d0d1b01d6059115b30c
2174 F20101221_AAAYLY leesamphandh_p_Page_34.txt
4fa5e01c3cfc5cf5b3b2dc0bdeaaf034
d2904a097e1405b6439d695fc1c8508175d7b9ed
1504 F20101221_AAAYNB leesamphandh_p_Page_73.txt
1433c93877d4d2685c98db50f891f307
07a625757732a457eb0d4fbf406322d6964b08cb
1869 F20101221_AAAYMO leesamphandh_p_Page_54.txt
42d0948d80a466ebcafdd6507d08ac20
39eefd8752bced83c468d4d6e778ce3ad751d78f
1948 F20101221_AAAYLZ leesamphandh_p_Page_36.txt
f9802c37c933a2f3101791b109514919
d09360acab6ebc13d3cd3844011c736a144180b9
1852 F20101221_AAAYNC leesamphandh_p_Page_75.txt
9a8b440cd91fd1bc12e87d973fe623ae
8dbeedc6a4e0f111c11079210741db4681c90254
1923 F20101221_AAAYMP leesamphandh_p_Page_57.txt
1225af3f11c89181c40ff396af25da00
765044744df77e0210ad4abf22ee1582b92207f0
2053 F20101221_AAAYND leesamphandh_p_Page_76.txt
f88f4ab552896e0d872427802189d2dc
2ac96a341c30c01d9de5f3e462f5c10ab48739e7
1229 F20101221_AAAYMQ leesamphandh_p_Page_58.txt
b3a5803bc70d1eba5cd21fa0c9ebceef
dbe66738d384ceb622272e6ad5f6d524d3c55ba2
2049 F20101221_AAAYNE leesamphandh_p_Page_77.txt
4cc01a5b0aeb8a4ee06f5fbc5f137bab
0a6951f6566109e2a0d7e0381bdca72880e82733
2079 F20101221_AAAYMR leesamphandh_p_Page_60.txt
0b963c67758cb759c958c9dffdd03c92
619810ed11bd6bec1ae3a4ac835b9437bff703c4
F20101221_AAAYNF leesamphandh_p_Page_78.txt
4f6472dc2f90ddf5a37886b0c9b55d2b
93c6ec39657d61c6eedfe24e8033729203404628
2194 F20101221_AAAYMS leesamphandh_p_Page_61.txt
ff10e973bc407997feea31cc7d931e96
7d6b67391f596300b37e93bebef73b0cf9c56b52
1747 F20101221_AAAYNG leesamphandh_p_Page_79.txt
a871a1d5da29c403f6d31e7eb916654b
178dc0a8c4eea1dfc35573e56770f5e256926e19
1635 F20101221_AAAYMT leesamphandh_p_Page_63.txt
26003831d6e247620548d472c5299fc6
31d8b5f9078ba6c25efa38350b322bbc815afbf5
1276 F20101221_AAAYNH leesamphandh_p_Page_80.txt
80d26b8e49aad54b4ee83c9da155e27f
d338b2d1a64f165a2b0ac25b9447d2d89265ed5d
F20101221_AAAYMU leesamphandh_p_Page_64.txt
26eeca4f6a722cc1d2ec9ba5defe8579
48be41b8f679308293ab34cbc8d31ec98feaaaec
1211 F20101221_AAAYNI leesamphandh_p_Page_82.txt
1bcac523f548a80af9ee8a31884cc0ff
939398747e51abe10b761956098244ce308a981e
1880 F20101221_AAAYMV leesamphandh_p_Page_66.txt
82faae287be4adbc724e25b89d2a7ae3
b3617b7cade870c9fcdeb17ca48a03fbec77e6b1
1191 F20101221_AAAYNJ leesamphandh_p_Page_83.txt
7ffc8c185afd3573d22bdf5c5b002a16
1e69a3ff1d8abb8871307e8c96eeb40a848d952d
2114 F20101221_AAAYMW leesamphandh_p_Page_68.txt
11d5b1be275a8ca4348e07b6d4ca09b0
c72e800286f8ccce892d71d21150c2c0c27633ac
1348 F20101221_AAAYNK leesamphandh_p_Page_84.txt
7850eaf498bad6904be2df8f43f63eb7
63e5666d65305aff921deaa2575fbad43be336e2
F20101221_AAAYMX leesamphandh_p_Page_69.txt
dc0ea37b21c49dc797a15a0586a4ba16
b21e9dad9fc0a8d1aefe932a153b7cfa7e14799b
F20101221_AAAYNL leesamphandh_p_Page_86.txt
7c7900e49ec91b3a9379be09381e1fa8
14b4309212af9278e895d9cf9c43783de2dc0b8a
2438 F20101221_AAAYOA leesamphandh_p_Page_06thm.jpg
b5b2c80d53af262051f7d10eaf31b4d6
07af6f99edf11bc7aa06d4e4e7471b2965b5b4b1
2421 F20101221_AAAYNM leesamphandh_p_Page_88.txt
e889d10e31b7f5af18ada09f1638bac6
9263af6bf82b941fd5fc0f65523b3b0239ce0d8d
1572 F20101221_AAAYMY leesamphandh_p_Page_70.txt
4dfa6462635d73fbef9adc5724823708
e8a537943db9b4c8fb1d64210614271293b67761
7488 F20101221_AAAYOB leesamphandh_p_Page_07.QC.jpg
3225d3a4b9491c38dd2f7c8d2464ff71
b4e0fac44fc6240d233c3a05a7f6886a963a54ae
2281 F20101221_AAAYNN leesamphandh_p_Page_89.txt
9c87861c687bf6bf206d7135b4282b91
fdb84e98817aba7adf0cc2a0766135d730f8cbe2
1725 F20101221_AAAYMZ leesamphandh_p_Page_71.txt
6fc3a1b39663291049df4b9ea465ccf6
989095308ce143082cf581d8c47812c99ad037af
7283 F20101221_AAAYOC leesamphandh_p_Page_08thm.jpg
c146fc16bb77e04706ff8f67d81375bd
c4e271458fa71a16b0b5f06c31f0c8c1d576a30c
217 F20101221_AAAYNO leesamphandh_p_Page_90.txt
cbb1e7dab409c45027d8e8e2bbd7f0f2
4098189bcc8dcb3316b7a769abf9ced2e2484117
17368 F20101221_AAAYOD leesamphandh_p_Page_09.QC.jpg
1f7c43418ebcaa0311901f8d1373eb80
a5950a1b34bf0dfa0fca75de194ac8075110349e
324036 F20101221_AAAYNP leesamphandh_p.pdf
2417161011fdb8f398c93091737cc83a
95aa0ea5710c4c66d8ca316e53df1037b0a744bb
34508 F20101221_AAAYOE leesamphandh_p_Page_10.QC.jpg
3dabb9cce0a26a12bbd63ecacad2c86a
39449ff907cd158256cba8f5f22d5ba0d202c135
7163 F20101221_AAAYNQ leesamphandh_p_Page_01.QC.jpg
d92d0b62dde04eb094e6924facf34b27
e3763302b559a4de05b34cfc67dcaf8cb776467c
8272 F20101221_AAAYOF leesamphandh_p_Page_10thm.jpg
9985dc7706335f90ea2bbbf8208404c3
5c943a8174bb4294edb2c9acc87d175a9bf4186d
1932 F20101221_AAAYNR leesamphandh_p_Page_01thm.jpg
fc716bb00ead82da7db807401a72818b
e0f1c18c72523e609a9170e11d669fdb484f7bea
18701 F20101221_AAAYOG leesamphandh_p_Page_11.QC.jpg
3a8442b7e65d640afeaf0ce696087dea
99eedf1e94eb7532ade17edac2c6ee36011d1f3c
1360 F20101221_AAAYNS leesamphandh_p_Page_02.QC.jpg
91dcc25b780fe4a1e3d7c5321b134cd9
5ac58331403e5f81853ee01f53a6cf56f7d57b13
34541 F20101221_AAAYOH leesamphandh_p_Page_12.QC.jpg
904e4b131816e8d770b7008046777e32
bcc81e6d74ad7d00197e39e5916bb03126ddadf5
526 F20101221_AAAYNT leesamphandh_p_Page_02thm.jpg
74de186997e09d11aecb5054459d2b31
cfd97d86e4b865f656a471945345c018f290f494
8388 F20101221_AAAYOI leesamphandh_p_Page_12thm.jpg
6839dd8fdc24a1c40258c64cfb126dc2
6587e5df4c9266665ff4b9a64efa18d08010a2c6
1649 F20101221_AAAYNU leesamphandh_p_Page_03.QC.jpg
96206016f9c1b1e9c04980442d647b27
8b868e79d69e91f6a9720d03f5f0ba3c5f868241
34831 F20101221_AAAYOJ leesamphandh_p_Page_13.QC.jpg
44e22a790cde8b14bdff9652b21e394d
1a37216ffa0c474532b7772f6fc656533e37020f
695 F20101221_AAAYNV leesamphandh_p_Page_03thm.jpg
888e80ce50a6c2bd0adf6daf031a5318
0587c16409c6ca8d10ec58e25eb63535327a1fc3
34724 F20101221_AAAYOK leesamphandh_p_Page_14.QC.jpg
13ba0e1ebddc6c70345c52cc35f6ecdb
0d4e6a9f571d795570e37322177a9fc41d7ef0c3
27084 F20101221_AAAYNW leesamphandh_p_Page_04.QC.jpg
85dc2ea841cdb1e4636aac360ae5d154
3073f6df602d6ba896d7fcfe155be0a9d893fb1b
8638 F20101221_AAAYOL leesamphandh_p_Page_14thm.jpg
7ff03f5f39fb392944e5edc32fc3bf67
84e5817f9f44a8980b665500343f0febd35f08c2
6528 F20101221_AAAYNX leesamphandh_p_Page_04thm.jpg
72bdd4f47e05ee53d6845a025a5d2b4c
8f23a59913b474b394e92dbf2cc08a502823a9cd
7642 F20101221_AAAYPA leesamphandh_p_Page_26thm.jpg
154194ce7e556d2870f9f58dba8c28a8
a15d23b1e869a6d63a0ff9a5f91260ace3b3e5ea
7618 F20101221_AAAYOM leesamphandh_p_Page_15thm.jpg
01ad11b5a920d000c86e2fb93666ac37
620bfa2627aa172fed1f2eb0e6dc85e71d96f454
6783 F20101221_AAAYNY leesamphandh_p_Page_05thm.jpg
4cbf7c06ac9e28b3cd09ac4d8b94bc30
63bfb34f55573da9208898a160a13c59c7e0644f
21715 F20101221_AAAYPB leesamphandh_p_Page_27.QC.jpg
999dcc8485b871e5126fe272eab25e0c
3a0c18e9e33efc40536f3f7f20186bffa9bb3c24
22548 F20101221_AAAYON leesamphandh_p_Page_16.QC.jpg
e188f99fa4f773cd5b67ded038b807e1
16124b8e848d81de8f5a67a20136d659c794f6f8
27175 F20101221_AAAYPC leesamphandh_p_Page_28.QC.jpg
613a9b32ab35e8f0ec1cc844ee5ae1fe
ff7aaef76a2a0e96223892cf5f36e2e048618823
31435 F20101221_AAAYOO leesamphandh_p_Page_17.QC.jpg
211e3bb5f91916f040f699ec1543223d
0b2ebb11c46eeef372a1941ba1bb591895cf97b2
9219 F20101221_AAAYNZ leesamphandh_p_Page_06.QC.jpg
2716fea771cec810ed8fdda11afcd18a
402a45f8f02431a6cc09b471c509a18a0fea0ac5
7818 F20101221_AAAYPD leesamphandh_p_Page_28thm.jpg
47f577e8ccdd6e8eda992a9033028954
675de2959963abb5dca65611f4d86a218a1b2196
7903 F20101221_AAAYOP leesamphandh_p_Page_17thm.jpg
15534cd3bdf02ac92ea9bf251f710500
f1888ed84cfba21cf98df7ecd74a71016e80e16b
29111 F20101221_AAAYPE leesamphandh_p_Page_29.QC.jpg
b34633a7f25a776e22c6dd2175c7852a
07cb77f2c50abcb4b15e88f4350bbdd224be9692
8737 F20101221_AAAYOQ leesamphandh_p_Page_18thm.jpg
403f63eb9d87f9cff3833872e1bc3f80
b6a3e4fad4e3b3c1dc9ad63d3a280b7c6aeb5efe
28378 F20101221_AAAYPF leesamphandh_p_Page_30.QC.jpg
09ce452c5538ebb166d4662c2a1531d4
ecdabfbda82ff88406076a2a0119215be2eb46a5
26240 F20101221_AAAYOR leesamphandh_p_Page_20.QC.jpg
f71d7a9aabd46d65af0dd2e06b5a6ba4
f1691bb316a36ae3d4c67f5b5b98cfa564a47dba
29719 F20101221_AAAYPG leesamphandh_p_Page_31.QC.jpg
1b07974aecca1a77ebe1fa76ae49921b
33398ae2e6760a59d52056bf6221cac7b0c73307
7354 F20101221_AAAYOS leesamphandh_p_Page_20thm.jpg
8cf89eace21ec441c914450e21197702
f0a4fd019ec5575d752990ea4f181497e972d23b
7371 F20101221_AAAYPH leesamphandh_p_Page_31thm.jpg
68a8c59459c00d2b9037b737893258c6
d6ae995c6af0e60a57dc0c48246c15fb96a486d2
27772 F20101221_AAAYOT leesamphandh_p_Page_21.QC.jpg
1f748aaa0add04111d3cb85bb3d53a85
0296e8b601dc4dfaee93437cd91c506178245461
25470 F20101221_AAAYPI leesamphandh_p_Page_32.QC.jpg
3dcc78c817c81918506f45b5d2deca7b
42c001bba64b53a291a6515df096b2a30c588477
7750 F20101221_AAAYOU leesamphandh_p_Page_21thm.jpg
ac6f8a6db8e0674903ebfb774593b4d1
7d53abd771a728fc258b8c37a9f16ff613093a47
7299 F20101221_AAAYPJ leesamphandh_p_Page_32thm.jpg
2290e6b107e4c4883c54f62f5e48ea50
ee3a12ac686acb82fbca3e9f276ee3eea116ff6e
30227 F20101221_AAAYOV leesamphandh_p_Page_22.QC.jpg
703bb5a1f07eb040d6e3deed8c0d3787
70ebe141895fb91bcc158f51aa1bd1ac7c8bfa4f
8122 F20101221_AAAYOW leesamphandh_p_Page_22thm.jpg
4cb9eba190c186b4d9f1f93beae062bb
d69ffe636002f385d47e29951ee2a59ef2aadc41
35341 F20101221_AAAYPK leesamphandh_p_Page_33.QC.jpg
15b12b8d47a9713de67c60f30bc2d99e
a3320d783f3b925b873149d0ecfa7388aecfe5ec
29738 F20101221_AAAYOX leesamphandh_p_Page_23.QC.jpg
903875a0346ed3234ae2c2ab94c95953
147520cff7c55a509666598ebc496c426f8ce527
8703 F20101221_AAAYPL leesamphandh_p_Page_33thm.jpg
c6f3c28d7c98bcbfb5c0f7b1e2453671
6c6eb4859000c82e25245f1b6aeca69fa2d195c6
7715 F20101221_AAAYOY leesamphandh_p_Page_23thm.jpg
0ef0cba5cafeaa58b47f4e5393049788
150ab6b8fb6678a7996a0d868e5841ada74dcf4c
35381 F20101221_AAAYQA leesamphandh_p_Page_45.QC.jpg
332401e5719bf632684597520e584ff7
79bf548557122b0f7e1c05b97f9279dc8881190b
31068 F20101221_AAAYPM leesamphandh_p_Page_35.QC.jpg
461044b58996330f8caf7a96698f5b41
b7b57cf4dd67a3aecd521f2379c8860f50735a6f
6871 F20101221_AAAYOZ leesamphandh_p_Page_25thm.jpg
62aab7c293c753ca2e91edec5399e39b
52a96fd873bb6429411279f11fd3ba5f7e2668a4
8676 F20101221_AAAYQB leesamphandh_p_Page_45thm.jpg
3d5b94fbd51d6b64a4278410a62649a4
6cf471a1a31dd7ef0bb1d56d85baf289144c0d43
7606 F20101221_AAAYPN leesamphandh_p_Page_35thm.jpg
ec26f4e67a2b9215858ea566a5f96f37
e1e7e35e78091744ce7a9b14520ac24e4cf8a5ce
35334 F20101221_AAAYQC leesamphandh_p_Page_46.QC.jpg
2b794d61a614bf4b79d62e31c82820c1
4dc5ace335d52d8fb8ed28fb3a64a15bad3c1c5e
30713 F20101221_AAAYPO leesamphandh_p_Page_36.QC.jpg
c9b0510d98183ae7101ff78f9864cd67
370cb143c21f81c020fa1095ae88603048f649fc
8149 F20101221_AAAYQD leesamphandh_p_Page_46thm.jpg
6916e2439dda138db7b38698a1dc32d0
6c3527ae5bc4a81553656fd3171e4df66ccb66cf
24969 F20101221_AAAYPP leesamphandh_p_Page_37.QC.jpg
997835cbd9456a1147910fccc3a285fc
2bb59082f769b46ddd3353671396aceb9d4ea3dd
28960 F20101221_AAAYQE leesamphandh_p_Page_47.QC.jpg
ed2e70c7e25a2b1f2461036eb20beada
c6a7dbd7c97b7b4c1489bba8aaa4acdc1d93502d
6901 F20101221_AAAYPQ leesamphandh_p_Page_37thm.jpg
7834798ed20560c310428ad75683cb10
1689da0ccd15bf894a414d17a9ed7f0f291eaafe
7767 F20101221_AAAYQF leesamphandh_p_Page_47thm.jpg
c10ad315ff0f7d5e35a40c53c68a403d
7ca16adeafb15f9bdcf5ef89b52beccbe749dd24
28439 F20101221_AAAYPR leesamphandh_p_Page_38.QC.jpg
74b5f3a829fa4458ae01ab97a52c0f21
0dd3acba303137e289e999064427a3eba00beccf
28230 F20101221_AAAYQG leesamphandh_p_Page_48.QC.jpg
8e3d866d831a7fe73dc5fa3754d15703
dcef3a57f70d45758886ed9e2dcada9079ccc26c
7475 F20101221_AAAYPS leesamphandh_p_Page_38thm.jpg
b7bc428f03333fe984450f5215f01736
567b2bb85350fc830f488a435f93f68702f4cb6c
33398 F20101221_AAAYQH leesamphandh_p_Page_49.QC.jpg
8a067f86e011e37028b8d65b4c2c2f15
74c564ef741ba0a64f22d3143d043698f7afed2f
26080 F20101221_AAAYPT leesamphandh_p_Page_39.QC.jpg
1f7b3be36bbe18582684b602cbc0194c
f018aa6dc27a804deaecb12ce6d80ce275fb9228
7900 F20101221_AAAYQI leesamphandh_p_Page_49thm.jpg
fe7c17680873e84214b969195c485fb4
64c3e4229a4a0193c1519b71938b93c490820f03
18945 F20101221_AAAYPU leesamphandh_p_Page_40.QC.jpg
4e7e3316d8177b71defb98c9498b7669
7574fdd84083d39f6353c17114f1bbb3d9e516f7
25593 F20101221_AAAYQJ leesamphandh_p_Page_50.QC.jpg
c824fc2518dbb9db02a4edfbb261b318
442f76a332cfed573204d803b6a058917f5b38fe
6288 F20101221_AAAYPV leesamphandh_p_Page_40thm.jpg
46f978ca394dd3426060aa188c4980fe
9378785b7264176acddf4c94cece07d7f4e80129
6796 F20101221_AAAYQK leesamphandh_p_Page_50thm.jpg
aee0cdc4f27aa28473262aaddd0b003f
79238c4260b530dce3a9cccaa626b6ae6b456de6
20710 F20101221_AAAYPW leesamphandh_p_Page_41.QC.jpg
4a0835b6500282679f4cc5e4a978c4e1
f6ad48945ffe9c5db50a8b6e842bb40cb7003b0f
28777 F20101221_AAAYQL leesamphandh_p_Page_51.QC.jpg
3c341b90add50794349482895a0b86b1
6a0f28723029fed25e22efb950543999f192daeb
19391 F20101221_AAAYPX leesamphandh_p_Page_42.QC.jpg
2dc6fccb11af5aa476046c5d13ad7879
d440ec73600af01b5102d17985fd36ad4f7d3ae5
6523 F20101221_AAAYRA leesamphandh_p_Page_63thm.jpg
60f8711677512c4c2b8742b6f9fb3cfc
8bdc3d2bf502788df08f27bf0101b2ba80d38dbf
7641 F20101221_AAAYQM leesamphandh_p_Page_51thm.jpg
2909cf1403e09f6143796184f2fc2db4
521df0e50c90ffc6cf19b4c81f679208d190fbfb
5540 F20101221_AAAYPY leesamphandh_p_Page_42thm.jpg
42d9d708dcb30fd6527dfb962a0d0628
b3025de5908aa9ae91527196cc0cb37496b43445
33090 F20101221_AAAYRB leesamphandh_p_Page_64.QC.jpg
c759ffdb86a16077204cdf66c902763b
069fb7f013b18b2ab71f36fb28e44aa3c7adbc81
7269 F20101221_AAAYQN leesamphandh_p_Page_52thm.jpg
80635d550726c8400b3981a50c44bc16
58555650ad5b6ed11ccdfad34a3c6cc3ea39d5eb
36405 F20101221_AAAYPZ leesamphandh_p_Page_44.QC.jpg
9ebd0f880de1969749a6a9ddc42c78f8
8b12a872aac79d785c64f2e95bc478e00702ac2e
7827 F20101221_AAAYRC leesamphandh_p_Page_64thm.jpg
66127e95a2560945b7c519d011e8514d
2b6c8d658fdf3c59458fab62b481510e700f5297
29779 F20101221_AAAYQO leesamphandh_p_Page_54.QC.jpg
f4d0a48cb0d38a47f4f998db6a37dd2c
c57c140bea2afc9e9e494f21b9c97c28e4be2a14
34134 F20101221_AAAYRD leesamphandh_p_Page_65.QC.jpg
b81195924ab2b45c69fcf3088891cac1
20b18c668a34dbe30f78f41a048b4d8e30026680
7732 F20101221_AAAYQP leesamphandh_p_Page_54thm.jpg
35c8d35719fb75fc0ba810200e3723b7
b6dd77c61237b6121fa747e3ed29c28a28a56b00
8446 F20101221_AAAYRE leesamphandh_p_Page_65thm.jpg
45f1032f52e5eec41f8a36257d007a4e
c6315e93a0af80bda83065b554584b41148eb4f0
29385 F20101221_AAAYQQ leesamphandh_p_Page_55.QC.jpg
908911c3238343b6c794aaf6f40f73a6
126fffc303493cb48a8e94b3b4441ab283c594a5
30494 F20101221_AAAYRF leesamphandh_p_Page_66.QC.jpg
cfc1c37f497a3993991012243d54b20f
577aa09b46437d5b2360c6a562c28a453974c932
7885 F20101221_AAAYQR leesamphandh_p_Page_55thm.jpg
e71eeb40a49130d6d15cc2ef82164965
3029c1a5a6ac7d842ca292f96ddefcc016a1cc88
8309 F20101221_AAAYRG leesamphandh_p_Page_66thm.jpg
52e37ab6693e95aab71a191fbfc4aebf
5216d0ff7a7aa2405d3990f45deefba05e13a810
32686 F20101221_AAAYQS leesamphandh_p_Page_56.QC.jpg
aa76123ee578bc5a0c91dd97b17ee799
42a8b8d4dfeb18156b4a90209252739a903d335b
25926 F20101221_AAAYRH leesamphandh_p_Page_67.QC.jpg
fd4ee01bae6a0f8ef82da73748d88da0
4c42da1899e0c1499c13a07c58c20e67cf33b844
31051 F20101221_AAAYQT leesamphandh_p_Page_57.QC.jpg
5705ed900baf541b7f8ecb8cc80cae9d
ede95ef7eb202355c264e992bc804f007a818bc8
29337 F20101221_AAAYRI leesamphandh_p_Page_68.QC.jpg
b0f09b47a98d2280c4b4be6d25f79877
4464c52a93172a9a017bdea99ff1ec2d6f8e7bcc
8214 F20101221_AAAYQU leesamphandh_p_Page_57thm.jpg
25029c596ebc3f8a90acefbf622d4ec9
084ccb4b3cca2645aafef6784e928b492e71ec65
7859 F20101221_AAAYRJ leesamphandh_p_Page_68thm.jpg
7a32e29b0cac4bc37445173ac302970e
91162f0a2f2b9619f5f41cadec71c02ef34c7618
4973 F20101221_AAAYQV leesamphandh_p_Page_59.QC.jpg
14e4a9a404a6330d701b1ead55f4ee18
af143fb2221ed5d3b9dfc697bfc13e729bdc4429
7503 F20101221_AAAYRK leesamphandh_p_Page_69thm.jpg
de1b47cee1f41d64fcd86940731608a6
333d857b95ebc2a5c0af5dc0d560d2af56b725bd
34380 F20101221_AAAYQW leesamphandh_p_Page_60.QC.jpg
b9f528863b19ec47aa674ab1cb8f2153
8e27408ef0332167c2dd2a3fc5c81b049f6cb981
23297 F20101221_AAAYRL leesamphandh_p_Page_70.QC.jpg
0f89b2410410f8c04d00f25f8629ce41
7ecebbf705fa89753bc673c6e0c086e805d27b2b
8457 F20101221_AAAYQX leesamphandh_p_Page_60thm.jpg
7230b98a520a6742173a4f0d8f364f45
29e2fbdbeda8493a2931f4354e6c494e17528b30
6815 F20101221_AAAYRM leesamphandh_p_Page_70thm.jpg
a9249bcb45b67c2e7a1e86860ebf1b41
e5e28f8ec674311a5d4837e468ffa5bfaf909018
8367 F20101221_AAAYQY leesamphandh_p_Page_62thm.jpg
9f8bd12dce7eccbff1a46c913051cd54
37087141c6a64aaddcfd891d2fdab3c612f35089
21596 F20101221_AAAYSA leesamphandh_p_Page_81.QC.jpg
5b659be789c4a39a44e28264af64c809
a145121d19f47b18f368ece768434a4421e456c9
27994 F20101221_AAAYRN leesamphandh_p_Page_72.QC.jpg
e945f25df3bc4f52af4f08a8f343feeb
70c955180c89f8c660ea5f9a9713c038eeb7aa5c
25070 F20101221_AAAYQZ leesamphandh_p_Page_63.QC.jpg
69af2f87078932bb2c92043c60ed6735
ac0b80f1a7ce45162e17464259dd2fbd234d4754
5921 F20101221_AAAYSB leesamphandh_p_Page_81thm.jpg
7c2c7d84fad7ac2c7751511ea14418bd
c5134b58c3d9aabe24f649e0ec1bfb3a56ad19a5
7668 F20101221_AAAYRO leesamphandh_p_Page_72thm.jpg
0f3676ae8905d739b3b663c1df29327c
ba9c74d9c1e9f78afa7eafa0f787cebb7adc25c7
16963 F20101221_AAAYSC leesamphandh_p_Page_83.QC.jpg
610532098ba2a7da2bc1d0900ca9357d
567b60bf501d61898794b95f0f20c3016c8de82d
28675 F20101221_AAAYRP leesamphandh_p_Page_74.QC.jpg
4df74103778c3657cbbf8cf2043f24ef
873e295fb058909cce3d82617dabbaa6ce38eae8
5236 F20101221_AAAYSD leesamphandh_p_Page_83thm.jpg
69fb9a95fa274c1f4b7f0bca9ca67ce1
98f8a73e5d49d600354789f6bdce9b1a4e7b6bec
30522 F20101221_AAAYRQ leesamphandh_p_Page_75.QC.jpg
66586fa881c2b6075f36bd0d189d1e9c
ab2e39de28c9a68ed2b20adb1cb896b63a20318c
21477 F20101221_AAAYSE leesamphandh_p_Page_84.QC.jpg
38efb24a5aeea03e4612cb66489f94bc
6c8c07f23507d4144cbc4971bdcfa10f153aa860
7894 F20101221_AAAYRR leesamphandh_p_Page_75thm.jpg
006f2c1607e0d12e6ede8949a637671e
d0638cae22373295397f1a27402c0df92bb57fa0
5897 F20101221_AAAYSF leesamphandh_p_Page_84thm.jpg
0342eb4652c0db4b7c5d0bdfa73d23d0
187680ef246a50d9568f5eb5dda3df5678b15e69
35672 F20101221_AAAYRS leesamphandh_p_Page_76.QC.jpg
5a5c21fa7889b377790fd6fab6c53870
eb725a060a9bf29640d37c7b74d517f7b836b52e
997 F20101221_AAAYSG leesamphandh_p_Page_85thm.jpg
a3285c9fec9f4118b08a3ccb4129e650
77436aacd0cb21f65f9902cd371824011cb47c4c
8778 F20101221_AAAYRT leesamphandh_p_Page_76thm.jpg
e92a3cd3b9b1f5a5d3f88372a79f0cfe
651b4bd3947b45a30432fdb193c594fc20f5461f
F20101221_AAAYSH leesamphandh_p_Page_86.QC.jpg
b179b037a4a4911f07669786a249521d
6b006228be53a448e761e03bd8dda978f5920f4b
36490 F20101221_AAAYRU leesamphandh_p_Page_77.QC.jpg
15cb3d430bc3fe9793c21f56899a2053
0946942df21353de8811a02951d229e86a20146a
2644 F20101221_AAAYSI leesamphandh_p_Page_86thm.jpg
813120eb33ddb821e1f73bdd5a5aa037
3fd10e04511d3513ef7f278dbd012bab730d6489
8736 F20101221_AAAYRV leesamphandh_p_Page_77thm.jpg
352bd784840a93bc72db1f0bb44bcf4c
4928f3961d104cd265cd67e6b5c742b84fbdff88
7804 F20101221_AAAYSJ leesamphandh_p_Page_87thm.jpg
af7dc242ef06aee2c6d193190bb70053
937ec355e999ee631bc4bea7028406fa76625b7e
8015 F20101221_AAAYRW leesamphandh_p_Page_78thm.jpg
01923ca5e9058992a6ba1a6e1a73f5dd
f314adc4b505580463c66b4c1c0810f15be38b11
34967 F20101221_AAAYSK leesamphandh_p_Page_88.QC.jpg
1c470654cfda56116a98de24bcae0bed
7486138c9d5346fbf4f8c4edf92de60614147e9f
25340 F20101221_AAAYRX leesamphandh_p_Page_79.QC.jpg
99566726753b79c004d0ec76bddbb7bb
a3145ec552a56d769646b244179b655de795c165
34459 F20101221_AAAYSL leesamphandh_p_Page_89.QC.jpg
b01d08f7d72c5ba40788869bae193ab2
fd6156ddc0a9b892c2e1329229518df714f1833d
19948 F20101221_AAAYRY leesamphandh_p_Page_80.QC.jpg
b16db97bf82f7edc6292787d63cbaafe
006a9feb1fc9411859e9e87bd61b4edb5002a354
4381 F20101221_AAAYSM leesamphandh_p_Page_90.QC.jpg
f9937c00c754ac5b662ef9c2537e488c
0b799b2783830d903b12062563710697743d94b4
5636 F20101221_AAAYRZ leesamphandh_p_Page_80thm.jpg
67042c5427b72879f5915c21e7b3dab2
d174b1733a8085b458e5fdb1dc27f063974cdbae
1060 F20101221_AAAYSN leesamphandh_p_Page_90thm.jpg
2460385986fbd87e0f1d7acfe5c9e9e0
0e4a44ddc801ba5ddfd2b1c76598f5e3e53bc761
17270 F20101221_AAAYSO leesamphandh_p_Page_91.QC.jpg
f86d731bb664ae42f863fa7ea312d135
c3fc1900956560dff7af80c73c81d23244e832c0
108540 F20101221_AAAYSP UFE0022151_00001.mets FULL
6d64891c8352a6765cafc24da7ac0f0d
1eb2babd4a88a2d69514e2f2e23d645c3824cef9
1790 F20101221_AAAXUA leesamphandh_p_Page_74.txt
6fa8570bec0a7b4ced682cf316edff3f
b6f9d4246985956ef19fc0f927365a3c428e8965
F20101221_AAAXUB leesamphandh_p_Page_27.txt
f771cc1ba0621ce7c324a6f44ddc277a
3faa5c2f478732a4411115bc42bc14a7cf28a0e3
754777 F20101221_AAAXUC leesamphandh_p_Page_27.jp2
db5fdaa89614b36de3d135bfb37d0c99
3310b19f41fe516abe782dd661e499fb553591b9
F20101221_AAAXUD leesamphandh_p_Page_73.tif
823a3591e6574ba2fda0dd711ac5038d
d91c85bcac904e4e78b15c1b8d9a6b49dd396066
8258 F20101221_AAAXUE leesamphandh_p_Page_19thm.jpg
9c5a08a4bbee003da612f47587bb48d6
af6d0ae642f935d87d0709f54e01460221de9718
78233 F20101221_AAAYAA leesamphandh_p_Page_79.jpg
cc3a76b2d2cd02869801359d11151d0f
f66774c978aec910f012d367c640c1edbfdc1ef3
6351 F20101221_AAAXUF leesamphandh_p_Page_39thm.jpg
f76a0e2dc1a406dba7a53ae8c19c226d
80f29ec480ef9d6094a8e14b9dba55c5c69da0cd
99076 F20101221_AAAYAB leesamphandh_p_Page_87.jpg
2979700176a0a0bf645f21ac982e7806
1ff321b97b43afc5826d8fc68a1acb81aca68c90
1030950 F20101221_AAAXUG leesamphandh_p_Page_75.jp2
ebadf2c77c861a2be883a9bb36e8a276
9598fde9f8cc79f7b3f6411069de4624b8207f37
6735 F20101221_AAAYAC leesamphandh_p_Page_53thm.jpg
476165cee9150654610586a968f67f83
cf6054651e339be1ca5bbe1db3f5b6b3278b3377
82237 F20101221_AAAXUH leesamphandh_p_Page_71.jpg
bdd5214c41e891b5fb47fc8a26e78d37
1e5c4b02c0303fc0d92fbe7c412651726285d833
140807 F20101221_AAAYAD UFE0022151_00001.xml
73bb00dee0752dc6cd21a7ffeef9a350
0e31931a72714f2060047d387c9573e95c5cda3a
23376 F20101221_AAAXUI leesamphandh_p_Page_82.QC.jpg
d8480351638602202db8b07ce878f3dd
ee07002deb6e0d5bc985cf88ff6d1026a3049240
96584 F20101221_AAAXUJ leesamphandh_p_Page_64.jpg
e885ce113bb6475021f6497b471ccd60
43911c85dbcee7703da2afe15d3e04bd20963ade
1051926 F20101221_AAAXUK leesamphandh_p_Page_36.jp2
14ee4e9091b60c12009f4bebf7fc0875
071563bb7b09fda07d27d288e6b2df9bd4a626bc
22903 F20101221_AAAYAG leesamphandh_p_Page_01.jpg
811b27db12fe5c3df49cea0c3f474088
9f2d31dcbe2bc8fa02575491e96378f02825925c
2155 F20101221_AAAXVA leesamphandh_p_Page_07thm.jpg
38cb7e906763cffa41d0013a316cd96c
8370795e702634124197470cc20c4ceaadf5403e
F20101221_AAAXUL leesamphandh_p_Page_20.tif
be8ce75cc79717cd5624af037d7983b4
8d3a7c98914aa305b3cd002023cb01952768f453
4162 F20101221_AAAYAH leesamphandh_p_Page_02.jpg
92fef92d84445aaabc53bd02f6d83035
35f9e4647eb46fa815c5835887fdf584f1307d1e
12765 F20101221_AAAXVB leesamphandh_p_Page_07.pro
c9a0f245119de0faed6cb3edf67ab064
bd7ac855cc920707ec8f7b69b7dc819f97df46d9
F20101221_AAAXUM leesamphandh_p_Page_49.tif
ed206fb8ed06e7b646a7b792893d5321
226e0d875f0c24b2a421032e485eab652d6beccc
35076 F20101221_AAAXTY leesamphandh_p_Page_25.pro
8f7cb7340961c4707f1d897cc006e862
6e7b6de58ab34e0879a83b275594e06a9c7526cd
5983 F20101221_AAAYAI leesamphandh_p_Page_03.jpg
83c338a2b7b4a095fb7167594213ffbd
38a35e16ba0ab443813e507483eec72cf74c83bb
461 F20101221_AAAXUN leesamphandh_p_Page_43.txt
bc74ec3979b5585de6ee5ad85e6b515f
439f7e3c8f28c4806b242ab011cac06c879c0372
407164 F20101221_AAAXTZ leesamphandh_p_Page_07.jp2
48a7e06e910c7cd529b028c62f1d6a28
4caf314d030964af443dc04fff40209215ae159c
83556 F20101221_AAAYAJ leesamphandh_p_Page_04.jpg
5d76b0c63b93733a74bb0e2682cd5bf1
ba4014d5f2557519b7299be6c475d67d0a70e41a
54844 F20101221_AAAXVC leesamphandh_p_Page_34.pro
1954926bf336a9b0a1cca40534b3759a
4baf0d751d43fcface32dea9885679496fdf104d
1951 F20101221_AAAXUO leesamphandh_p_Page_62.txt
466fbb55ad25ae435c0d37c76b8d658d
a6afb5054a9fd1474696407bc4edf41618e1ece3
42542 F20101221_AAAYAK leesamphandh_p_Page_06.jpg
ec3dbb13ddab4932cc53dff5a5d73cb4
a935aa7b0a8e8dc67629c042b497dad52278e60e
F20101221_AAAXVD leesamphandh_p_Page_28.tif
79259ee320fdf018a23ec347756fe1db
8d1406f0545690bf4eba3ae81d1eaf88ca5e4925
39075 F20101221_AAAXUP leesamphandh_p_Page_67.pro
228cf2e460297cd7cf1a0ca798f5b46d
e0d864f27405249ffc5dd742314a2cac529bfa7d
25101 F20101221_AAAYAL leesamphandh_p_Page_07.jpg
b4f95be87863275a9f08c5d333b9cdb3
74e56c14b5dbc4ec4c5cf5ac235ac90fd7578790
F20101221_AAAXVE leesamphandh_p_Page_16.tif
6c620cc885119e0f6e510fcadf6c2b3c
7e91a8c39498f007419b271005a19a222c7f1476
1909 F20101221_AAAXUQ leesamphandh_p_Page_17.txt
429246a70a2118f7ccc28525b8a31c6e
e9b4b2e29a37e206ccb48d8723f457d7a4e449b8
F20101221_AAAXVF leesamphandh_p_Page_02.tif
eff2c478116b637cbac61d6db8030493
a1d2df036522e28a3a75a442c918fde24803c3cf
1051976 F20101221_AAAXUR leesamphandh_p_Page_88.jp2
eed254669956a2b61166eef99366cdbd
f0d5615fcb32fb679b74fac1cff2297e12482d65
77747 F20101221_AAAYBA leesamphandh_p_Page_25.jpg
e930584ec85216269a3eed402b9fcd1f
104c485d337be4fc78fd9f18b3426dcb90fdded3
91806 F20101221_AAAYAM leesamphandh_p_Page_08.jpg
f87e6d4f80fae53ef4413135ce868ee8
05c148f492ac553deac68ca9082226588ae63c3b
224061 F20101221_AAAXVG leesamphandh_p_Page_01.jp2
bbae94485721dcfaad845e28e331fe3c
c2cd0d65f5b8bcae04349906ee22e09ecd045969
1754 F20101221_AAAXUS leesamphandh_p_Page_35.txt
3716810e1957824f5bc8f73067491ff6
3ee5984e0584bbd89dd123c16a46861942228c93
78794 F20101221_AAAYBB leesamphandh_p_Page_26.jpg
7a0ebbc3d776c73ad98524c0bb7d0376
e6bd7dd4496f5afec58977ff980f108ff8baff63
52924 F20101221_AAAYAN leesamphandh_p_Page_09.jpg
ca60c6d1c16c7791b6b79ea688c00a70
9224ee95c33b99c15523f2af42899fa75147053b
F20101221_AAAXVH leesamphandh_p_Page_07.tif
7f3583772eb7067598b42ac3ceb3c535
61bf0872144239d0f7e662bccf2800959daa07d4
46142 F20101221_AAAXUT leesamphandh_p_Page_75.pro
8f1d00c0b749f096a758d002023f6810
970ed008b9191bdf4304c68c215fd330c9d94209
72051 F20101221_AAAYBC leesamphandh_p_Page_27.jpg
330a14d090534fd60b3b56fc442c7586
a1bf26b61c1120a6b169173cfdc6af1c97d40ef6
106100 F20101221_AAAYAO leesamphandh_p_Page_10.jpg
348f1f5c05dae2af7d200141b496a17d
bf7022601d6172584565c4b00ee23fa995a06433
1684 F20101221_AAAXVI leesamphandh_p_Page_67.txt
d2c9412a1f81364d72ae5e51423cd1b0
43fb003b1c98e66ab81c87756a24b5768e4e0197
8809 F20101221_AAAXUU leesamphandh_p_Page_34thm.jpg
8729f230a736e6993c55c671c29767d1
34aea80d22cc777d62fe00718dc07a8f75832179
91984 F20101221_AAAYBD leesamphandh_p_Page_28.jpg
b6f4882473a9fa23d199f9556527e5b7
eb90a45fed73169aa5174a6e22f22144507f9c9e
56070 F20101221_AAAYAP leesamphandh_p_Page_11.jpg
75ed00de0507e4fddaefa6f9547377ed
8c92896b0e4cde565278b164d1a74cd43ec8f5df
78 F20101221_AAAXVJ leesamphandh_p_Page_85.txt
8c0150ae25e7f44b2fdef9f3bfe57217
d215624af04ec368c8006e80eae30265cc5f6ba4
27526 F20101221_AAAXUV leesamphandh_p_Page_05.QC.jpg
225898020798413e05128db5779bd369
67590652c601d9c9d6c3a1a174c167b016f0ee29
86468 F20101221_AAAYBE leesamphandh_p_Page_29.jpg
727ef0818f1d631bcf6ba64bed105f8c
a6209756998065623b23da45cd62382ecab2e0ea
103853 F20101221_AAAYAQ leesamphandh_p_Page_12.jpg
2e5eb6d251bff4a3c15263f945952cb2
697cac972d2dc2af77b11ddee1a81b986a80e39b
4351 F20101221_AAAXVK leesamphandh_p_Page_09thm.jpg
bda3fd05488eae36a7c7c661e4c72a46
cf45665f8a2394d9de4200a41ada2b705c765143
F20101221_AAAXUW leesamphandh_p_Page_47.tif
8a69bb3f9555ac671cef9924d0c188a0
d01c6ed865bfc87e37e9c651dde2176bbff77931
85756 F20101221_AAAYBF leesamphandh_p_Page_31.jpg
935dda2b7873a3dfc5e909aa7a2e3e05
9641e0454504937ea75e8d9628194d17bc389c66
102851 F20101221_AAAYAR leesamphandh_p_Page_14.jpg
a2a4f9e5e6e46c7f6c61e4b8415e8209
4b2207a0c646e02037356cfe84c85f43c98d49fb
975904 F20101221_AAAXVL leesamphandh_p_Page_19.jp2
9fa0ad5e8671cc9bd30bd361d71f3462
8f6bc0a36feb2ced597f55fe805cd86fc24f4499
F20101221_AAAXUX leesamphandh_p_Page_88.tif
8fc00837f42ee1503923227382e148c6
e9c2341b69279ee145657c44414684d1eb9cfe3b
77679 F20101221_AAAYBG leesamphandh_p_Page_32.jpg
5f8d77c8944931659036303f35d69adb
c75c8273d5edc131b6ed5ab951ff86bfc289c81c
7107 F20101221_AAAXWA leesamphandh_p_Page_71thm.jpg
d44eab5ea7c4505fcc2ceba50c201c3c
e4ed27e167e6f4b14bded54591fdf77f08e3ab67
F20101221_AAAXVM leesamphandh_p_Page_27.tif
7894e81ddd549f41ad35637388417f0c
85740c1e889f9a428d4d8752600450099c6da82e
6552 F20101221_AAAXUY leesamphandh_p_Page_27thm.jpg
bec997d17ba90086605717d9e4c0322f
26ae19fa2b284500f3b939d0672836e7e98e2704
110123 F20101221_AAAYBH leesamphandh_p_Page_34.jpg
8bc01862b4515f10735663eb7b31cbdf
826dbc3027dc0b8871f2a531ca91be6ddcd4dd43
7956 F20101221_AAAXWB leesamphandh_p_Page_36thm.jpg
a9c67bfac7dbb776a2b13d2847ca1bd9
4b93c2210f2bac010b04d09a3357c29c5c9186e8
71491 F20101221_AAAYAS leesamphandh_p_Page_16.jpg
4105571083dd08f404f3d27b64ac2637
9d0811b22bd45cdf3af4f7d9f05b678df39e4d1e
6061 F20101221_AAAXVN leesamphandh_p_Page_86.pro
eeabb56b23d1f68276e97fe703853b23
bbce7fdab7e126a1596b48fcabfce77cbca5edcd
F20101221_AAAXUZ leesamphandh_p_Page_87.tif
e4062dac1e56a9a38b6d950878180a22
99663af58c9c0c8b22dd894a5a5094cc78ab288f
90554 F20101221_AAAYBI leesamphandh_p_Page_35.jpg
324b9fa704659928abde3f50dbd7444e
0dcc4a940fe460d290c36af08c853f2c4b553132
1051977 F20101221_AAAXWC leesamphandh_p_Page_89.jp2
3517bb71dabf015b62add2bf89077090
5937455e6d9a98c9cca73b8f8deeda72cf38925f
93399 F20101221_AAAYAT leesamphandh_p_Page_17.jpg
585db272e9e76a8db85ed28d96113b7a
2ebceaa0266abc1ad8f118a6b2c104602a5eee3c
27368 F20101221_AAAXVO leesamphandh_p_Page_15.QC.jpg
131be9c34503b0598e08f9ff9b8861c3
e2b37454b58befad4caab4c2dea01e41a4ff3c98
95140 F20101221_AAAYBJ leesamphandh_p_Page_36.jpg
ee6df51a3051a062bd3d22abf85557dd
4fad1ee7c7ced511eb70923c45a4c3070ba98e2a
95918 F20101221_AAAYAU leesamphandh_p_Page_18.jpg
704d3b2141eb94f121bf4b8de77537f4
c5ff911aa9992bbc4462fe97c543e9fdcf78c322
786517 F20101221_AAAXVP leesamphandh_p_Page_25.jp2
886f608ba6ae435a419956575cfe1165
ba558b5ca9ebe206c6c072cdf38631a9dacee198
83562 F20101221_AAAYBK leesamphandh_p_Page_37.jpg
f3660ab19f3e8a08a47b2c7c0b0f9b92
302af9e7cf1f3d30ad4cb6f7262b42f1adbee388
F20101221_AAAXWD leesamphandh_p_Page_65.tif
5a05cd77a390768309d8134d975c222a
b5480a5a3f4187ab3a21f5e61bacac8b11df8669
90202 F20101221_AAAYAV leesamphandh_p_Page_19.jpg
e65293623862a205eb09dc4e6248f030
dd628396b684cd4e1c871a3a7f3f9f9a74323f59
27029 F20101221_AAAXVQ leesamphandh_p_Page_52.QC.jpg
3d675fe67f9a939362a54992437ed7ba
c259a3cc760d9807aff85fde404716d723ae6331
85900 F20101221_AAAYBL leesamphandh_p_Page_38.jpg
1c7402a0890f63eb406ea96c4878a774
9ad0e0fe34a76b77c96c5bcf1472ff2eff4701c6
1419 F20101221_AAAXWE leesamphandh_p_Page_81.txt
19a933f678fcd19f31030474535e16c6
a2f13c6fc0588fe6bf69b616f92f5c5a4fe10101
80926 F20101221_AAAYAW leesamphandh_p_Page_20.jpg
1d7dd5ebc5128813bdaefe5f3df49258
91deb13e0b6292aabea882510f5d58d437d3a4a4
93942 F20101221_AAAXVR leesamphandh_p_Page_75.jpg
afa6bf7cffad87ae26b489f4b147c9bc
76a4ffbb765a0d8f1b5be4a12c0761c3efb3ae30
88525 F20101221_AAAYCA leesamphandh_p_Page_55.jpg
9c09c0eba3ea1504403f9a68b6d63194
8a4aba8bce911885aecbe6e780592646ae9215c4
61561 F20101221_AAAYBM leesamphandh_p_Page_40.jpg
290a2d11ebd6a298e6c2979c2c4df904
31a6b90d6bd88bfbe6234ada621298d3235b87d0
900136 F20101221_AAAXWF leesamphandh_p_Page_69.jp2
97bed2ffda0838021d5162c3dcbc1e5d
a609c121587a407dd4ebad7e369930ab42ffb146
85016 F20101221_AAAYAX leesamphandh_p_Page_21.jpg
f21dd3c79b7ba4eb7bcbda0e520bb3ce
50ceee5cb08cc8a9a645b049fb7c6bb5829ce257
602067 F20101221_AAAXVS leesamphandh_p_Page_80.jp2
c4ffe112313bb5ad10dcc768b653090a
7eedfc4fbeeecc6757bc80126fdb6d003df4ece4
96099 F20101221_AAAYCB leesamphandh_p_Page_56.jpg
3be519f1118efde140fa07f90c8ec29b
a264b392d7742db3c4a35ab332f80ba216b4823f
F20101221_AAAXWG leesamphandh_p_Page_08.tif
945fc44b2fe75feb629886a1034beda7
e5ab0d5ec65cec3d9282a363248428470ba24351
87322 F20101221_AAAYAY leesamphandh_p_Page_22.jpg
b0266b9059333a1d66b1bc2810036c9b
f25772558dd1baca322b04485ab60a30fce3d3c9
F20101221_AAAXVT leesamphandh_p_Page_74.tif
761f35f530ff501d128eb798912b8a17
fc081432481629b2cf75fa045619a70b9f792fe4
62689 F20101221_AAAYCC leesamphandh_p_Page_58.jpg
2be8926916f4bc22454bf1a1ced98a3e
2396c009610285a6d45cf6d5e7a2d5229b783814
64687 F20101221_AAAYBN leesamphandh_p_Page_41.jpg
2c1819bb84dbb3484ed8f851ab1bb6cf
63422bd3f83d63b1acf6eb86ca5f11e0d08542fc
26801 F20101221_AAAXWH leesamphandh_p_Page_24.QC.jpg
bbd84821c04daa0b9e7deef681ad5d61
63a2a9233828f455d1420df26a36ad1f58f11b58
82633 F20101221_AAAYAZ leesamphandh_p_Page_24.jpg
21e1ac35231a92a582c120fd8740526e
54401ab3a6092a52368f5f529b1079a8465e6a09
1449 F20101221_AAAXVU leesamphandh_p_Page_50.txt
16cd1bee928f02f32ac06aaf0b94db0a
d41aec8213fcafb8e9e303f1bc96dc85dc9039b2
13822 F20101221_AAAYCD leesamphandh_p_Page_59.jpg
181fc3b388fd99489aad12e82cdc6438
c7dfc50b8382bba15fed8058844830b08263f756
36653 F20101221_AAAYBO leesamphandh_p_Page_43.jpg
84d48637a315d25924c43cd6c213779f
a33d8f79e2e5cf0e61a8f7e801eabc83f743fc95
F20101221_AAAXWI leesamphandh_p_Page_36.tif
1af4c2b66113b0cb04950d4405b05f77
c96ba2937b162e05c52c6663acca6b6374996942
7423 F20101221_AAAXVV leesamphandh_p_Page_74thm.jpg
e9fd61abd256e99643ba4cfc14fee735
ed362984cebb565b8db1d0dfd2718b720b8cb2dc
103979 F20101221_AAAYCE leesamphandh_p_Page_60.jpg
1372609b30303801d56224657c44f0e4
97223f75450943829f5d2333d81c3501b5145ec5
110361 F20101221_AAAYBP leesamphandh_p_Page_44.jpg
636f1ed3843469437e663e44f568a974
11202af34e1c00e15825439e7b6f5598e2c9a92a
F20101221_AAAXWJ leesamphandh_p_Page_37.tif
28f9545ce33fc766575c16d432b83d43
a109defd2efa9ebaff15b997c339f866d5bb78fb
8484 F20101221_AAAXVW leesamphandh_p_Page_88thm.jpg
008e20b0017406c87bec9ae9260e9bcc
1ec9ec1ec24ceba5fe3a35eca9000d71e2acbba7
97124 F20101221_AAAYCF leesamphandh_p_Page_62.jpg
ae3f1d74a6ece827c686627efb1e84a9
6240d280249391e57f9c74e0131c90584e545c06
109653 F20101221_AAAYBQ leesamphandh_p_Page_45.jpg
744f8854d68c22dbbc082315c98ce36e
06102d72a0b20237ac5b9e14f6e24f693f9d7a7a
1051943 F20101221_AAAXWK leesamphandh_p_Page_78.jp2
34a9cc93c762ccb614b4bc6afc564967
1133b0d6c2bcb08c27de1ad7b6fe5f6db258c434
3046 F20101221_AAAXVX leesamphandh_p_Page_85.QC.jpg
fa2a6a9a9e3bfe6afb10a1f439ebf868
86019179888969595d8db19c97c904f68bbcc049
72934 F20101221_AAAYCG leesamphandh_p_Page_63.jpg
d1ec0d9faed7c32b8101ac96a80b73fd
b3e3ba5663c80e1e560c235a4c0af6d7ad103b18
6172 F20101221_AAAXXA leesamphandh_p_Page_41thm.jpg
01efd205c9c551234dfdef4c4c309222
31e1050989abae646b5e126089ac714a864f9c7c
103353 F20101221_AAAYBR leesamphandh_p_Page_46.jpg
73f8fbb4ff8b6daf11176725b8a41cc0
9bf5fc9b8af5f0b4386d2917f60b6aacfa70847c
57927 F20101221_AAAXWL leesamphandh_p_Page_42.jpg
45b19093b3470a5f92ccd402e322136e
ef80395d4909fb8f3324eafe669036a69c70844b
1663 F20101221_AAAXVY leesamphandh_p_Page_59thm.jpg
5d3dfb0b43047a75073472cb42b4e6af
2d0520b1e583ea876d8d4b8453d96698cee88e6a
90340 F20101221_AAAYCH leesamphandh_p_Page_66.jpg
b3bd57e291b7c843751bf5c80e6fdd76
44d4d8909308b075b483a52f0ee80e4fe9470130
1742 F20101221_AAAXXB leesamphandh_p_Page_26.txt
cffc84b3708f1eb8333c06014c68c662
209c4dd88fd3ef15824bf22581e7c6e8df79ad35
87997 F20101221_AAAYBS leesamphandh_p_Page_47.jpg
84ee6565bad4357aa1a2e4a3e38628e9
77da5913e1d9ce686055cff0110ac81995e4f127
87203 F20101221_AAAXWM leesamphandh_p_Page_72.jpg
d932b89b4fa31b7c6afa7c2ae06c6d50
1f718c454a3c55ec9be4c0a50cef8e066d109e66
25463 F20101221_AAAXVZ leesamphandh_p_Page_26.QC.jpg
f4cb0b9bdaf05ad98f6667f9a7e799e7
bcde13ad23d28708ad8341d82538853cc02d9658
77846 F20101221_AAAYCI leesamphandh_p_Page_67.jpg
24b558b6285cf20a9202e85f42ae5943
07d4a8635499f9abb23eeaf865bca0c024c30ac3
7848 F20101221_AAAXXC leesamphandh_p_Page_56thm.jpg
2356b7b3bd953961ae6d949406095ef6
9aa936634039c994877f55f712b1965816554b56
86568 F20101221_AAAYBT leesamphandh_p_Page_48.jpg
ce3e3c9690f9be5620894e3d1d9fc2a9
4a4e5ffe6c218eb061050824c5e88592a389409c
108547 F20101221_AAAXWN leesamphandh_p_Page_13.jpg
f731e8b1934b0140fcac05a4797d03a3
4f9673a8cc216fdbdc9f1f45fcaeb7db5619bb04
94682 F20101221_AAAYCJ leesamphandh_p_Page_68.jpg
ff8aaa2ae2d02485ca550fbd2113d5f1
99b06c183a0f2308f867b88ce236933ea6024489
26133 F20101221_AAAXXD leesamphandh_p_Page_73.QC.jpg
6d1639df5295284b000658aa7cf1b178
4b55e1fbe0a044b96ff184711e4cc8e041780875
94794 F20101221_AAAYBU leesamphandh_p_Page_49.jpg
15764bfcf10a4dd0af5c5f1bccedc936
6f87e365574f1b88fb7e7ecf8bdd6a8f5ccbfd38
1919 F20101221_AAAXWO leesamphandh_p_Page_56.txt
48fb51d9d6b19beb194c615cb09d46e3
cc5cb0094f90f6198a618808272f4ba15f55a07f
84017 F20101221_AAAYCK leesamphandh_p_Page_69.jpg
da26bb9d882c69c945e652577ccc3749
390068e873aba32dc8fa3c69857c93b7968c6411
69446 F20101221_AAAYBV leesamphandh_p_Page_50.jpg
15f5d78ef05db32ed418bd810080c677
b4751b452cd8922d6777fffbbf82ab1fbad7d359
24473 F20101221_AAAXWP leesamphandh_p_Page_09.pro
96270f6907846434dd7aaab4ef907a4b
f18afc54dda09e228a02288cb619a6bf7b2fbabe
71675 F20101221_AAAYCL leesamphandh_p_Page_70.jpg
38fe45e55dfca93a8ad3ea39fdc0be3e
8690ea8502035d63c082e7924abb9c04b2742f6c
654591 F20101221_AAAXXE leesamphandh_p_Page_84.jp2
a8b5e4527d257702595fe476e9a99412
9ce1ca403b4c13f9de2e16a78df66ec6ce7c3398
83368 F20101221_AAAYBW leesamphandh_p_Page_51.jpg
a06b2ef1aaba13f12fa53e3015edd5b0
b710f4eef643b997fee24710904803c277e4b973
87190 F20101221_AAAXWQ leesamphandh_p_Page_23.jpg
4349fb5fb3215622347c4f5858a3b1d4
22361e00748b7b653c49ca30039605fe7ec799e5
74882 F20101221_AAAYCM leesamphandh_p_Page_73.jpg
d1aa66943317cce50d4b6db1f00a14b9
2f6dae2360fe988d36633961b6419e6c660fa713
97611 F20101221_AAAXXF leesamphandh_p_Page_57.jpg
dddff5cccc539f9e804dc02180bf5255
51e3d3da25fd124374964b9a03d2cda2c95ec56b
82420 F20101221_AAAYBX leesamphandh_p_Page_52.jpg
e4dc600150e0420532abd212fa04a525
72a3e7c50d91b941b02b9014b1e6aeb72e0d4949
1836 F20101221_AAAXWR leesamphandh_p_Page_48.txt
b8a6678403edc973735229d1271da069
99873477c86bb65db7e43cdca5e89042c7bd81f0
907714 F20101221_AAAYDA leesamphandh_p_Page_04.jp2
187bc5500c0796ad955d9c56b8693c9f
0cf16f3994d8515aaa665af902350b437486b0d8
86615 F20101221_AAAYCN leesamphandh_p_Page_74.jpg
0575c85954b2c8d5ac9d759bab8150ee
7099ff01109adb027639205e8420d9977906a8b3
7940 F20101221_AAAXXG leesamphandh_p_Page_48thm.jpg
e3517d066b22973c4a65d5f2d310465c
cf089f45032d650a7b5b3bb8148d5f2468a1d459
76147 F20101221_AAAYBY leesamphandh_p_Page_53.jpg
33b7df5c8b7e6abab6d5afda895c3e49
e9e5aace9288592c0745df009a00db0239abf7c8
20453 F20101221_AAAXWS leesamphandh_p_Page_58.QC.jpg
dcf13839d404decd0ac656794f576426
4bcd65e852c405f1610fcb439a806c94550687c9
1051975 F20101221_AAAYDB leesamphandh_p_Page_05.jp2
02939ffa811341b3c617efc006885b92
da80805b5334a929d6d9e1a35eb0b0626500c420
1839 F20101221_AAAXXH leesamphandh_p_Page_15.txt
e0219021213ffb809247e8e8fc7c0b05
121578c5f1baf077f52f5609cab507e61d16856a
91827 F20101221_AAAYBZ leesamphandh_p_Page_54.jpg
307fbd7a197bd748a203ce129f17d51b
bb69544703b0e292bfbf0edc4322bbd0e9bd0ca1
1921 F20101221_AAAXWT leesamphandh_p_Page_65.txt
0a0e1b4dff14e20d3d78bd080482e596
12345c0769485823d0f861d7422a31f55d1748f8
742483 F20101221_AAAYDC leesamphandh_p_Page_06.jp2
00baae57e02dea34d07899326ba61dea
fb0160b0c596b3bebb814eb209709c68186cb7ba
107234 F20101221_AAAYCO leesamphandh_p_Page_76.jpg
9d06001cd56b3c45385e681a344c3174
f9a6078d07e3308baabcaa1e095037804ee6efe7
46354 F20101221_AAAXXI leesamphandh_p_Page_49.pro
75e47b6cb6c2106fb4724c53b6a3ba0e
bd00f8f4fe2f356a95adb435db2d7e14d538d42b
F20101221_AAAXWU leesamphandh_p_Page_82.tif
6b30bbb30ad28643ae898feb38fb8841
9dc5e42b9d5717be73680b8538ebe228ccb67546
993428 F20101221_AAAYDD leesamphandh_p_Page_08.jp2
e62e2ef817c8a2bec5556274e8ff2bb8
851606656cbc8f23453f518b6d6e4ca5f1367da0
104520 F20101221_AAAYCP leesamphandh_p_Page_77.jpg
33170a8160a9a9ab124547f78593ee09
a13717b9ab0b77aa4926a4694b0e9a0f689b7e80
53716 F20101221_AAAXXJ leesamphandh_p_Page_45.pro
738282ae1320c3cb55c601a4caa70599
04865e8a92c96f323be5835b41e0fd516c85a60e
F20101221_AAAXWV leesamphandh_p_Page_05.tif
abef4c5c42cf1135a46dfe731a0337f6
f207303d5c93fe69fbaa4cf4fd33c02befd6960f
557772 F20101221_AAAYDE leesamphandh_p_Page_09.jp2
3b96ee7d133b98b7796196e73d17ffa3
b4785b19d4a40e8e35d8456a40007e795301b236
60812 F20101221_AAAYCQ leesamphandh_p_Page_80.jpg
35ca718ee5d8f2eabdb73c3ad2ceadb9
cdcee18af2244fe53d0023800cb9d5e1272916c0
1606 F20101221_AAAXXK leesamphandh_p_Page_04.txt
b061e924aeae1dc06a273da224c2699c
7bf1894ec1f1a3a509041154fee6d32845d74bc5
13498 F20101221_AAAXWW leesamphandh_p_Page_43.QC.jpg
514122d098fa49d89751913657783e2e
cace1d303393b09809b3c1867c8a776e3d389957
1051969 F20101221_AAAYDF leesamphandh_p_Page_10.jp2
33c6a843d17d400522f6a53426ad8c6b
fa6ce3818e1415f8834ee2b4fc71b5306bb3acbb
F20101221_AAAXYA leesamphandh_p_Page_85.pro
2fb16cb0aaaa005c1b4cf76d821779e2
8f65a92bf17bbe493d953ff542340daf909b161d
62738 F20101221_AAAYCR leesamphandh_p_Page_81.jpg
99e9f7bb2ef850801a17014c2fb7bbc4
f6ede57e9917e56c09f07096a9e2007e1943aa0b
4345 F20101221_AAAXXL leesamphandh_p_Page_43thm.jpg
2528e7c0c75afeb9d949bd8c71ec472b
6fdb2da13757509a6accae74021ccf915e833e28
8618 F20101221_AAAXWX leesamphandh_p_Page_44thm.jpg
43cf2e33d1540adfeef9d634b4a177fb
1e494e3c32a937cd1fb9984e8ef27fb7e2fda648
591475 F20101221_AAAYDG leesamphandh_p_Page_11.jp2
9afb20ed1ec41f57471c74d11ec805a0
c7e032ee41749f5fa88d27ae685df35b9176734e
49783 F20101221_AAAXYB leesamphandh_p_Page_60.pro
5c353a66c8e5be362c29454c9e66f073
70d4d4120e870ea2ee08ad95e8f173d527302903
70279 F20101221_AAAYCS leesamphandh_p_Page_82.jpg
62909bf8909c538c91dfc4721677ad0a
ce86985c0e4450a5b7d8b189aa00989b08fb9e18
36880 F20101221_AAAXXM leesamphandh_p_Page_61.QC.jpg
0f1ee4feffaa039a8a735f24543b4d83
a962e462381eee3f0451efe6ebf0193ce6790030
4233 F20101221_AAAXWY leesamphandh_p_Page_91thm.jpg
ca12bbbac77e8cd6deef520d3fc41dab
3eb7fb46c59f08f71fba9d43e31f12f7f48b9d86
F20101221_AAAYDH leesamphandh_p_Page_12.jp2
134aeca82364f093af5613b51b91f574
e5b0bf1efe77a143562b29b1f086cfa4f6440a50
8904 F20101221_AAAXYC leesamphandh_p_Page_61thm.jpg
db348a8c43732232030f728dd09ed477
33a6f54ac4f2f70942353fd966108d2c2c00f2e4
54563 F20101221_AAAYCT leesamphandh_p_Page_83.jpg
f265fc3e8e0b1645efdd42430970ba7d
b3f2e29d92e51c64bce472cd3175224c60f1d1a9
6967 F20101221_AAAXXN leesamphandh_p_Page_79thm.jpg
60de20c922e646aedfc26a80568c0559
bd5874fa9fdc30617cc8f7fb662b0346c11ede9d
7045 F20101221_AAAXWZ leesamphandh_p_Page_67thm.jpg
ac6a82b316edb410a6ba64fe1a66c1b1
6ee9304a4ec94d3efab018338084c76c615b6a13
1051962 F20101221_AAAYDI leesamphandh_p_Page_13.jp2
007ab4877a17d821dd6650e53c65c586
0554bc3b34ab9941b8fc39441184efdfe9d27af4
50494 F20101221_AAAXYD leesamphandh_p_Page_12.pro
fa2ccd0d3df3d057cfaacfde8b50195c
b80137533bbd33c29f8e9f349ee592fde7c37ae9
65280 F20101221_AAAYCU leesamphandh_p_Page_84.jpg
ccb5a3e7b01036ca1806220df721b49f
6ef271ab1089aedf70e14f99d8737651891b453c
97299 F20101221_AAAXXO leesamphandh_p_Page_65.jpg
09f696fe4eea2c8546727608b4cecabc
b1c71c6e5b1ff1aa0e16e5c880d396f38362d129
F20101221_AAAYDJ leesamphandh_p_Page_14.jp2
11621569c51a0a2ee9b8955e4e1b2d0c
1d2bc8b210b06909e418ea042c2e48e88b529eb5
965 F20101221_AAAXYE leesamphandh_p_Page_91.txt
a4b23f189d677aa1a6ec1eb1b19c0267
09cb7d1a4824f3831d05679ef4382b1cb2f2b5cf
21367 F20101221_AAAYCV leesamphandh_p_Page_86.jpg
c958fd44187a21249f4c714ba07375a2
0b6bae93d55b899b5eb512192caac3d98ecc6e0d
107202 F20101221_AAAXXP leesamphandh_p_Page_33.jpg
67159f177a8a69e5be3c95434dc32bc0
522f2242147d4428a456ffd499ce2c4d9b3c83e9
930262 F20101221_AAAYDK leesamphandh_p_Page_15.jp2
66538b98ad478fa750051cdca29ef0fb
fdb1d888d41c03ccd2711b8e554025a956f36e00
122614 F20101221_AAAYCW leesamphandh_p_Page_88.jpg
5651b0eb48fbbe02f7b52412fb138843
8547a12874c32ef6b7ce1f783bb49fbb8d198c0a
35739 F20101221_AAAXXQ leesamphandh_p_Page_34.QC.jpg
65cc32b37ff582c9912dad94739973af
c26bc91ebdaa50c1782c2fcca8b1a758d354b802
752549 F20101221_AAAYDL leesamphandh_p_Page_16.jp2
cd1d99e955d007e4ff04bf3b0764de11
4221f39a36cfe59857d14b7ce7de7005def5f28a
5049 F20101221_AAAXYF leesamphandh_p_Page_90.pro
765fcdadb11541aa8c73f54ee254d305
8f929d44a55f4a3a5057738ab6805f70eb2361c5
13692 F20101221_AAAYCX leesamphandh_p_Page_90.jpg
49c7c00ea958d562130d44e08aa144a2
414c8bd388701c7d2474fdffdc7808202755fba7
27847 F20101221_AAAXXR leesamphandh_p_Page_71.QC.jpg
eec320fe1fd6e7b8252d37807970d32d
963f6b68260bfdf015bac2b595d60b1b39070582
1051950 F20101221_AAAYEA leesamphandh_p_Page_34.jp2
855e9c6fa283a805a8142ed38994f8b7
14d050fae2d1866b5ee6af574f8c7d424bb05b22
1020508 F20101221_AAAYDM leesamphandh_p_Page_17.jp2
059866f30d5a7c212df246e2664d3b42
74f8a524f479e9f82a509e2f795c6733378b29cb
952 F20101221_AAAXYG leesamphandh_p_Page_06.txt
68c9566d4ec3b46b4d817bfc4a028c01
f672edcedc67c3ec52db7ab316330a9e3d283e03
30363 F20101221_AAAYCY leesamphandh_p_Page_02.jp2
38625cf7380205f3d3cb3e871959f406
e7aec348e8f61f68583c2ab49ec4761f2eafd45f
121589 F20101221_AAAXXS leesamphandh_p_Page_05.jpg
e2bfe576a3f977b151cca8122235277c
591f1d6869dd946e8af5a7e2a51fb19d1adf20ba
877667 F20101221_AAAYEB leesamphandh_p_Page_37.jp2
6b022faa8dac19df5ddb8e8bf0108c0c
4b26b8a0619732051eaeca49ebc52160347a27f8
F20101221_AAAYDN leesamphandh_p_Page_18.jp2
63de1eae608f24058441abefe12c37bc
e373973a0aa372fb4a0e78a40c5ee63d51d51907
9016 F20101221_AAAXYH leesamphandh_p_Page_89thm.jpg
e9d984d1b987aa96cd43668f59e9d7eb
86d3d5c31f276d8e690d7d34b8b2e08f87e35e13
44796 F20101221_AAAYCZ leesamphandh_p_Page_03.jp2
2be9ef0705e240e9473a7e4e2d3dcba6
bd220e7ac6d6bd6c54e54f9fa1f33e08dc6d1007
1979 F20101221_AAAXXT leesamphandh_p_Page_87.txt
1f82c9e7ba5df88f988cf1b91205e111
e241777f1ccd25ca3835efd0ea32551ea691b5ea
899664 F20101221_AAAYEC leesamphandh_p_Page_38.jp2
e21e08f215cd1073ea9e774ed44015c0
179f2f1b8547077941ab8a942f0f9e6c98323286
867763 F20101221_AAAYDO leesamphandh_p_Page_20.jp2
ba2b6c93bc97085f086c9a42111ebf6f
fc776de1fd347faea954756c1f10e9a49eb39910
F20101221_AAAXYI leesamphandh_p_Page_91.tif
1612beb1e0cd752eaf8854b946feb315
4367dd1959f40192391ccea38bd5bc38d00bb612
123 F20101221_AAAXXU leesamphandh_p_Page_59.txt
2871435e966ad0b3fbef8b7962c1069f
f043aa14c0c5faf1006c0a756d1547743f8bdfbd
722500 F20101221_AAAYED leesamphandh_p_Page_39.jp2
411223d9e9086cb64b1ed02fe7c8ad8e
5ce544bf0a1d643a1a327b0371719dfa4e4becaf
48358 F20101221_AAAXYJ leesamphandh_p_Page_64.pro
b4b63a77c7741ea2ab33fed1c641c546
06e0b720c6e094f49bfa1aef7adbc57764071dbb
87097 F20101221_AAAXXV leesamphandh_p_Page_15.jpg
20c87a2e09d5d86d463d8c47ac93b31c
c362c33da164628df49fdd7b2ccc1cb24fcceabb
603467 F20101221_AAAYEE leesamphandh_p_Page_40.jp2
c026f1eb0c193b7404ac7facfc0b8c40
ecb3f45ebb7bddf13f1ef4a98ab428ec46ec9aac
922978 F20101221_AAAYDP leesamphandh_p_Page_21.jp2
ffb8b36aca5c1b3b1c3590d1a20132a1
6b7086d6e9e73057608719c4f182c013f261404a







PATENTS, NORTH-SOUTH TRADE AND GLOBAL GROWTH


By

PIPAWIN LEESAMPHANDH















A DISSERTATION PRESENTED TO THE GRADUATE SCHOOL
OF THE UNIVERSITY OF FLORIDA IN PARTIAL FULFILLMENT
OF THE REQUIREMENTS FOR THE DEGREE OF
DOCTOR OF PHILOSOPHY

UNIVERSITY OF FLORIDA

2008

































O 2008 Pipawin Leesamphandh



































To my parents and my husband for their love and support









ACKNOWLEDGMENTS

First and foremost, I would like to thank my advisor, Elias Dinopoulos, for his help and

guidance. He has inspired and motivated me through his valuable ideas and suggestions. I am

grateful for his time, patience and knowledge in economics. I would like to thank my supervisory

committee, David Denslow, Steven Slutsky and James Seale for their comments, suggestions and

for reading my dissertation and attending committee meetings.

Additionally, I appreciate the help and support from my fellow graduate students, office

staff and professors in the Economics Department at the University of Florida. I thank them for

making my years in Florida a memorable experience in my life. I am thankful for financial

support from the Thai Government and for assistance provided by the staff of the Office of Civil

Service Commission. My personal gratitude goes to Dr. Kanit Sangsubhan, who encouraged me

to take this journey and believe in me.

Last but not least, I thank my mother (Dr. Wipawee Jampangern) for her endless love and

support, and my father (Nop Usawattanakul) who always believes in me. I thank my good

friends (Dr. Saijit Daosukho, Dr. Kornvica Pimukmanaskit and Noppun Wongkittikraiwan) for

their help and mental support. I would like to thank the Phadungcharoen family for their

kindness. Finally, I thank my beloved husband Theerapat Leesamphandh, for his love and

support, for making me feel like I am at home in Florida and for always making me laugh and

happy.












TABLE OF CONTENTS


page

ACKNOWLEDGMENT S .............. ...............4.....


LI ST OF FIGURE S .............. ...............7.....


AB S TRAC T ......_ ................. ............_........8


CHAPTER


1 INTRODUCTION ................. ...............10.......... ......


2 TECHNOLOGY TRANSFER, TRADE COSTS AND ECONOMIC GROWTH ................12


Introducti on ................. ...............12.................
M odel .................. ... ........ ...............14.......
Household Behavior ................. ...............14.......... ......
Production and Trade Costs.................. ...............17
Innovative Research and Development ................. ...............20................
Imitative Research and Development............... ..............2
Labor M markets .............. ...............26....
Steady-State Equilibrium ................. ...............28.................
S chumpeterian Growth ................. ...............3 1...._.__....
Comparative Steady-State Analysis .............. ...............33....
Conclusion ........._.. ..... ._ ._ ...............37....

Al gebraic Detail s .............. ...............37....

3 PATENT ENFORCEMENT POLICIES AND ENDOGENOUS GROWTH .......................44


Introducti on ........._.... ...... .._ ._ ...............44....
Closed-Economy Model .............. ...............46....
Household Sector. ........._............ ...._.._ .. ......_._ .............4
Domestic Production and Patent Enforcement Sector. .....__.___ ........_._ ..............48
Innovation Process............... ...............49
Domestic Labor Market ................. ...............52........... ....
Steady-State Equilibrium ................. ...............53.................
Long-Run Schumpeterian Growth............... ...............54.
Comparative Steady-State Analysis .............. ...............56....
Conclusion ................ ...............58......_ ._ .....


4 MULTNTINAINAL CORPORATIONS, PATENT ENFORCEMENT AND
ENDOGENOUS GROWTH .............. ...............60....


Introducti on ................. ...............60.................
M odel ................ .. .......... ... ...............61.......
Consumers and Workers............... ...............62













Production and Multinationalization ................. ....._.. ...............64......
Innovation............... ...............6
Labor M markets .............. ...............69....

Steady-State Equilibrium .......__................. ..........__..........7

Long-Run Schumpeterian Growth............... ...............73.
Comparative Steady-State Analysis .............. ...............74....
Conclusion ................ ...............78......_._ .....

Al gebraic Detail s .............. ...............79....


5 CONCLU SION................ ..............8


LIST OF REFERENCES ........._... ........... ...............88....


BIOGRAPHICAL SKETCH .............. ...............91....










LIST OF FIGURES


FiMr page

2-1 Pricing structure of the Northern quality leaders ................. ...............43..............

2-2 Pricing structure of the Southern quality leaders ................. ...............43..............

3-1 Closed-economy's steady-state equilibrium .............. ...............59....

4-1 Multinationalization process in a North-South model ................... .... ...........8









Abstract of Dissertation Presented to the Graduate School
of the University of Florida in Partial Fulfillment of the
Requirements for the Degree of Doctor of Philosophy

PATENTS, NORTH-SOUTH TRADE AND GLOBAL GROWTH

By

Pipawin Leesamphandh

August 2008

Chair: Elias Dinopoulos
Major: Economics

We developed a North-South model with global patent protection in the presence of trade

costs. The model generated endogenous Schumpeterian growth and product-cycle trade. The first

model was used to analyze the effects of globalization through trade liberalization and a

geographic expansion in the size of the South. A reduction in trade costs worsens the North-

South income inequality by increasing the wage-gap between the two regions. Globalization has

an ambiguous effect on the steady-state rate of technology transfer and has no effect on either

innovation or the growth rate.

Next, we built a simple general-equilibrium model of scale-invariant long-run

Schumpeterian (R&D-based) growth, finite-length patents, and endogenous patent enforcement

policies. The latter were captured by a probability function which depends on the government

resources engaged in the enforcement of patents granted to firms that discover new higher-

quality products. An increase in the patent length raises the probability of patent enforcement;

this result is consistent with cross country evidence showing that patent enforcement and patent

duration are complements. In addition, the model predicted that economies with low productivity

of R&D researchers have weaker patent enforcement policies and lower long-run Schumpeterian

growth.









Lastly, we introduced an endogenous multi-nationalization process into a North-South

model of scale-invariant long-run Schumpeterian growth with a finite-length patent protection.

The latter is perfectly enforceable in the North but imperfectly enforceable in the South. The

model was used to examine the effects of intellectual property rights policy and globalization on

Foreign Direct Investment (FDI) and the world income distribution. The effectiveness of patent

enforcement does not effect the decision of a firm to become MNCs. However, an increase in

patent length reduces the flow of FDI and worsens the income distribution between regions. In

addition, globalization, measured as a geographic expansion in the size of the South, increases

the flow of FDI but worsens the North-South income distribution. Lastly, an improvement in

innovation technology leads to a decline in FDI and worsens the North-South wage gap.









CHAPTER 1
INTTRODUCTION

We developed three models to study various issues in international economic field such as

globalization, intellectual property rights (IPRs) protection and foreign direct investment. All

models are based on similar building blocks of quality-ladder framework, finite patent length,

and Bertrand price competition. Each model has quality leaders who invent the new state-of-the-

art product and enj oy global monopoly profit as they sell product to the world using limit

pricing. There are quality followers in each model with different patent protection policy. In

addition, all three models are based on the same innovation technology where we assumed an

increase in Research and Development (R&D) difficulty overtime in order to remove an

undesirable scale effect property from the model.

The first model is a North-South product-cycle trade model with global patents protection.

We introduced trade costs into the first model to examine the effect of globalization to global

innovation, imitation and wage-income distribution between regions as trade costs are an integral

part in the international trade flow. In the first model, quality followers in the North produce

generic products while quality leaders in the South target generic products in the North for their

imitative R&D.

The second model is a closed-economy model with imperfect patent enforcement policy.

We introduced a resource-using endogenously determined patents-enforcement mechanism to

examine the link between patent length, and various factors to resources used in the patent

enforcement sector. Intellectual property rights protection becomes a maj or sector that many

countries are required to allocate their scarce resources in order to meet the minimum standard

set by the agreement on Trade-Related Aspects of Intellectual Property Right (TRIPs). Quality

leaders receive a finite patent with some probability of patents protection. There is no imitative









R&D since the method of production of the newly invented product becomes general knowledge

without patents protection; therefore, quality followers can produce and sell products

competitively in the market.

The third model is a North-South product-cycle trade model with free trade. We introduced

endogenous multi-nationalization process to investigate the effect of patents protection,

globalization and innovation technology to the flow of foreign direct investment and wage-

income distribution between regions. Northern quality leaders received patent protection that is

perfectly enforceable only in the North but imperfectly enforceable in the South. There is no

imitative R&D in this model as Southern quality followers can produce and sell the products

when there is no patents protection and the method of production becomes general knowledge.

Therefore, only multi-national corporations face the risk of imitation after they transfer their

production based to the South.









CHAPTER 2
TECHNOLOGY TRANSFER, TRADE COSTS AND ECONOMIC GROWTH

Introduction

International trade has continually expanded and become a large share of the world income

in the past decade. This continuing trend indicates the acceleration of globalization in the world

economy. Globalization leads to a substantial reduction in trade costs which include: a sharp

drop in the price of communication due to the intense competition in telecommunication markets

and the emergence of the internet technology, an increase in cheaper and faster modes of

transportation, and a decline in barriers to trades in goods and services under the General

Agreement on Tariffs and Trade (GATT). The average tariff rate on manufactured goods in

developed countries has dropped sharply from 20 % to approximately 4 % in the past 50 years

(Hill 2002)

However, trade costs still remain as a significant portion of international trade flow.

Anderson and Wincoop (2004) estimated a 170 % ad-valorem tax equivalent of total trade costs

for developed countries. We developed a simple product-cycle trade model that incorporates

trade costs in order to analyze the effect of globalization to the world income distribution. Trade

costs can be considered as all costs incurred in getting a good to final consumers other than the

marginal cost of producing the good itself which include costs related to transportation, policy

barriers, information, contract enforcement, currency exchange risk, regulation and local

distribution. Anderson and Wincoop (2004) provided empirical studies of trade costs and

emphasized the importance of trade costs in international trade flows. In general, trade costs can

be classified into two main categories which are domestic and international trade costs. This

paper emphasizes only the international trade costs since the domestic trade costs are faced by

both domestic and foreign firms.









A class of North-South trade models has long been developed in conjunction with the

development of the new growth theory starting with the pioneer work of Krugman (1979). The

state-of-the-art dynamic North-South models featuring endogenous Schumpeterian (R&D-based)

growth have been extensively used to examine various aspects of interest in the international

trade and growth literatures. Dinopoulos et al. (2005) found that globalization, modeled as an

increase in the size of the South, worsens the wage-income distribution between the North and

the South, increases the rate of imitation and does not affect the long-run rate of innovation and

growth. While, an increase in the global patent length worsens the wage-income inequality

between the North and the South, increases the rate of product imitation and has an ambiguous

effect on the long-run Schumpeterian growth. Their main assumptions are zero transportation

cost and enforceable global patent protection.

Dinopoulos and Segerstrom (2005), also assuming free trade and Dixit-Stiglitz consumer

preferences, concluded that globalization taking the form of an expansion in the size of the

South, leads to less wage-income inequality between the Northern and the Southern workers,

increases the imitation rate and speeds up the technological change, while stronger intellectual

property protection has the opposite steady-state effect. Next, Dinopoulos and Segerstrom (1999)

introduced tariffs into the North-North trade model where workers have different skill levels.

They concluded that trade liberalization reduces the relative wage of unskilled workers, increases

R&D investment, boosts the rate of technology change and results in skill upgrading within each

industry.

Other studies relating patent protection, intellectual property rights and growth include

Sener (2006), also assuming free trade, found that stronger intellectual property rights protection

leads to a larger North-South wage gap and reduces the rate of innovation and imitation. In










addition, more integration of the South into the world economy, taking the form of an increase in

relative size of the Southern population, also leads to a larger North-South wage gap and reduces

the rate of innovation, but increases the rate of imitation.

The contribution of this model is that we examined the effects of globalization to the wage-

income inequality between the North and the South and the rate of international technology

transfer by taking into account the presence of trade costs and enforceable global patent

protection. In this model, globalization takes the form of not only an increase in the size of the

South, but also a reduction in international trade costs.

Model

We generalized the North-South model of trade and growth by Dinopoulos et al. (2005) by

introducing international trade costs. The model followed the quality-ladder framework

assuming a finite patent length and increasing R&D difficulty over time in order to remove the

undesirable scale effects property. The model generated endogenous long-run Schumpeterian

(R&D-based) growth which depends on patent length and the rate of population growth. This

study added to the existing North-South trade models by explicitly studying the long-run effects

of trade costs on the global wage-income inequality and the rate of international technology

transfer.

Household Behavior

The global economy consists of two regions: the innovating-North and the imitating-South.

Both regions are assumed to have common trade costs and identical consumers' preferences.

World population grows at an exogenous rate n > 0. There is a fixed measure of dynastic

households with infinitely lived members. Each household member is endowed with one unit of

labor which is supplied inelastically to the market. New household members are born

continually; therefore, the size of each household grows exponentially at the rate of n > 0. We









simplified the model by normalizing the initial size of each household to unity. The number of

household members at time t is then, e"t. Let L, (t) = L,e"' denote the level of the Northern

population and the supply of labor in the North at time t, where L, is the initial level of the

Northern population. Similarly, let Ls (t) = Lse"' denote the level of the Southern population and

the supply of labor in the South at time t where Ls is the initial level of the Southern population.

The world population at time t is given by L(t) = Le"' = L, (t) + Ls (t) = (L, + Ls )e"'

There is a continuum of industries indexed by B E [0,1] Each industry produces a final

consumption good with different quality level. The quality level of a product is indexed by j,

where j is restricted to integer values and represents the number of innovations in each industry.

Let Al'8,t denote the quality level of a product in industry B where Ai > 1 is the quality

increment generated by each innovation which, by assumption, is identical across industries.

Each household, modeled as a dynastic family, maximizes the following discounted

lifetime utility


U "In u(t)dt, (2-1)


where p > n is the constant subjective discount rate.

The instantaneous per-capita utility function at time t is defined by


Inu~)= n[ 'q(j 6 ) (2-2)

where q(j,0, t) denotes the quantity demanded per person of a product in industry B with

quality level A'" at time t. Equation 2-2 is the standard quality-augmented Cobb-Douglas utility

function across all industries. It also implies that consumers prefer higher quality products.









The consumer's problem is solved in three stages: First, each consumer considers the

within-industry static optimization problem.

max C A' q( j, 6, t) (2-3)


subj ect to C p7(j,0,~t, )q(j,0, t) = c(B, t) where p7(j,0,~t) is a consumer price of product j


in an industry B at time t and c(0, t) is per-capita expenditure. The solution to this within-

industry optimization problem is to buy the product with the lowest quality-adjusted price

p, (8,t)
.If two products have the same adjusted price, consumers always buy the higher-quality


product.

Second, consumers allocate their budgets across all industries by solving the following

across-industry static optimization problem.


max jAl;(o,t)q(,td (2-4)



subject to pl(0, t,)q(i(, t~d = c(t), where q(0, t) is per-capita quantity demanded for the


lowest quality-adjusted price product in industry 8 at time t, j(B, t) is the quality index of the

product with the lowest quality-adjusted price in industry 8 at time t, p(B, t, ) is the price of the

product and c(t) is per-capita consumption expenditure at time t. The solution to this static

problem yields a unit elastic demand function. Grossman and Helpman (1991) provided a detail

derivation of this unit elastic demand function.

c(t)
q(B, t) = (2-5)
p(8, t)









Lastly, consumers solve the dynamic optimization problem by substituting the demand

function from Equation 2-5 into the instantaneous per capital utility function (Equation 2-2) and

maximizing discounted life time utility (Equation 2-1).



maO e ""In ct) +In -I p0 t (2-6)


subject to an intertemporal budget constraint z(t) = w(t) + r(t):(t) c(t) nz(t) ,where z(t)

is the level of consumer assets at time t, w(t) is the wage rate at time t, and r(t) is the market

interest rate at time t. The solution to this optimal control problem yields the following well-

known differential equation

c(t)
= r(t) p. (2-7)
c(t)

At the steady-state equilibrium, per-capita consumption expenditure is constant. Therefore,

the market interest rate equals the constant subj ective discount rate.

Production and Trade Costs

Labor is the only factor of production and perfectly mobile within each region. Labor

markets are perfectly competitive in both regions. One unit of labor produces one unit of output

independently of its quality level or location in each industry. Therefore, each industry has a

constant marginal cost which is equal to the wage rate in each region. The model follows the

quality-ladder framework and assuming Bertrand price competition.

Only Northern producers engage in innovative R&D activities. A Northern firm that

discovers a new product becomes a Northern quality leader and receives a perfectly enforceable

global patent of Einite duration T > 0. A Northern quality leader enj oys a flow of temporary

monopoly profits by selling the product to the world. The-state-of the-art product turns generic

as its patent expires and is then produced under perfect competition. The method of production









becomes general knowledge only in the North. Southern firms, having a cost advantage from a

lower-wage rate, target generic products in the North for imitation. A Southern firm that

successfully copies a Northern product becomes a Southern quality leader and enj oys global

monopoly profits until the next higher-quality product is discovered and a Northemn quality

leader replaces a copied product through limit pricing.

In the steady-state equilibrium, only Southern quality leaders target generic products and

only Northern quality leaders produce new products. Let w, and ws denote the wage in the

North and the South respectively and r > 1 represents trade costs, where 1 is the ad-valorem

tax equivalent of trade cost. If w, > wst, then imitation occurs only in the South. Also, if

w,r < Alws, then innovation takes place only in the North. As a result, we assume that at the

steady-state equilibrium the following condition is satisfied





A Northern quality leader, producing the state-of-the-art quality product j in industry B ,

charges p, = Alw, to drive out Northemn quality followers who produce the j-1 product. If a

product j -1 has been successfully copied by a Southemn firm, a Northern quality leader initially

charges pyr = Alws to drive a Southemn quality leader out of the market. Assuming the existence

of substantial re-entry costs in the South, a Northemn quality leader can use a trigger price

strategy to charge pyR = Alw, after a Southern quality leader exits the market. This process is

illustrated in Figure 2-1.

The profit flow of the Northern quality leader is derived by calculating the profit from the

sale in each region using prices and costs previously described. Define c = (c,L, + csLs )/L as

the per-capita global consumption expenditure. We use the per-capita global consumption









expenditure to derive the global demand for each type of product. The profit flow of a Northemn


quality leader can be written as i, = (iw, w)q,L, +i "I wN:, qss hee, and qs

are per-capita quantities demanded by Northern and Southern consumers respectively.

Substituting a demand function, previously solved in the consumer problem (Equation 2-5) by

using the per-capita global consumption expenditure then, a Northern quality leader's profit flow

can be written as

=[ a- 1 LN (t)1 ( a- r Ls (t) 4i) 29
a L(t) Arz L(t)

The profit is generated from a general price marked-up from its cost. An increase in trade

costs reduces Northern firms' profits. Trade costs impose an additional constraint on the size of

each innovation. The next innovation needs to have a quality increment parameter greater than

trade costs in order for a Northern quality leader to be profitable in the South.

Ai > r. (2-10)

A Southern quality leader charges the limit price ps? = we to drive its Northern

competitors out of the market and charges ps = wur in the domestic market. Notice that a

Southern quality leader also sells a product at a higher price in home market in the presence of

trade costs. Figure 2-2 illustrates the pricing structure in the presence of trade costs. The profit


flow fr a Sh o ut e uaity l eadembr c n b e writ na ss L +( r -ws s s


Define re, = "- > 1 as a North-South wage gap. Substituting per-capita quantity demanded from


consumer maximization problem (Equation 2-5) using the per-capita global consumption

expenditure then, a Southern quality leader's profit flow can be rewritten as









Frs -- =, (+ cL(t) (2-11)
my L(t) myLt~

For a given level of the relative wage 0i an increase in trade costs may increase or

decrease a Southern quality leader' s profit, depending on the size of the population in both

regions. If Ls > miL,, then the profit of a southern quality leader increases in trade costs and vice

versa. The following condition guarantees positive profits associated with exports for a Southern

quality leader

0 ,> r. (2-12)

Innovative Research and Development

This model adopted basic assumptions on innovation and imitation technology from

Dinopoulos et al. (2005) where the main focus is on the balanced-growth equilibrium properties

of the model. This is done for both tractability and comparability. Define a as an innovative

R&D productivity parameter and let ev"' capture the R&D difficulty at long-run equilibrium

at a dt
where p > 0 is a parameter. A Northern firm i produces with certainty dAl = 4,units of the


state-of-the-art quality products when it hires 2 units of workers for innovative R&D activities

during a time interval dt. Also define dA = C1 dA, as the aggregate flow of new products and


LA, = C1 as the aggregate labor in innovative R&D activities. Then the economy wide rate of

aL~dt dA(t)
patents can be written as dA = ao(t nd A(t) = is the steady-state instantaneous flow of
evr dt

new products per industry. The long-run innovation rate can be written as


A(t) = yo()(2-13)









Define x(t)= (v, (t) A~t) as the steady-state evolution of x(t), where 0 < v, (t) < is the

measure of industries with active patents. The parameter P e (-1,1) captures the correlation

between the patent length and Schumpeterian growth. P takes a negative value when patents

enhance the innovation process by reducing R&D difficulty. On the other hand, P takes a

positive value when patents reduce the flow of knowledge spillovers and increase R&D

difficulty. Lastly, P = 0 when there is structural symmetry across industries.

In the steady-state equilibrium, the measure of industries protected by patents v, (t) is

bounded and must be constant over time. The flow of patents A(t) is also constant over time in

order to have a bounded per-capita long-run growth rate. The steady-state value of R&D

difficulty is given by

x(t) = (v ) A (2-14)

8A(t)
Differentiating Equation 2-13 with respect to labor yields, = ae V""', the
8LA

productivity of R&D workers which decreases over time. This implies that the innovative R&D

labor requirement increases over time in the steady-state equilibrium. Rewrite the long-run


innovations rate (Equatlion 2-13) as Ait).Y = a L(t)e-"' '. The term in square brackets is the

share of innovative R&D workers and will be constant in the steady-state equilibrium. Since

A(t) is constant over time, the term L(t)ev""') = Le("v"(t) will also be constant over time.

Substituting the steady-state value of R&D difficulty x(t) from Equation 2-14, the steady-state

rate of new products can be written as


A (2-15)









The steady-state rate of new products is directly related to population growth n, and

inversely related to the R&D difficulty parameter


quality leaders raised to the power which provides the endogenous link between patent

coverage and the rate of innovation A When p = 0, the steady-state rate of innovation is

exogenous.

Northern firms target generic products for engaging in innovative R&D activities. Let

yA (8, t) denote the market value of a patent at time t in industry B that can be written as


V (B,t)= Ir,(t fs)e-'"("ds. (2-16)


Assuming structural symmetry across all industries, consequently the value of a patent is

identical across industries. Substitute the Northern firm's profit function from Equation 2-9,

using the result from the consumer optimization problem (Equation 2-7) and integrating

Equation 2-16 yields the steady-state market value of a typical patent


V (t) = l- (An) -[ 1,() +-\ L (2-17)
AA()= j p -n L(t) r L(t)


At the steady-state equilibrium, the value of a typical patent is increasing in the patent

length T, the quality increment Ai, and the population growth rate n. The value of a patent is

inversely related to trade costs r and the subj ective discount rate p .

A Northern firm i that hires I, units of workers for innovative R&D activities during a

af ,dt
time interval dt produces the-state-of-the-art product with a market value of I dAl = F


The cost of innovation is (1 r, )w ,8,dt where r 2 > 0 is an ad-volarem subsidy to R&D

innovation. The discounted net profits can be rewritten as [a~ce"i' -(1- r 2)wv ],dt .We









assumed free entry into innovative R&D activities; as a result, the zero profit condition must

prevail in the R&D innovation sector. The following equation provides the condition that the

marginal product of labor in innovative R&D equals the subsidy-adjusted wage rate of labor.

VA -(t) (_ A N. (2-18)

Substitute the steady-state value of patent VA fTOm Equation 2-17 and the steady-state

value of R&D difficulty x(t) from Equation 2-14, we have


Ae i p -n L(t) r L(t)


From L, (t)e-w't) = Lge'tn-w~t) = L,, the innovative R&D condition can be obtained as



Ai p-n L r L

The innovative R&D condition shows a positive linear relationship between per-capita

global consumption expenditure and the Northern wage rate. As per-capita global consumption

expenditure increases, the innovation price increases. In order to restore the zero profit condition

for net discounted profit, the wage of Northern workers need to be increased.

Imitative Research and Development

Assume that the process of imitation is endogenous and depends on the amount of workers

used. Also, assume that products become more difficult to copy as the population increases.

Southern firms target generic products for imitative R&D activity. A Southern firm j hires ,

units of workers for imitative R&D during time interval dt and succeeds in copying

pl ,dt
dM, = units of generic products, where pu is an imitative productivity parameter. Define
SL(t)









L,, (t) = C, c as the aggregate labor devoted to R&D imitation. The economy wide rate of

imitation can be written as

ULM (t)
M~(t) = ^ (2-21)
L(t)

dM~
where Mi =~ dt ad dM~ = CI dMl The aggregate rate of imitation depends on the share


of labor devoted to imitative R&D. Let (8, t) denote the expected discounted profit of a

successful imitator j of a product in industry B at time t. A Southern firm j hires 8, units of

ptQ~dt
workers for imitative R&D during time interval dt and succeeds in copying dM, = umits
SL(t)

,(8, t)pQ, dt
of generic products with a market value of y,;(8, t)dM~, =. At the same time
L(t)

interval, the cost of imitative R&D equals the subsidy-adjusted wage (1 z,)ws Idt where z,

is an ad-valorem subsidy to imitative R&D. Also, we assumed that there is free entry into

imitative R&D activities which leads to the zero profit condition in the imitative R&D sector.

The following imitative R&D condition can be obtained where a firm hires labor until the value

of the marginal product of labor devoted to imitative R&D equals the subsidy-adjusted wage in

the South


'"= (1- ,)'9s. (2-22)
L(t)

To find expected discounted profit & ,, we use no arbitrage condition and a stock market

valuation of a Southern monopoly profit. Denote v, as a measure (and set) of industries with

Northern quality followers, vs as a measure of industries with a Southern quality leader and vP

as a measure of industries with a Northern quality leader. We assume that v,, + v,, + vs = 1 .









During the time interval dt, a Southern firm which does not have patent protection faces a risk of


default from a creative-destruction process with instantaneous probability A~~t. The generic
vs + v,

product can be replaced by the discovery of a higher-quality product in the North. Then, a

Southern quality leader suffers a loss equal to (0O V,). If there is no discovery of the next

higher-quality product, a Southern firm receives a capital gain equal to dV, = V,dt Therefore,

the no arbitrage condition is

s~~~ dty + dt 1- t dt= r(t)dt. (2-23)
Vi, V, + MX vs + v, V) vs+v


The first term in the left-hand side represents a dividend from investing in the stock of an

imitative R&D firm. The second term denotes the capital gain when there is no discovery and the

last term denotes the capital loss if there is a discovery of a new higher-quality product. The

right-hand side is a riskless rate of return. Taking limits as dt approaches zero and solving for the

market value of a Southern quality leader yields


V, s (2-24)

vs + V, Y

Substitute a Southern profit (Equation 2-11) into Equation 2-24. In the steady-state


equilibrium, r(t) = p and "- = n; therefore, the Southern market value can be written as



m L ( t ) r 1 L ( t
+ cLtt
V, (t) = (2-25)
p+ -n
vs + V,









Substituting Equation 2-25 into the zero profit condition (Equation 2-22) yields the

imitative R&D condition


+ + 'y n], (2-26)
my wr L puc


where ry = A is the risk of default for a Southern quality leader.


Labor Markets

We assumed prefect labor mobility and full employment to prevail within each region. The

demand for labor in the North comes from three activities which include innovative R&D,

manufacturing of new products and manufacturing of generic products. First, one could derive

the demand for innovative-R&D labor by substituting the steady-state value of R&D difficulty

(Equation 2-14) into the long-run innovation rate (Equation 2-13). These substitutions yield the

Ae t~,g
following expression for innovative-R&D labor L (t) =


cN (t) cs (t)
Second, each Northern quality leader produces L, (t) + Ls (t) units of
p, (8, t) pR (8, t) r

new products. Substitute the price p, = Avw, and p',r = il9, yields the quantity produced as

c(t)
L(t) There are vP industries producing new products; therefore, the demand for labor in


c(t)
manufacturing new products equals vp L(t). Using the same methodology and noticing that


there are v, industries producing generic products in the North, the demand for labor in

c(t)L(t) L, (t) Ls (t)
manufacturing of generic products can be written as v, +N .~t zL The Northern









full-employment condition can be derived from setting the aggregate demand equal to the

aggregate supply

Ae''~": V,c(t)L(t) vNc(t)L(t) L, (t) Ls (t) (-7
a, Aw, w L(t) rL(t)


Substitute the steady-state rate of new product A = and divide Equation 2-27 by L(t).


results in the per-capita Northern full-employment condition which can be written as

L, nZ VC Vc v, LN Ls
+ (2-28)
L, amgGp' Aw, wy L r

Next, we considered the Southern labor market. The aggregate demand for labor comes

from two activities which are imitative R&D and manufacturing of generic products. Using


Equation 2-21, the demand for imitative R&D labor can be written as L,, (t) = Mt). Each


c(t)L(t)( L, (t) Ls (t)zLt i mnr m~l ll r
Southern quality leader produces + unt fgeei rout.Thr r


s, industries copying generic products in the South at each instant of time. The Southern full-

employment condition can be derived by setting the aggregate demand for labor equal to the

aggregate labor supply

M~L(t) c(t)L(t)( L, (t) Ls (t)
Ls (t) = + vs + .~) (2-29)
pu wy Lt L(t)

Dividing Equation 2-29 by L(t), the per-capita Southern full-employment condition is

Ls Mi vsc L, Lsz 2-0
L p w L r









Steady-State Equilibrium

We focused on the balanced growth equilibrium in which each variable grows at a constant

rate over time. Variables that are constant in the steady-state equilibrium are the market interest

rate r, per-capita global consumption expenditure c, all product prices, wage rates w, and ws,

the rate of innovation A the rate of imitation Mi, the measure of industries with a Northern

quality leader vP, the measure of industries with Northern firms producing generic products vy,

and the measure of industries with a Southern quality leader vs Variables that grow at the

constant rate of population growth rate include quantities produced, labor allocated to various

activities, the flow of Southern and Northern profits and the market value of quality leaders.

To solve for the steady-state equilibrium solution, let the wage of Southern labor be a

numeraire ws = 1 so that co, = w, > 1 captures the North-South wage gap. In the steady-state

equilibrium, the measure of industries with a Northern quality leader is related to the strictly

positive patent length as


v, = Akds= AT. (2-31)


Since patent protection is finite and the rate of patents is constant overtime, the measure of

industries with active patents protection is equal to the rate of innovation times the patent length

T > 0 Substituting the steady-state rate of new product (Equation 2-15), the steady-state

solution for the measure of industries with a Northern quality leader can be obtained as



v = (2-32)


We imposed the condition 9 > Tn to ensure that the measure of industries with patent

protection is less than unity. The fraction of industries with a Northern quality leader increases in










the rate of population growth and the patent length. Substituting Equation 2-32 to Equation 2-15,

we rewrite the steady-state solution for the rate of global innovation which equals the flow of

patents as


n fl+P)
A = T (2-33)


The long-run rate of global innovation is increasing in the rate of population growth and

decreasing in the R&D difficulty parameter An increase in the parameter p raises the level

of R&D difficulty and reduces the rate of innovation. The relationship between the long-run rate

of global innovation and the patent period depends on the parameter /7 .

Denote variables with a hat (^`) as the long-run equilibrium value of endogenous variables.

The explicit steady-state solution for all variables can be solved using the innovative R&D

condition (Equation 2-20) and the imitative R&D condition (Equation 2-26). The steady-state

value of global per-capita consumption expenditure can be written as


c^= A(-)1 )L +L (-)pynr L .(2-34)
"G(1-e /A -1)L + --1 rLs L +iLs


The steady-state value of the North-South wage gap can be written as


co = ( (1 n) en +1z+( z 1Lz+ (2-3 5)
(1- Z ) Ap~(p n) L + Lst L + Ls'


where ry = is the risk of default for a Southern quality leader. Substitute the steady-
1- v


state solution for the measure of industries with a Northern quality leader (Equation 2-32) and

the rate of global innovation or the flow of patents (Equation 2-33) ry can be written as











ryr= -1 .iT (2-36)


The long-run North-South wage gap is increasing in factors that enhance the process of

innovation including the productivity of innovative R&D labor a the subsidy to innovative

R&D z and the magnitude of innovations Ai On the other hand, the long-run North-South

wage gap is decreasing in parameters that encourage the transfer of technology from the North to

the South which includes the productivity of imitative R&D labor pu, and the subsidy to

imitative R&D rat. The detail calculation is provided in the Algebraic detail section. In addition,

we used computer simulation analysis to check for the wage equilibrium condition (Equation 2-

8) that we imposed earlier and found that there is a range of different value of parameters that

satisfied the upper and lower limit from Equation 2-8. For instance, if the subsidy to imitation or

innovation is equal or close to unity, the size of innovation Ai need to be greater

L r2 +Lsz
than Ai > However, this is just a sufficient condition but not a necessary condition
L + Lst

for the steady-state wage condition (Equation 2-8) to hold.

To solve for the steady-state value of the rate of imitation, adding the per-capita Northern

full-employment condition (Equation 2-28) and the per-capita Southern full-employment

conditions (Equation 2-30) then, substitute the steady-state solution for the measure of Northern

quality leaders (Equation 2-32)



n M c T Dr 1# iL L,
1 = + +- + 1--+-s (2-3 7)









Using the innovative R&D condition (Equation 2-20), the steady-state rate of imitation can

be written as


n IpL s Tn 1 ,r+L
1- T f a- x-~ \ [Lz+LIiLz+L
dM
=~ l p<"T ~ i L (2-38)



The steady-state value of the measure of industries with the Southern quality leaders can

also be solved using the Southern full-employment condition and the steady-state rate of

imitation.

Schumpeterian Growth

To derive the long-run Schumpeterian growth, we considered the long-run growth rate of

each consumer' s utility function. Let A(t) denote the economy-wide number of innovations at

time t, as well as the average number of innovations per industry since the measure of industries

is normalized to unity and all industries are structurally identical. At each instant in time, there

are v, industries with a Northern quality leader. The average number of innovations in each of

these industries is j(B, t) = A(t). Northern quality leader charge p, = Am~i in the North and

charge pyR = Am i. The remaining industries v, + vs are characterized by an average number of

innovations j(B, t) = A(t) Every Southern quality leader and every competitive firm in the North

producing a generic product charges a price equal to the Northern wage in the North psz = 0i

and charges a price equal to the wage times trade costs in the South. ps = wr~ Thus, the

instantaneous utility of a typical household member in the North at time t is










Inu~t)= In A +t) N A1t)N dO. (2-39)


Integrating Equation 2-39 yields the level of the instantaneous utility at time t for a typical

Northern consumer


Inu(t)= A(t)1niiv In[ c s1c" (2-40)

The instantaneous utility of a typical household member in the South at time t is


In~ut) In; AA]t) S A[t) S dO. (2-41)

Integrating Equation 2-41 yields the level of instantaneous utility at time t for a Southern

consumer


Inu(t)= A(t)1ni+v In c ') c (2-42)

In the steady-state equilibrium, all variables on the right-hand side of the Equations 2-40

and Equation 2-42 are constant over time, except for the number of innovations A(t) = At .

Differentiating the level of instantaneous utility with respect to time and using the steady-state

flow of patents (Equation 2-33) yields

ui n 0'+P)
g, A n =T IP'n 2 (2-43)
g~ u =,, pi

The model has a steady-state equilibrium that generates a process of Schumpeterian

creative destruction which results in product-cycle trade, long-run scale-invariant Schumpeterian

growth and a North-South wage gap. Growth is proportional to the rate of innovation A which

is equal to the steady-state flow of patents. More importantly, the rate of innovation depends on

patent protection which is governed by the parameter /7 E (-1,1) that captures the structure of









knowledge spillovers. In the case of symmetric knowledge spillovers (P = 0), long-run growth

is exogenous. If patents decrease knowledge spillovers P e (0,1), then an increase in patent

protection decreases long-run Schumpeterian growth. In contrast, if patents enhance knowledge

spillovers, an increase in patent protection increases long-run Schumpeterian growth. With the

imposition of trade cost, we still obtain the same properties of long-run Schumpeterian growth as

in the absence of trade cost. The long-run Schumpeterian growth is increasing in the rate of

population growth and the size of innovation but decreasing in the parameter of R&D difficulty

as in Dinopoulos et al. (2005).

Comparative Steady-State Analysis

We have solved the steady-state value for each variable of interest. In this section, we

studied the long-run effects of globalization and intellectual property rights. As in Dinopoulos et

al. (2005), globalization is viewed as a geographic once-for-all increase in the size of the South

measured by the level of the Southern population. The entering to World Trade Organization by

China at the end of 2001 is an important example of globalization in this aspect. This

globalization trend is also supported by a study from Wacziarg and Welch (2003). They found

that countries with an open trade policy have increased significantly from 15.6 % to 73 % of all

countries in the world during 1960 to 2000.

Additionally, we examined a second dimension of the globalization process by studying

the effect of a reduction in trade costs. The invention of containerization technology in the

shipping industry has standardized and sharply decreased transportation costs all over the world.

Moreover, email and internet communication reduces the cost of communication in most

business transactions. As globalization becomes prevalent, trade costs which include

transportation costs, tariffs, language barriers costs, marketing cost etc. have decreased









substantially. The following proposition summarizes the effects of various dimensions of

globalization in which this model provided:

Proposition 2-1. Globalization, viewed as a permanent decrease in trade cost (r 1)

(i) worsens the long-run wage-income distribution between the North and the South by raising
the relative wage of Northemn workers (m, ~) if and only if the population size of the South
is greater or equal to that of the North (Ls > L, )

(ii) has an ambiguous effect on the relative wage of Northern workers (0i ?) if the North
population is greater than those in the South (Ls < L, )

(iii) has an ambiguous effect on the rate of technology transfer from the North to the South
(M~ ?)

(iv) does not affect the long-run rates of innovation A(++) and Schumpeterian growth (g, ++)

Proof. See Algebraic Details

A long-run decrease in trade costs has different effects depending on the size of the

population in each region. Proposition 2-1 (i) tends to resemble the real world situation where

most of developing nations, such as China and India, have more population than developed

countries. The size of the population can capture not only the number of people but also the size

of the market in each region. The economic intuition behind this proposition is that as trade costs

decrease, Northern quality leaders receive more profit from selling the-state-of-the-art products

to the South and demand more labor which leads to an increase in the wage rate in the North. On

the other hand, Southern quality leaders receive more profit from selling generic products to the

North but become less profitable in the South due to a decrease in the price of generic products.

Given that there is more population in the South, the profit of Southemn quality leaders would

decrease. Therefore, a decrease in trade costs would lead to an increase in North-South wage

gap. However, when there is more population in the North, Northemn quality leaders and

Southern quality leaders both become more profitable; therefore, the effect on the North-South









wage gap is ambiguous. In addition, the effect of trade costs to the rate of imitation is also

ambiguous since a decrease in trade cost could result in either an increase or a decrease in the

profit of a Southern quality leader. In the latter case, Southern quality leaders have less incentive

to do more imitative R&D activities.

Proposition 2-2. Globalization, viewed as a permanent expansion in the size of the South




(i) has an ambiguous effect on the long run wage-income distribution between North and
South (co, ?)

(ii) has an ambiguous effect on the rate of technology transfer from North to South (M~?)

(iii) does not affect the long-run rates of innovation A(++) and Schumpeterian growth (g, ++)

Proof. See Equation 2-43 and Algebraic Details

As population in the South increases, demand for both generic and the-state-of-the-art

products increase. The effects on the demand for labor and the wage rate in each region depend

on all parameters in the model especially, the value of trade costs, the parameter of innovation

and the size of population in both regions. Therefore, an increase in the size of developing

countries has an ambiguous effect on the North-South wage gap and the rate of imitation. An

expansion in the size of the South does not necessarily worsen the world income distribution or

enhance the rate of imitation as has been found in previous studies.

Proposition 2-3. A permanent increase in the global patent protection generated by an

increase in the patent length (T 1)

(i) permanently raises the rate of technology transfer from North to South (Mi T) if the
following sufficient condition holds: Ly + Ls 1~









(ii) permanently increases the wage-income inequality between North and South (mi ?) if the
S 1+ 1 1 1+
follow~ing sufficient condition holds: > -1!)"

Proof. See Algebraic Details

The effect of an increase in patent length and the R&D subsidy remains robust to the

introduction of trade costs. The economic intuition of the Proposition 2-3 is that longer patent

protection shifts resource away from the innovative R&D sector and manufacturing to the

imitative R&D sector. This resource allocation results in a permanent increase in the rate of

global imitation M Moreover, longer patent protection increases the duration that Northern

quality leader enj oys the global monopoly profit and increases the risk of default for the

Southern quality leader which leads to an increase in wage-income inequality between North and

South.

Proposition 2-4. The effect of a change in the subsidy to innovative R&D and imitative

R&D can be summarized as follow

(i) A permanent increase in the innovative R&D subsidy (zA ~) WOrsens wage-income
inequality (m, ~) and raises the rate of imitation (hi ) .

(ii) A permanent increase in the imitative R&D subsidy (r, 1) decreases the North-South
wage gap (0i 1) and does not affect the rate of imitation (hi ++).

Proof. See Equation 2-35 and Equation 2-38

The long-run North-South wage gap is increasing in factors that enhance the process of

innovation and decreasing in parameters that encourage the transfer of technology from North to

South. The subsidy to imitative R&D activities does not affect the long-run values of the set of

industries which are protected by patent, vp and the risk of default of a Southern quality leader,

ry. Therefore, it has no effect on the long-run rate of imitation in this model.









Conclusion

In this chapter, we develop a North-South model with global patent protection, endogenous

growth and product-cycle trade in the presence of trade costs. The model was used to analyze the

effects of globalization measured by a reduction in trade costs (caused by trade liberalization or

technological advances in transportation and communication) and a geographic expansion of

developing countries. A reduction in trade costs worsens the wage-income distribution between

regions. Trade liberalization has an ambiguous effect on the steady state rate of imitation and has

no effect on either innovation or the growth rate. The effect of an increase in the Southern

population is inconclusive in the presence of trade costs.

Algebraic Details

We calculated the steady-state value of North-South wage gap by using innovative R&D

condition (Equation 2-20) and solving for per-capita global consumption expenditure


c = (2-44)
a~l -e P")., (i -zL 1)


Then we used imitative R&D condition (Equation 2-26) to solve for per-capita global

consumption expenditure


c = (2-45)



We equated the per-capita global consumption expenditure c from Equation 2-44 and 2-45

and solved for the steady-state value ofNorth-South wage gap


ci)= aLZ(1-r)(kp + V-n)1- e F"')3 )I(- 1)r+ (Al- )L~s Ly + Ls (2-46)
Ap(1O- zA (p n) L, + Lst L, + Ls'









Next, we performed comparative static for each variable in the model. First we

differentiated the steady-state value of North-South wage gap &i (Equation 2-46) with respect to

the productivity of labor in innovative R&D activity a

a; ~ (1 e (n ( -)z / L > 0. (2-47)
aa (1- z,) Ap~(p -n) L, +Ls'

Then, we differentiated the steady-state value of North-South wage gap & (Equation 2-46)

with respect to the subsidy to innovative R&D activities z,


a; O- L~ y )(1 e (p) / )~ / )~1> 0. (2-48)
az, (1- z,)2 Ap(p -n) L, +Ls'

Lastly, we differentiated the steady-state value of North-South wage gap & (Equation 2-

46) with respect to the magnitude of innovations Ai

c3j_(- ~ YZ( I- )( e"))> 0. (2-49)
Sa/ (1- ")A (p-n) +Ls'

We can see that the steady-state value of North-South wage gap &i is increasing in the

productivity of labor in innovative R&D activity a the subsidy to innovative R&D activities z,

and the magnitude of innovations Ai On the other hand, the steady-state value of North-South

wage gap & is decreasing in the productivity of labor in imitative R&D activities p, and the

subsidy to imitative R&D activities g, To show this we differentiate the steady-state value of

North-South wage gap & ,(Equation 2-46) with respect to the productivity of labor in imitative

R&D activities pu


a; ~(1 -ep) e < 0. (2-50)
dSp (1- z,) p A/(p n) L, + Ls'









Then, we differentiated the steady-state value of North-South wage gap & (Equation 2-46)

with respect to the subsidy to imitative R&D activities z,


(IeP' )ol(y n < 0. (2-51)
raz, 1 -7 Ap) 2(p -n) L, +Ls'

Next, we showed the calculation of the steady-state value of global per-capita consumption

expenditure E .We solved for the North-South wage gap 0i from innovative R&D condition

(Equation 2-20)


ac(; 1 I I (
0 = (2-52)


Using imitative R&D condition (Equation 2-26), to solve for the North-South wage gap 0i


L~+~t~ (-z, L~ r/- zz~C+ L + rLs (2-53)

We equated the North-South wage gap a ~from Equation 2-52 and 2-53 and solve for the

steady-state value of per-capita global consumption expenditure

c Z A~ (pn(- ) LxfLs (1 -z, )(p + y- n)z L .(-4



Proof of Proposition 2-1 (i) and (ii). By differentiate Equation 2-35 with respect to trade

costs, we have the following equation


c32r2 + Ls')


where k= 1q afp -n1- '>0










The sign of depends on the size of labor in both regions. If the initial population in the


South is greater than or equal to that in the North Ls > L,,, then -is negative. However, if the


initial population in the South is less than that in the North Ls < L ,, then can be both


negative or positive.

Proof of Proposition 2-1 (iii). By differentiate Equation 2-3 8 with respect to trade costs

dhM
r we can see that has an ambiguous sign



8 r a(1- e (")




i~( -1) :" +IL 1 Ls



1- -+-I -

(A -1)L s L, + 1, Ls~ 1"


Proof of Proposition 2-1 (iv). By differentiate Equation 2-33 and Equation 2-43 with

dA ag,
respect to trade costs r O and = 0, We see that both variables are not affected by

trade costs r .

(1-7, )a(p+y -n)1- e("j
Proof of Proposition 2-2 (i). Define z = > 0, the long-
(1-7 ) A(p -n)

run Northern relative wage rZ can be written as









&L = z(LN + Ls, sn s1Lz +(1 )~ Lz+L
L, + Lst L, + Ls*

Differentiate the long-run Northern relative wage a), with respect to the Southern

population

84, (/Z- 2 + /7z- /7 +7 Z)L ,+ (AZ-)2L,Ls (/ z)z u(1-2 )
8LsL~ +LsZ (L, + LsT)2

To determine the sign of _, the denominators of both terms are positive while, the
dLS

numerator in the square bracket has ambiguous sign.

(AZ + ATz + 22 27 Ar 2)L, + (AZ z)2L,Ls + (AZ z)rzs

? + +

The numerator of the second term is negative L,(1 22 ) <0. Given that : is positive, the


sign of is ambiguous


Proof of Proposition 2-2 (ii). We can see that the sign of _can not be determined by
dLS

differentiate Equation 2-3 8 with respect to the Southern population Ls


a(1- e'"T i")


csnM ~~n 1+ ,,


n ;1+


A A Lz rI + + n1
1~ ~ ~ : (Y A )L,+1L -s1-





(pe "2(
- e )2( -


Proof of Proposition 2-3 (i). Differentiating Equations 2-38 with respect to patent length


d2M 1
T, we can see that is positive if LV r+L ."
dT Lz r

1 1+2P -
-h -Y 'P T La +
dT 1+ P


A Lyr+Ls


a(1


1
2


"! Ly + Ls z


n (- )


Proof of Proposition 2-3 (iii). For simplicity of the calculation define

Kt =/ s)~ / zLL ~ and differntiate Equation 2-35 with respect to


patent length


1


K<


n)(p + 1 + -
T Tn

-1 +~ 1 +#-

1-~T Tnc"


ep'! "l e p l(p


-(p-n)T


is positive if


a(1- e P"') (A-)L +L


S 1 n
puT ''


Ly + Ls Tn I
- Lr p


S+ 1 1
n) \1+P T


n \1+ P T Tn











charges


charges p
Pv = Aw" to drive out
to drive out

North
Follower



Figure 2-1. Pricing structure of the Northern quality leaders




charges
North Followers

producet~o drives out


Figure 2-2. Pricing structure of the Southern quality leaders









CHAPTER 3
PATENT ENFORCEMENT POLICIES AND ENDOGENOUS GROWTH

Introduction

The protection of intellectual property rights (IPRs) is one of the most debating issues in

the international economic scene. Various arguments in favor and against stronger IPRs have

emerged as many believe that General Agreement on Trade-Related Aspects of Intellectual

Property Right (TRIPs) is a rent-transfer mechanism from developing countries to the more

powerful developed nations. As each country differs in its economic fundamentals, the

implementation of TRIPs poses an imbalance in social and economic development among rich

and poor countries. In addition, stronger enforcement could restrict diffusion of knowledge and

competition and resulted in a higher product price. On the other hand, strengthening enforcement

of IPRs, not only improves the business and investment climate, but also boosts incentives for

domestic innovation and technology transfer to developing countries. Moreover, the enforcement

of IPRs serves as a remedy to a market failure for the growing knowledge-based market and

reduces transaction cost that might arise from information asymmetries. Consumers have more

choices in product variety and quality. The diffusion of information and technology would lead

to an improvement in labor productivity and enhance economic growth.

Balancing these dynamic gains and costs that arise from strengthening IPRs is a

challenging task for policy makers. The signing of TRIPs required member nations of World

Trade Organization (WTO) to conform to a set of minimum standards in protecting and

enforcing IPRs in their countries. Each government needs to implement various policies i.e.

enforcement effectiveness, scope of protection, length of patent, trademark and copy right, etc.,

while allocates scare resources toward the patent enforcement sector i.e. training of enforcement

officer, lawyers, judges and setting up monitoring system, legal framework, etc. Extensive works









have been conducted to answer questions like who will gain and who will lose from the

strengthening IPRs protection? Is the harmonization of the standard and enforcement of IPRs a

necessary or sufficient condition for increasing global welfare and economic growth? Does IPRs

protection encourage innovation and R&D investment? What determine the incentive for patent

protection? In the second chapter, we developed a simple dynamic closed-economy model to

examine the effect of various factors on the resources used in patent enforcement activities which

is represented by the probability of patent enforcement.

Various studies have examined the effects of patent protection on the income distribution,

innovation, imitation and economic growth. Helpman (1993) developed a general-equilibrium

model of an innovative North and an imitative South. He concluded that an increase in IPRs

protection harms the South because of the change in the term of trade and a reallocation of

resource toward Northern products while the North might not necessary gain many benefits due

to an increase in product price. Glass and Saggi (2002), built a product-cycle model of

endogenous innovation, imitation and foreign direct investment (FDI), and found similar

negative results, namely that stronger IPRs in the South reduces innovation, imitation, and FDI.

Park (2002), using OEDC data on 21 countries, showed that patent protection and enforcement

stimulates private R&D. Also, Dinopoulos and Kottaridi (2006) used a North-South model with

exogenous patent enforcement and found that a move towards harmonization by the South

accelerates the long-run rates of innovation and growth, improves the global wage-income

distribution, but has an ambiguous effect on the rate of international technology transfer. In the

presence of harmonized patent policies, stricter global patent enforcement increases long-run

global growth, accelerates the rate of international technology transfer and has no impact on the

global income distribution.









The relationship between IPRs protection and economic development is indeed

complicated. Ginarte and Park (1997) constructed the index of patent rights and found that more

developed countries tend to provide stronger protection of intellectual property. He concluded

that the level of Research and Development (R&D) activities, market environment and

international integration are significant factors in determining the protection level. Grossman and

Lai (2004), using a North-South framework and exogenous patent enforcement, concluded that a

country with a larger market for innovative R&D, higher human capital endowments and greater

capacity to conduct R&D offers stronger IPRs protection while patent protection is weaker if a

country is close to international trade. This paper added to the literature on intellectual property

protection by introducing a resource-using endogenously determined patent- enforcement

mechanism and therefore provides a novel link between patent length and the degree of patent

enforcement.

Closed-Economy Model

In this chapter, we developed a closed-economy model with an exogenous rate of

population growth. The model is based on the quality-ladder framework where the quality

leaders invent new products and receive a finite-length patent with some probability of patent

enforcement. This paper contributed to the existing literature on growth and intellectual property

protection by introducing resource-using and thus endogenous patent enforcement and by

studying the relationship between patent enforcement and the long run rates of innovation and

economic growth.

Household Sector

The demand side of the economy is generated by dynastic households with infinitely lived

members. Each household member is endowed with one unit of labor which is supplied

inelastically to the market. The size of each household grows exponentially at the rate of n > 0,









where new household members are born continually. We normalized the initial size of each

household to unity for simplification; therefore, the number of household members at time t is

e"t. Let L(t) = Le"' denote the level of population and the supply of labor at time t, where L is

the initial level of population.

There is a continuum of industries indexed by B E [0,1]. Each industry produces a final

consumption good of different quality levels which are indexed by j, where j represents the

number of innovations in each industry. Let Al'8.t denote the quality increment generated by

each innovation in industry 8, where Ai > 1 captures the size of each innovation.

Each household maximizes the following discounted lifetime utility


U e P" "" nu(t)dt, (3-1)


where p > n is the constant subjective discount rate.

The instantaneous per-capita utility function at time t is defined by


In o) In4*qj0,)6 (3-2)

where q(j,0, t) denotes the quantity demanded per person of a product in industry B with

quality level A'" at time t. Equation 3-2 also implies that, all else equal, consumers prefer higher

quality products to lower quality ones. Consumers choose their consumption to maximize their

discounted lifetime utility. The consumer maximization problem can be decomposed into the

following steps: first, consumers choose to consume the product with the lowest quality-adjusted

p, (8,t)~
pnice in each industry. Then, consumers allocate their budgets across all industries by


solving the across-industry static optimization problem. The result is the following unit elastic









c(t)
demand function q(B, t) = ,where c(t)is each consumer's consumption expenditure
p (B, t)~

function at time t. Lastly, consumers solve the dynamic optimization problem as to maximize

their discounted life time utility subj ect to their intertemporal budget constraint;



maO e I c, ) +In -I p0 t (3-3)

subj ect to z(t) = w(t) + r(t):(t) c(t) nz(t) where z(t) is the level of consumer assets at

time t, w(t) is the wage rate at time t, and r(t) is the market interest rate at time t. Solving the

dynamic optimization problem yield the following differential equation

c(t)
= r(t) p (3 -4)
c(t)

The market interest rate equals the constant subj ective discount rate since per-capita

consumption expenditure is constant at the steady-state equilibrium.

Domestic Production and Patent Enforcement Sector

Labor is the only factor of production and is perfectly mobile within a country. We

assumed that the labor market is perfectly competitive and one unit of labor produces one unit of

output independently of its quality level. Therefore, each industry has a constant marginal cost

equals to the wage rate. The model followed the quality-ladder growth framework by assuming

Bertrand price competition.

A firm that discovers the-state-of-the-art product becomes a quality leader and receives a

finite patent length T > 0, with the probability of patent enforcement represent by OZE (0,1) .

oL,
Define 0Z = E, Where LE is the amount of labor employed in patent enforcement activities


and a > 0 is a parameter that captures and productivity of enforcement activities. Variable L,










represents resources used in patent enforcement activities such as training of the enforcement

officers, lawyers, judges and examiners etc., disciplining infringement, establishing legal

framework and related court procedures, seizure and destruction of counterfeit goods, setting up

responsible agency, office and institutions. We can also interpret 0Z as an effectiveness of patent


enforcement. In addition, we imposed that cr <-~ to guarantee that the probability of patent
LE

enforcement is not greater than one.

After a patent expires, products become generic and sell competitively. A quality leader

charges p, = Alw to drive out producers of generic products through limit pricing. However, if a

patent is not enforced, with a probability of 1 02, the method of production becomes general

knowledge and quality followers imitate a product and sell competitively at p, = w There is no

imitative R&D in this model since the quality followers can produce a product whenever the

production method becomes general knowledge. Quality followers receive zero economic profit.

The profit flow of the quality leader can be described by the following equation

Al-1
yir(t) = sz(t)( )cL(t) (3-5)


The profit flow is increasing in the probability or effectiveness of patent enforcement and

the quality incremental which is generated by each innovation.

Innovation Process

The basic assumption of the innovation technology is adopted from Dinopoulos et al.

(2005). Let ev"mt capture the R&D difficulty at the long run equilibrium where a is a parameter

for innovative R&D productivity and

0 is a parameter for R&D difficulty. A quality leader

hires 8, units of workers for innovative R&D activities during time interval dt and produces









at ~dt
dA, = 7,, units of new products. Define dA = C2 dAI as the aggregate flow of new products


and LA = C1C as the aggregate labor in the innovative R&D activities. We can write the

aL~dt
economy wide rate of patents as dA = e""() The long-run innovation rate can be written as


aLA(t dA(t)
A(t) = e" ,where A(t) = dt is the steady-state instantaneous flow of new products per

industry.

Define x-(t) = (v, (t) A~t) as the steady-state evolution ofx(t), where 0 < v, (t) <1 is the

measure of industries with active patents. The parameter P e (-1, 1) captures the correlation

between the patent length and Schumpeterian growth. In the steady-state equilibrium, the

measure of industries protected by patents v, (t) and the flow of patents A(t) are bounded and

must be constant over time in order to have a bounded per-capita long-run growth rate. The

steady-state value of R&D difficulty is given by x(t) = (vp)B A~ We can re-write the long-run


innovation,, rat asA~t =- a, (L(t)e-,(c). The term in square brackets is the share of

innovative R&D workers which is constant in the steady-state equilibrium.

L(t)e-w'") = Le(hV-w(t)) is also constant over time since A(t) is constant over time. Therefore, the

steady-state rate of new products can be written as

k=n
Apl =. (3-6)









The steady-state rate of new products is increasing in population growth rate n but

decreasing in the R&D difficulty parameter


the measure of industries with active patents v, depends on the value of parameter /7 .

Let V, (8, t) denote the market value of a patent at time t in industry B that can be written




V, (0, t) = 79 (t + s)e "'"ds.(37


The value of a patent is identical across industries as we assume str-uctural symmetry.

Substituting the profit function of a quality leader from Equation 3-5 and integrating Equation 3-

7 yields the steady-state market value of a patent

Vi-i (t =Ot) cnt (3-8)



At the steady-state equilibrium, the value of a typical patent is increasing in the patent

length T, the quality increment Ai, the population growth rate n and the probability of patent

enforcement DZ. The value of a patent is inversely related to the subj ective discount rate p For

l-e-(p-n)T
simplicity, define gr(T) = to capture the effect of patent length and the effective
p-n

discount rate on the value of the patent.

In order to derive an equilibrium condition, we first considered the innovative R&D sector.

af ,dt
The market value of any innovative R&D activities can be written as V dAI = V il The


cost of innovation is (1 z, )we,dt where z, > 0 is an ad-volarem subsidy to R&D innovation.

The discounted net profits in the R&D sector can be written as [V,ae-"' (1- r )w r,dt We









assumed free entry into innovative R&D activities which leads to a zero profit condition in this

sector. The following equation provides the condition that the marginal product of labor in

innovative R&D equals the subsidy-adjusted wage rate of labor.

ViaeVLt = (1- 2)w (3 -9)

To find the closed economy innovative R&D condition, we substitute the steady-state value

of a patent from Equation 3-8


DacL p(r() =(1- r )w (3-10)

The innovative R&D condition shows a negative relationship between per-capita

consumption expenditure and the probability of patent enforcement. The intuition behind this

condition could be that as the effectiveness of patent enforcement increases, counterfeit good is

substantially reduced while, the price of product increases. Consumer has to reduce their

consumption.

Domestic Labor Market

The demand for labor comes from four activities which include innovative R&D L ,

patent enforcement LE,, and manufacturing of the-state-of-the-art product and generic products.

The demand for innovative R&D labor can be derived from substituting the steady-state value of

R&D difficulty into the long-run innovative rate which yields the demand for innovative R&D

Aeil' ) c(t)
labor as L, (t) = Each quality leader produces L(t) units of new products. The


c(t)
demand for labor in manufacturing new product equals vp L(t) The demand for labor in


producing generic products is vc ,t L(t), where v, is a measure of industries producing









generics product. This assumptions implies that v, + v, = 1 Setting aggregate demand equal to

aggregate supply for labor, we derive the full- employment condition as

Ae "i~i") c(t) c(t)
L(t) = -+v, L(t) + (1 v, ) L(t) +LE(t) (3-11)


Substituting the steady-state rate of innovation A = an iiigevr emb


L(t) gives us the per-capita fudl-employment condition

n c(t) c(t) c(t) LE t
1= + + v, +~ (3-12)
ap~L (vp)B P A~ w w L(t)

Steady-State Equilibrium

In the steady-state equilibrium, the measure of industries with an active patent depends not

only on patent length but also the probability of patent enforcement.


v, = JAds = A T (3-13)


Substituting the steady-state rate of new products, the steady-state solution for the measure

of industries with active patents can be written as


Pv =iT 1 (3-14)


We imposed the parameter restriction nT < p to ensure that the measure of industries with

patents protection is less than unity. This restriction holds for large values of parameter p .

According to Equation 3-14, the measure of industries with a quality leader increases with the

population growth rate n, patent length T and the probability or strength of patent

enforcement 0Z It is inversely related to the R&D difficulty parameter p .

We now rewrite the steady-state solution for the rate of innovation or the flow of patent as











A = (RT)(l+p) (3-15)


The long-run innovation rate is increasing in the rate of population growth n but decreasing

in R&D difficulty parameter 9 patent length T, and enforcement probability 0Z This result

based on the assumption that /7 > 0, where patents reduce the flow of spillovers knowledge and

create more difficulty to innovative R&D activities.

To solve for the steady-state equilibrium solution, we normalized the wage rate equal to

unity. Substituting the steady-state solution of the measure of industries with patents from

Equation 3-14 and using the definition of the probability of patent enforcement, we can rewrite

the per-capita full-employment condition as


nZ )'+ (Tn)i p n TOZ ''P 1-i A
1= +c+-. (3-16)


Performing computer simulations by using value of parameters similarly to Dinopoulos

and Segerstrom (1999) and Sener (2006), we find that there is a negative relationship between

per-capita consumption and the probability of patent enforcement. This relationship is based on

the per-capita full-employment condition (Equation 3-16). We can plot the innovative- R&D

condition (Equation 3-10) and the per-capita full-employment condition (Equation 3-16) in order

to solve for both the per-capital consumption expenditure and the probability of patent

enforcement as in Figure 3-1. The equilibrium now depends on all parameters in the model

including those which are related to policy changes.

Long-Run Schumpeterian Growth

To derive the long-run Schumpeterian growth, we consider the long-run growth rate of

each consumer' s utility function. At each instant in time, there are v, industries with a quality









leader. The average number of innovations in each of these industries is j(B, t) = A(t),

where A(t) denotes the economy-wide number of innovations at time t. The quantity produced by

c(t) c(t)
each quality leader equals L(t) while each quality follower produces L(t). Thus, the


instantaneous utility of a typical household member at time t is


Ino u; l(t) =l]81 In 14, cd +I 1,, c dO (3-17)


Integrating Equation 3-17 yields the level of the instantaneous utility at time t for a typical

consumer

c c
Inu~)= ~)1 +v In ]i + I (") (3-18)

At the steady-state equilibrium, all variables on the right-hand side are constant over time,

except for the number of innovations A(t) = At Differentiating the level of the instantaneous

utility with respect to time and substituting the steady-state flow of patents yields


g, Az =ln2ij Z( A! (T)M ln (3-19)


The long-run Schumpeterian growth now depends on all parameters in the model. Growth

is proportional to the rate of innovation A More importantly, the rate of innovation depends on

both patent length and the probability of patent enforcement which are governed by the

parameter fE (--1, 1) Parameter p captures the structure of knowledge spillovers. For example;

if patents decrease knowledge spillovers, that is if fE (0,1); then an increase in patent length

decreases long-run Schumpeterian growth. In addition, long-run Schumpeterian growth is

increasing in the rate of population growth and the size of innovation but decreasing in the

parameter of R&D difficulty. These results are similar to Dinopoulos et al. (2005).










Comparative Steady-State Analysis

Using computer-simulation analysis, we performed various comparative static exercises to

examine the effects of several parameters. The following proposition summarizes the main

results

Proposition 3-1. An increase in patent length increases the probability of patent

enforcement.

This result provides an important link between the patent length and patent enforcement

which has not been done in the previous literature. Most of previous literatures modeled the

probability of patent enforcement as an exogenous parameter or as a set of a policy choice from a

government. Using the definition of patent enforcement, we can see that an increase in patent

length will lead to an increase in per-capita resources devoted to patent enforcement activities.

An increase in patent length shifts up the full-employment curve while shifts down the

innovative R&D curve in Figure 3-1 and increases the probability of enforcement.

Proposition 3-2. An economy experiencing larger innovations, measured by parameter Ai,

or offering higher innovative-R&D subsidies T,, engages in stricter patent enforcement.

An increase in both the quality incremental parameter A and the subsidy to R&D sector T,

shift up the full-employment curve and shift down the innovative R&D curve in Figure 3-1. This

leads to an increase in the probability of patent enforcement. This result also conforms to the

patent rights index constructed by Ginart and Park (1997, 2002). Means of indexes of patent

right are higher among developed countries than those of developing countries. This result is

consistent with the results obtained by Grossman and Lai (2004).

Proposition 3-3. A country with the larger market size or population has a stricter patent

enforcement policy.










Using Figure 3-1, an increase in population shifts up the full-employment condition and

shifts down the innovative R&D curve which leads to a higher value of the probability of patent

enforcement. This result is also consistent with Grossman and Lai (2004) who found that a

higher relative endowment of human capital leads to an increase in the relative incentive to

protect IPRs; moreover, a larger market for innovative product enhances a government' s

incentive to grant stronger patent rights. The intuition behind this proposition is that as a country

becomes larger, a government might be able to allocate more resources toward patent

enforcement sector.

Proposition 3-4. An increase in the innovative R&D difficulty parameter


decrease in patent enforcement.

An increase in the innovative R&D difficulty shifts down the full-employment condition

curve, while the innovative R&D condition remains unchanged. This results in a decrease in the

strength or the probability of patent enforcement. The intuition is that as products become harder

to discover and produce, resources are devoted more to innovative R&D sector. A reduction in

the resources used in the enforcement sector directly affects the effectiveness of patent

enforcement.

Proposition 3-5. An increase in the strength of patent enforcement

(i) accelerates economic growth if patent increases knowledge diffusion in the economy
PE (- 1, 0)

(ii) decelerates economic growth if patent decrease knowledge diffusion in the economy
PE (0,1)

The effect of an increase in patent protection to economic growth depends entirely on the

characteristic of patent process. As some views that stronger IPRs might restrict the access to

new information and technology while others argues that the knowledge from patent application










encourages further innovation of new products and an increase in average quality of product in

the market.

Conclusion

In this chapter, we developed a simple closed-economy model using the quality ladder

framework. The model generated endogenous Schumpeterian growth and also provides an

endogenous link between the patent length and the probability of patent enforcement. The novel

result is that as the patent length increases, the probability of patent enforcement also increases.

Our finding is consistent with the previous literature in that a country with more advanced

technology or with a larger market tends to have higher probability of patent enforcement. On

the other hand, we found that the higher the difficulty in innovative R&D activity, the less the

probability or strength of patent enforcement will be. Various dimensions in this model can be

developed to answer additional question related to IPRs. It might be interesting to differentiate

wage and skill level of labor in different sectors and also to explore more on the government

budget constraint to finance the expense in the patent enforcement sector





Full-employment condition


Innovative R&D condition


Figure 3-1. Closed-economy's steady-state equilibrium









CHAPTER 4
MULTINATIONAL CORPORATIONS, PATENT ENFORCEMENT AND ENDOGENOUS
GROWTH

Introduction

A wide range of studies have examined the effects of stronger intellectual property rights

(IPRs) protection in developing countries as all WTO (World Trade Organization) members are

required to strengthen IPRs protection since the Uruguay round of multilateral trade negotiations

in 1994. Helpman (1993) concluded that a stronger IPRs protection hurts the South but benefits

the North, and increases the fraction of products that are produced by multinational corporations

(MNCs). These results are based on assumptions of a low imitation rate, factor price equalization

and a similar risk of product imitation in all type of firms. Lai (1998), assuming infinite life

patents and a higher risk of product imitation for MNCs, examined different methods of

production transfer and the effects of the strengthening of IPRs protection. He emphasized an

important of foreign direct investment (FDI) by showing that if FDI is the main channel of

production transfer, stronger IPRs protection increases the rate of product innovation, production

transfer and improves income distribution between regions. In his model, the rate of

multinationalization is based on optimization of Northern firms.

FDI has been the largest international capital inflow to developing countries in the past

decade. The tremendous increase in FDI, from $22 billion to $325 billion during 1990 to 2006

(World Bank 2007), provides additional financial resource to developing countries for achieving

higher level of economic growth and improving their living standards. Benefits and drawbacks

from FDI vary and depend on various factors including the type of investment, the level of

technology, and the pattern of knowledge diffusion as well as policies and institutions framework

in the recipient countries.









Many studies have used a North-South product cycle trade model to examine the effects of

stronger patent enforcement to FDI. Glass and Saggi (2002) found that stronger Southern IPRs

protection reduces both FDI and innovation. The main assumption behind their result is that

stronger IPRs protection in the South does not alter the expected profit stream of MNCs relative

to that of Northern firms. Branstetter et al. (2007) assumed positive knowledge spillovers and a

reduction in the costs of innovation and imitation overtime. They concluded that IPRs reform in

the South increases FDI and the rate of innovation, decreases imitation rate and improves the

income distribution between regions. These works have examined the effect of stronger IPRs

protection through the change in the cost of imitation and provided indirect link between IPRs

protection and FDI

The purpose of this paper is to analyze the effects of a change in IPRs protection policy,

globalization, and innovation technology on FDI and income distribution between the North and

the South. Our model adopted the same assumption of different risks of product imitation among

firms as in Lai (1998) and Branstetter et al. (2007). The expected discounted profit of MNCs is

directly affected by the change in the probability of patent enforcement in the South. In addition,

we assumed negative knowledge spillovers from FDI and an increase in R&D difficulty overtime

in order to remove the undesirable scale effect property. This paper contributed to the existing

literature by providing a link between FDI and patent enforcement policy and explicitly studying

the effects of a geographic expansion in the size of the South and an improvement in innovation

process on FDI and income distribution between regions.

Model

In the third chapter, we developed a two regions model of North-South trade and

Schumpeterian (R&D-based) growth with free trade. The model followed the quality-ladder

framework where Northern quality leaders invent new products and receive finite patents that are









perfectly enforceable in the North but imperfectly enforceable in the South. Northern quality

leaders have a choice to decide whether to become Multinational Corporation (MNC) in order to

take advantage of lower labor cost by moving their production to the South or to remain in the

North with lower probability of product imitation.

Consumers and Workers

Each region consists of a fixed measure of dynastic households with infinitely lived

members. Each household member is endowed with one unit of labor which is supplied

inelastically to the market. The size of each household grows exponentially at the exogenous rate

of n > 0, where new household members are born continually. We normalized the initial size of

each household to unity for simplification; therefore, the number of household members at time t

equals e"t. Let L, (t) = L,e"' denote the level of Northern population and the supply of labor in

the North at time t, where L, is the initial level of Northern population (households). Similarly,

let Ls (t) = Lse"' denote the level of Southern population and the supply of labor in the South at

time t where Ls is the initial level of Southern population. The world population at time t is


given by L(t) = Le"' = L, (t)+ Ls (t) = (L, + Ls )e"'

The global economy consists of a continuum of industries indexed by B E [0,1]. Each

industry produces a final consumption good of different quality levels which are indexed by j,

where j represents the number of innovations in each industry. Let Aer).t denote the quality

increment generated by each innovation in industry 8, where parameter Ai > 1 captures the size

of each innovation which, by assumption, is identical across industries. Each household

maximizes the following discounted lifetime utility


U "Inu(t)dt, (4-1)









where p > n is the constant subjective discount rate.

The instantaneous per-capita utility function at time t is defined by


Inut)=I [ A ( j, 8, t) 6 (4-2)

where q(j,0, t) denotes the quantity demanded per person of a product in industry B with

quality level A'" at time t. Consumers prefer higher-quality products to lower-quality ones and

choose their consumption to maximize their discounted lifetime utility in three steps. First,

p, (8,t)
consumers choose to consume the product with the lowest quality-adjusted price in


each industry.

Then, consumers allocate their budgets across all industries by solving the across-industry

static optimization problem. The result is the following unit elastic demand function

c(t)
q(B, t) = ,(4-3)
p (B, t)~

where c(t) is each consumer' s consumption expenditure function at time t. Lastly,

consumers solve the dynamic optimization problem in order to maximize their discounted life

time utility


ma~x e "In c(t) + I~n A1'".' -In p(8, t)EI 6t (4-4)


subject to their intertemporal budget constraint z(t) = w(t) + r(t):(t) c(t) nz(t) where

z(t), w(t) and r(t) is the level of consumer assets, the wage rate and the market interest rate at

time t, respectively. Solving the intertemporal problem yields the following differential equation

c(t)
= r(t) p. (4-5)
c(t)









The market interest rate r equals the constant subjective discount rate p as per-capita

consumption expenditure c is constant in the steady-state equilibrium.

Production and Multinationalization

Labor is the only factor of production and perfectly mobile within a country. Labor

markets are perfectly competitive. One unit of labor produces one unit of output for all quality

levels of products. This assumption simplifies the model as each industry has a constant marginal

cost equal to a wage rate. The model is based on quality ladder framework and Bertrand price

competition.

A Northern frm becomes a Northern quality leader when it discovers the new state-of-the-

art product and receives a Einite patent length T > 0 which is perfectly enforceable only in the

North and imperfectly enforceable in the South. The effectiveness of patent enforcement in the

South depends on several factors including the strength of law, regulation, quality of institutions,

resources devoted to enforcement activities, etc. These factors can be captured by the probability

of enforcement which is represented by OZE (0,1) A Northemn quality leader has the following

choice: if a Northern quality leader remains in the North, it faces a lower probability of product

imitation. For simplicity, we assumed that the probability of imitation of a Northern-based firm

is zero. Therefore, a Northemn frm faces the risk of imitation only after it becomes a

multinational company. A Northern quality leader can achieve a higher level of profit by moving

its production to the South in order to take advantage of a lower Southern wage; however, once a

firm becomes a MNC, it faces a higher risk of imitation equal to 1- Z. Define r as the

probability that a firm will become a MNC. The multi-nationalization process is depicted in

Figure 4-1.









A Northern-based firm, producing the-state-of-the-art quality product j in industry B ,

charges p, = Alw, and uses a trigger price strategy to drive out of the market Northern quality

followers and Southern imitators. After the patent expires, products become generic and sell

competitively in the market. The profit flow of the Northern quality leader is

ni~ (t) = (ilw, w, )(q,L, + qsLs) where q, and qs are per-capita quantities demanded by

Northern and Southern consumers respectively. Substituting the demand function from Equation

4-3 and the Northern quality leader' s profit flow can be written as

i -1
uz,(t) = ( )(cN L,'(t)+ cs Is(t)). (4-6)


MNCs face a higher risk of imitation than a Northern-based firm. If the patent is not

enforced in the South with a probability 1- 02, a method of production becomes general

knowledge in the South. There is no imitative R&D in this model since a production method

become general knowledge in the South when there is no patents protection with the probability

of 1- DZ. Southern quality followers produce the product and sell competitively in the South at

price ps = ws. On the other hand, with a probability of patent enforcement 02, MNCs use a

trigger price strategy to drive out Northern and Southern quality followers by setting the price

equal Pa = il Assuming no Eixed cost for MNCs in the South except for production cost,

the expected profit flow of MNCs can be derived similarly as that of a Northern quality leader


where rac (t) = (ilw, ws)qL, + O2(iw, ws)qsLs Define 0i = "- > 1 as a North-South


wage gap. Substituting the unit demand function from consumer maximization problem

(Equation 4-3) the MNCs' profit flow can be written as


we~ (t) = (1 )(cNLN (t) + OZcsLs (t)) (4-7)









The profit flow of MNCs increases in the probability of patent enforcement in the South

2, the size of each innovation ii, and the wage gap between the two regions ro .

Innovation

This model adopted basic assumptions on the innovation technology from Dinopoulos et

al. (2005) where innovation process depends on the amount of labor devoted to research and

development (R&D) activity, the productivity and the difficulty of R&D. Let a be an innovative

R&D productivity parameter and let ev"'t' capture the R&D difficulty, where

0 is a

parameter. A Northern quality leader, who hires 2 units of workers for innovative R&D

at ~dt
activities during a time interval dt, produces dA, = e" a, units of the-state-of-the-art products.


Define dA = C2dAI as the aggregate flow of new products and LA, = CIC as the aggregate

labor in innovative R&D. Then, the economy wide rate of new products can be written

aL~dt dA(t)
as dA = Define A(t) = as the steady-state instantaneous flow of new products then,
ever) dt

the long-run innovation rate can be written as


A(t) = y( (4-8)


Define xi(t) = v, (t)A(t) as the steady-state evolution of R&D difficulty x(t) where

0 < vp (t) <1 is the measure of industries with active patents. We assumed that patents have

negative knowledge spillovers to innovation process. Patents reduce the flow of knowledge

spillovers. A discovery of new product becomes more difficult as more patents is being issued or

protected. The steady-state value of R&D difficulty is given by x(t) = v p~. In the steady-state

equilibrium, the flow of patents A(t) and the measure of industries with active patents v, is









constant over time for a bounded per-capita long-run growth rate. The long-run innovation rate


can be ewritte as At =, a (t)t)e-",, "' '. The term in square brackets is the share of


innovative R&D workers which is constant in the steady-state equilibrium. Moreover,

L(t)e-""(" = Le""-"""t) is constant overtime. Therefore, the steady-state rate of new product can

be written as


A = n (4-9)


The innovation rate is increasing in the population growth rate n but decreasing in the

R&D difficulty parameter p and the measure of industries with active patents v, .

To derive the equilibrium condition in the innovative R&D sector, let (8, t) denote the

market value of a patent of a Northemn-based firm at time t in industry B which can be written as


S, (, t)= 4i, (t + s)e "t'"d~s (4-10)


The value of a patent is identical across industries as we assume structural symmetry.

Substituting the profit function of a Northern-based firm from Equation 3-6 and integrating

Equation 4-10 yields the steady-state market value of a patent for a Northemn-based firm

A-1 1-e~,,r,,,- "p
illi t ( L,(t sn t (4-11)


At the steady-state equilibrium, the value of a Northemn-based firm's patent is increasing in

the patent length T, the quality increment Ai, and the population growth rate n. The value of a

patent is inversely related to the subj ective discount rate p For notation purpose, we define











ry(T) = 1-e to capture the effect of the patent length and the effective discount rate on the
p-n

value of the patent.

Similarly, we can derive Vwc (8, t) as the market value of MNCs' patent at time t in

industry B by substituting the profit function of a MNC from Equation 4-7 in Equation 4-10 and

integrating it yields the steady-state market value of a patent for a MNC


Ve~rrcit)=I 1 c,1L,(t)+ cspst) (4-12)


At the steady-state equilibrium, the value of a MNC's patent is increasing in the duration

of patent T, the quality increment ii, the population growth rate n and the probability of patent

enforcement D2. The value of a patent is inversely related to the subj ective discount rate p .

Next, we derive the zero profit condition in the innovative R&D sector. The market values

at a dt
of the innovative R&D activities can be written as V~dA, = VA yo(t) Define


VA = (1 r V, + qrar~rc as the expected market value of a patent for a Northern quality leader,

where r represents the probability that a firm becomes a MNC. The cost of innovation equal to

(1- TA N i~dt, where TA > 0 is an ad-volarem subsidy to R&D innovation. The discounted net


profits in the R&D sector can be written as ((1- 17)V + q~cvrec"a (1- rA NM, ]dt The

zero profit condition in this sector is a result of the assumption of free entry into innovative R&D





SThere are 2 ways to model international property rights enforcement and imitation. This paper models probability
of patent enforcement with an instantaneous of time where the probability ranges from 0-1. This method works well
with a finite time of patent as we assume in this paper. Another method models probability of imitation with an
exponential distribution where the probability can range from0O 00 This method is preferred if the patent duration
is infinite. See Lai (1998) for detail of the second methodology.









activities. The following equation provides the condition that the marginal product of labor in

innovative R&D equals the subsidy-adjusted wage rate of labor

[(1- q)V, + 1?1, c je (") = (1- TA N ,. (4-13)

From L, (t)e-w't) = Lge'tn-w~t) = L, and the same is hold for Ls, we substitute the steady-

state values of a patent for a Northern-based and a MNC from Equation 4-11 and Equation 4-12

into Equation 4-13 to establish the Innovative R&D condition

agr (T) r,i~ix i1\
(1 )(,, s-)A )+q cNL c~)=(-T (4-14)


Labor Markets

We assumed perfect labor mobility and full employment to prevail within each region. The

demand for labor in the North comes from two activities which include innovative R&D and

manufacturing of new products. The demand for innovative R&D labor can be derived from

substituting the steady-state value of R&D difficulty into the long-run innovative rate which

kt(cp-lv,)
yields the demand for innovative R&D labor as LA (t) = Northern quality leaders


cN (t) cs (t) c(t)
produce L, (t) + Ls (t) -L(t) units of new products, where
p, (8, t) p, (8, t) AIw,

c = (c,L, + csLs )/L is the per-capita global consumption expenditure. Setting aggregate

demand equal to aggregate supply of labor yields the Northern full- employment condition

Ae"'" c(t)L~(t)
L, (t) = -+ (4-15)


Substituting the steady-state rate of innovation A = n- and dividing every term by L(t)
v <

gives us the per-capita Northern full-employment condition










-"- + -(4-16)
L avp~L Alw,

Next, consider the Southern labor market where the aggregate demand for labor comes

from two activities which include manufacturing of MNCs' products and manufacturing of

c(t)
generic products. Each MNC produces L(t) units of new products. There are v, industries


in the South producing MNCs' product; therefore, the demand for labor for manufacturing of


MNCs' product equalsv,L~t (t) Each Southern quality follower produces L(t) c~)units of
AIw, ws

generic products. There are v, industries produce generic products in the South at each instant of


time, where v, + v, = 1 The demand for labor for manufacturing generic products is vL(t) ct


The Southern full-employment condition can be derived by setting the aggregate demand for

labor equal to the aggregate labor supply


Ls (t) = v,L(t) c~)+ vL(t) c~)(4-17)
AIw, ws

Divide the above equation by L(t) and substitute ve = 1 vp yields the per-capita .ainrl i~ n

full-employment condition,

L, v,c (1 vP )
s_-+ (4-18)
L Alw, ws

Steady-State Equilibrium

At the Steady-state equilibrium, a Northern quality leader should be indifferent between

producing in the South as a MNC and producing in the North. Therefore, the value of Northern-










based firm' s patent and those of the MNCs should be equal, where V, = VMce We can use

Equation 4-11 and Equation 4-12 to derive the M~ulti-nationalization equilibrium as

il-li-(p-n)T~ ,cL, +~cL l-(p-n)pT 1(-
]'L, + csLs 1-- (cL, + Oc=s. 4-9


Simplifying Equation 4-19, we can solve for the value of the North-South wage gap which

prevail in the Multi-nationalization equilibrium that can be written as


m = _(4-20)
A -(A 1)(c,L, + csLs
c,L, + OcsLs

The Multi-nationalization equilibrium condition establishes the link between the relative

wage and the probability of patent enforcement where an increase in the probability of patent

enforcement leads to an improvement in the relative wage between North and South. In addition,

the value of the North-South wage gap from Equation (4-20) is greater than unity. This result

contrasts to the wage equalization equilibrium in Helpman (1993). To solve for the explicit

steady-state solution of the North-South wage gap, let the wage of Southern labor be a numeraire

where ws = 1, so that ai = w, > 1 captures the North-South wage gap. The innovative R&D

condition can be rewritten as



ar (1- ) ccL, + csLs A -1)+ --- (c,\/LN + OZcsLs) = 1- T) (4-21)

Substituting the value of the North-South wage gap from Equation 4-20 into Equation 4-

21, we can solve the North-South wage gap in term of the per-capita global consumption

expenditure as

aW(T)(;1 -1)cL
m = (4-22)









To solve for the steady-state value of the global per-capita consumption expenditure, first;

we rewrite the per-capita Northern full-employment condition from Equation 4-16 and the per-

capita Southern full-employment condition from Equation 4-18 in term of the measure of

industries with active patents v,, assuming the wage in the Southern as a numeraire. Then, we

equate both full-employment conditions as

n Lc Ls 20
-~ = -1,\e L .X (4-23)


Substitute the North-South wage gap from Equation 4-20 into Equation 4-23 and let 8

denote the steady-state value of the per capital global consumption expenditure which can be

solved as

Ls L,(1-A

c = (4-24)
L,


Next, we solve for the steady-state value of the North-South wage gap by substitute the

steady-state value of the per-capita global consumption expenditure from Equation 4-24 into

Equation 4-22 and let r$ denote the steady-state value of the North-South wage gap, we have

(1- TA
LsL, -r()i-1 Ls

(1 TA Aj L



Lastly, to find the steady-state value of the measure of industries with active patents, we

solve the per-capita Northern full-employment condition (Equation 4-16) and the per-capita

Southern full-employment condition (Equation 4-18) in term of the North-South wage gap, then

we equate both full-employment condition and substitute the steady-state value of the per-capita









global consumption expenditure from Equation 4-24. Let i;, denote the steady-state value of the

measure of industries with active patents that can be solved as


L,, r (T(l-(1 r ) a3 n
LL, L +

L,
v -.(4-26)
aW(T>(;1- ) a~n
Ls IL, LsI

(T(;1- r )n


Long-Run Schumpeterian Growth

We use the long-run growth rate of each consumer' s utility function to derive the long-run

Schumpeterian growth. At each instant in time, there are v, industries with active patents and v,

industries with inactive patents. The average number of innovations in each of these industries

equals j(B, t) = A(t). The quantity produced by each quality leader in the North or by each MNC

c(t)
in the South equals L(t). each quality follower in the South produces c(t)L(t). Quality


followers in the South produce generic product in the competitive market and charge price equal

to the unit cost of production. We can derive the instantaneous utility of a typical household

member in the North at time t as


In ut) =In A" dO+ InA'"c 8 .(4-2)

Integrating Equation 4-27 yields the level of the instantaneous utility at time t for a typical

Northern consumer


Inu(t)= A(t)1nii v In c, c~loncy (4-28)










The instantaneous utility of a typical household member in the South at time t is


Inut)= InA dB+In A"cs8 (429


Integrating Equation 4-29 yields the level of instantaneous utility at time t for a Southern

consumer


In u~) = At)1n + v n In cs (4-3 0)


In the steady-state equilibrium, all variables on the right-hand side of the Equation 4-28

and Equation 4-30 are constant over time, except for the number of innovations A(t) = At .

Differentiating the level of instantaneous utility with respect to time and using the steady-state

flow of patents from Equation 4-9 yields


g, Aln A In Ai. (4-31)


The long-run growth rate is proportion to the rate of innovation which also depends on the

measure of MNCs. As we assumed an increase in R&D difficulty overtime with an increase in

the measure of industries with active patents, the measure of MNCs inversely relates to the

growth rate due to its effect to the innovation process. The long-run Schumpeterian growth now

depends on all parameters in the model as the measure of MNCs is determined within the model.

The long-run Schumpeterian growth is increasing in the rate of population growth and the size of

innovation but decreasing in the parameter of R&D difficulty.

Comparative Steady-State Analysis

We have solved the steady-state value for the North-South wage gap, the per-capita global

consumption expenditure and the measure of industries with active patents or the measure of

MNCs. Next, we performed various comparative steady-state analyses using both algebraic









calculation and computer simulation to examine the effects of several parameters to the steady-

state value of the North-South wage gap and the measure of MNCs. The following propositions

summarize the main results

Proposition 4-1. An increase in the strength of patent enforcement policy in the South

modeled as an increase in the probability of patent enforcement policy (Of ~) does not affect the

long-run level of Foreign Direct Investment and the long-run wage-income distribution between

North and South.

Proof See Equation 4-25 and 4-26.

It is interesting that the probability of patent enforcement or the effectiveness of patent

enforcement policy dose not matter to the decision of a firm to become MNCs at the steady-state

equilibrium. One explanation is the steady-state value of the relative wage that equalizes the

profit flow of the Northern-based firms and MNCs at the steady-state equilibrium. By

construction of the model, the steady-state value of relative wage between North and South

always adjusts it valued to equalize the profit flow between Northern-based firms at the steady-

state equilibrium

Proposition 4-2. A stronger intellectual property rights protection modeled as an increase

in patent length (T 1)

(i) reduces the flow of Foreign Direct Investment to the South as the measure of Multinational
Corporations in the South decline (v:, 1)

(ii) worsens the long-run wage-income distribution between the North and the South by raising
the relative wage of Northern workers (co, 1)

Proof. See Equations 4-25 and 4-26.

We provided a direct link between a patent length and a flow of FDI. These results are

consistent with Glass and Saggi (2002) and Glass and Wu (2007) where they found that stronger









IPRs protection reduces the flow of FDI but contrast with Lai (1998) and Branstetter et al.

(2007). A longer duration of a patent length enables quality leaders to enjoy longer period of

monopoly profit. This might reduce an incentive for a Northemn based firm to move their

production based to the South region since they faces higher risk of imitation and a reduction in

profit when they become MNCs. As more industries remain in the North with an increase in

patent length, the relative wage of Northern workers will increase as more demand of labor

prevail in the region. This result is consistent with Dinopoulos et al. (2005) who found that an

increase in global patent length worsens the wage-income inequality between the North and the

South.

Proposition 4-3. Globalization, viewed as a permanent increase in the size of the Southern

population (L 1)

(i) increases the flow of Foreign Direct Investment to the South as the measure of industries
with active patents in the South increase (v, 1)

(ii) worsens the long-run wage-income distribution between the North and the South by raising
the relative wage of Northemn workers (co, 1)

Proof. See Equations 4-25, 4-26 and Algebraic Details

One view of globalization is a geographic expansion in the size of the South measured by

the level of Southern population. An example of this view is the entering of China to WTO at the

end of 2001 and the trend of an increase in the openness to trade in developing countries around

the world (Wacziarg and Welch 2003). Our finding contributed to the existing literature by

adding the direct link between globalization and FDI. An increase in the size of the Southemn

market attracts more flows of FDI to the region as the demand for product increases. However,

an increase in the level of population in the South deteriorates the income distribution between

regions as more supply of labor emerges in the market and drives down the relative wage of









Southern workers. Interestingly, the model predicts a complete opposite effect for a permanent

increase in the level of the Northern population (L ?) An expansion in the size of the Northern

market holds back the flow of FDI to the South as the number of MNCs in the South

declines(v, 1) and improves the North-South wage gap as the relative wage of Northern worker

declines. The intuitive explanation is that an expansion in the size of the Northern market might

out weight the cost saving advantage of a lower-Southern wage as the supply of labor in the

North increases.

Proposition 4-4. An improvement in innovation research and development modeled as an

increase in the size of innovation (il 1), the innovative R&D productivity parameter (a 1), and

a subsidy to innovation (zA~

(i) decreases the flow of Foreign Direct Investment to the South as the measure of Multinational
Corporations in the South decline (vp 1)

(ii) worsens the long-run wage-income distribution between the North and the South by raising
the relative wage of Northern workers (co, 1)

Proof. See Equations 4-25 and 4-26.

While, most papers studied the effect of FDI to innovation rate, we used computer

simulation to analyze the effect of an improvement in the innovation process to a firms' decision

to become a MNC. An increase in the size of innovation enables Northern quality leaders to

charge a higher price and achieve a higher level of profit without moving their production to the

South. In addition, the larger innovation size in the North increases the relative wage of Northern

workers as more industries keep their production of the- state- of-the-art product in the North

which in turn increases the North-South wage gap. Other factors that encourage innovation

process such as a subsidy to innovation and an improvement in the innovative R&D productivity

also increase the North-South wage gap and decrease the flow of FDI to the South region.










Proposition 4-4. An increase in the population growth rate (n 1) increases the measure of

Multinational Corporations in the South (vp 1) and the North-South wage gap (c~ 1) while, an

increase in R&D difficulty (cp 1) has the opposite steady-state effect.

Proof. See Equations 4-25 and 4-26.

An increase in the population growth rate leads to an increase in FDI since the market sizes

in both regions expand. This induces the Northern quality leader to move their production based

to the South in order to enj oy higher level of profit. On the other hand, an increase in the level of

R&D difficulty reduces the flow of MNCs as technology transfer between regions might be more

difficult to complete. Moreover, more resources are devoted to innovative R&D sector as the

level of difficulty increase. These results are based on an assumption of negative spillovers of

patents to innovation process.

Conclusion

This paper has introduced an endogenous process of multi-nationalization into a North-

South model with a finite patent protection which is perfectly enforceable in the North but

imperfectly enforceable in the South. The main focus of the paper is to examine the steady-state

effects of patent protection policy, globalization measured as a geographic expansion of

developing countries and changes in innovation technology on the decision of becoming MNCs

and income distribution. We found that stronger IPRs protection in the South modeled as an

increase in patent length decreases the flow of FDI and also worsens the wage- income

distribution between regions. On the other hand, an increase in the size of the Southern

population accelerates FDI but also worsens the North-South wage gap due to an increase in the

supply of labor in the South. Then, we explored the effect of changes in innovation process and










concluded that an improvement in innovation technology leads to a decline in FDI to the South

and also worsens the income distribution between regions.

Further study could be extended in various areas regard patent enforcement and FDI. Trade

cost and technology transfer cost could be introduced into the present model. The structure of

knowledge spillovers from FDI to innovation is also an interesting area to explore. Lastly, a

growing trend known as South-North FDI as occurring between India and United Kingdom

(World Bank 2007) suggests that the innovation could happen not only in the North but also in

the South. A study of the effects from this phenomenon on income distribution and global

innovation is an interesting area of research.

Algebraic Details

To show that the value of the North-South wage gap in Equation 4-20 is greater than 1, let

assume


2 A 1(c,,+css)<1. (4-32)
c,L, + OcsLs

Rearranging Equation 4-32, we have


A<+A1(c,,+ss). (4-33)
c,L, + OcsLs

c,L, + csL
Equation 4-33 is true since a s> 1 from the assumption that the probability of
c,L, + OcsLs

patent enforcement is OZE (0,1) Therefore, Equation 4-32 is also true.

Next, we show the derivation of the North-South wage gap equation from Equation 4-20.

Simplifying the Multi-nationalization equilibrium condition (Equation 4-19) as

;1-1 1
,L,+ s~)=1 (-,+Oss.(-4









Rearranging Equation 4-34, we have

ii-1 c,L, + csLs
= 1 (4-35)
Ai1 c,L, + OcsLs =1 i0,


Adding both side of Equation 4-3 5 with --and rearranging Equation 4-3 5, we have


1 i -1 c,L, + csLs
ii = 1-i (cL,+~cL (4-36)


Multiplying both side of Equation 4-36 with As~i and rearranging Equation 4-36, we have

the North-South wage gap condition as in Equation 4-20.


m = (4-37)

i(~(,, ZcLc,L, + csLs

The derivation of the North-South wage gap in term of the per-capita global consumption

expenditure (Equation 4-22) can be shown by substituting the relative wage from Equation 4-20

to the left- hand side of the Innovative R&D condition (Equation 4-21).







(1- I7)(c,L, +cLsLs X; -1)+ 17 ; _1 (-8


i ic,, Zc,L,cL +csLs,
x C\ 'L. + 1cs Is)

Simplifying Equation 4-38 and rewriting it as


(1-~~cL 9) c,,+ccsA-) qA- scL Oss (4-39)
aryT[,,, +cLx ,~ c,L, + OcsLs: L +~cL










Simplifying Equation 4-39 and using the definition of the per-capita global consumption

expenditure. Then, we equate Equation 4-39 to the right-hand side of the innovative R&D

condition (Equation 4-21) as

aW(T)(A1 -1)cL
= (1- 4)m .(4-40)


Finally, we can solve the North-South wage gap in term of the per-capita global

consumption expenditure as in Equation 4-22 as

aW(T)(A1 -1)cL
m = (4-41)


To solve for the steady-state solution of the per-capita global consumption expenditure, we

rewrite the per-capita Northern full-employment condition (Equation 4-16) in term of the

measure of industries with active patents. From Equation 4-16, we have

nZ L C
-" -(4-42)


Rearranging Equation 4-42, we have

Sn \L, c
v = -(4-43)


Then, we rewrite the per-capita Southern full-employment condition (Equation 4-18) in

term of the measure of industries with active patents. First, we rewrite Equation 4-18 as


s (4-44)


Simplifying Equation 4-44, we have

E L (-m)A
s (4-45)


Rearranging Equation 4-45, we have










v s 1~li (4-46)


Next, we equate Equation 4-43 with Equation 4-46 to solve for the steady-state value of

the per-capita global consumption expenditure as


L
Lc


(4-47)


Simplifying Equation 4-47, we have


L,Ls


Lsc L,c
L AmZ-c L Am~i


(4-48)


Substituting the North-South wage gap from Equation 4-22 into Equation 4-48 as


(4-49)


L,Ls
L2c


Llary(T)(il-1)cL


L, c1r
L ilay(T)(il-1)cL


Multiplying L to both side of Equation 4-49 as


L,Ls
Lc


-L, +
aW(T)(;1 -1)cL a (T)(;1 -1)


(1- rA)n n
pa2W(T)(;1 -1)cL


(4-50)


Rearranging Equation 4-50 as


L,Ls
Lc


Ls(1-r A,)
aW(T)(;1-1)cL pa2 yT)i- lcL


L
SaW(T)(1- 1)


(4-51)


Rearranging Equation 4-51 as


[aW(T)(1- 1) ap n


1I L,Ls
cl L


Ls(1-r A,)
aW(T)(1- 1)L pa2 y(T)(l- 1)L


(4-52)


Using Equation 4-52, we can solve for the steady-state value of the per-capita global

consumption expenditure as in Equation 4-24 as


!no! 1-Am


L c
1 -
L Am


i ~n -1 i,










Ls L, (
L ary(T)(Al -1)L (a p3
c = (4-53)
(1 r ) n
L,


Next, we show the derivation of the steady-state value of the measure of industries with

active patents. First, we solve the per-capita Northern full-employment condition from Equation

4-16 in term of the North South wage gap as


i i l = - ( 4 5 4 )



Second, we solve the per capital Southern full-employment condition from Equation 4-18

in term of the North-South wage gap as



m i = L -( 1 ) ( 4 5 5 )


Then, we equate Equation 4-54 and Equate 4-55 as


s -(1- v )c = vp -"---~ (4-56)


Simplifying Equation 4-56 and moving the measure of industries with active patents to the

same side as

L, n L
s c+- -"v -cv, (4-57)
L apL L

Rearrange Equation 4-57 and solve for the measure of industries with active patents as

v I- I -1c(-8
S\ ~LnI\L










We imposed the condition L, > Ls + -- to ensure that the measure of industries with


active patents is less than unity. Substituting the steady-state value of the per-capita global

consumption expenditure from Equation 4-24 into Equation 4-58, we can solve for the steady-

state value of the measure of the industries with active patent as in Equation 4-26 as

LsL, (-r) n
Ls L ,ary(T)(l- 1)L ap n
L L

v = (4-59)
LsL,(1 ) n
L, L ary(T)(Al -1)L ( ap3
L,


Proof of Proposition 4-3 (i). By differentiate Equation 4-26 with respect to the size of the

Southern population


aWT(;1- r ) (;1- r )
d~LLsLL, Ls + L,-
av (1rn 1rn
dL L,- L,-(1- 1 WT>;- 1

x s- L, + -a3


LL -ar(1 (- r ) n
LsL Ls

L,


Proof of Proposition 4-3(ii). By differentiate Equation 4-25 with respect to the size of the

Southern population










am a(T)(;1-1) Z
aL,


L-
"aW(T)(;1-1)

a(T)(;1 -1) r










North


South


Innovation
MNC rate Production of MNCs
and (r)

Production MNCs products
of become generic
new products with probability






Figure 4-1. Multi-nationalization process in a North-South model









CHAPTER 5
CONCLUSION

We developed a closed-economy product-cycle model and the North-South product-cycle

trade models with different setting in patents protection. We found that globalization has an

adverse effect to the wage-income distribution between regions by increasing the North-South

wage gap. Moreover, with the introduction of foreign direct investment and free trade to the

model, patent protection reduces the flow of foreign direct investment to the South and also

worsens the wage-income distribution between regions. We also found the same steady-state

effects from an improvement in innovation technology to the flow of FDI and the North-South

wage gap. Lastly, we investigated various effects to the resources used in the patent enforcement

sector and found that an increase in patent length induces an increase in the resources used in

patent enforcement sector and increases the probability of patent enforcement in the country. We

concluded that economies with low productivity of R&D have weaker patent enforcement

policies and lower long-run Schumpeterian growth.

Various aspects of the models can be extended for further study. Skilled and unskilled

labors can be introduced to analyze effects to income distribution within a country. An

introduction of trade cost to the North-South model with FDI is also interesting to examine.

Further study regard welfare implication can be investigated. However, welfare analysis is

complicated due to different components that depend on various factors. It is beyond the scope of

the current model to examine the change in the discounted consumer utility overtime. See

Dinopoulos and Segerstrom (2007) for a study of the steady-state welfare analysis where they

examine the change in the steady-state utility paths before and after policies change.










LIST OF REFERENCES


Anderson, J.E., Wincoop, E., 2004. Trade costs. Journal of Economic Literature. 42(3), 691-751.

Bhagwati, J.N., 2004. In Defense of Globalization. Oxford University Press, New York.

Branstetter, L., Fisman, R., Foley, F.C., Saggi, K., 2007. Intellectual property rights, imitation,
and foreign direct investment: Theory and evidence. NBER Working Paper 13033.

Dinopoulos, E., 1996. Schumpeterian Growth Theory: An Overview. In: Helmstadter, E.,
Perlman, M. (Eds), Behavioral Norms, Technological Progress and Economic Dynamics:
Studies in Schumpeterian Economics. University of Michigan Press, Ann Arbor,
Michigan.

Dinopoulos, E., Gungoraydinoglu, A., Syropoulos, C., 2005. Patent Protection and Global
Schumpeterian Growth. In: Dinopoulos, E., Krishna, P., Panagariya, A., Wong, K. (Eds),
Trade, Globalization and Poverty, Routledge, New York. forthcoming.

Dinopoulos, E., Kottaridi, C., The growth effects of national patent policies. Review of
International Economics. forthcoming.

Dinopoulos, E., Segerstrom, P.S., 1999. A Schumpeterian model of protection and relative
wages. American Economic Review. 89(3), 450-472.

Dinopoulos, E., Segerstrom, P.S., 2005, May 16. A theory of North-South trade and
globalization. Retrieved September 7, 2005, from
http:.//bear.cba.ufl .edu/dinopoulos/PDF/NorthSouthTrade.pdf.

Dinopoulos, E., Segerstrom, P.S., 2007, August 6. Intellectual property rights, multinational
firms and economic growth, Retrieved December 3, 2007, from
http:.//bear.cba.ufl .edu/dinopoulos/PDF/MultinationalFirms.pdf

Fan, C.S., Cheung, K.Y., 2004. Trade and wage inequality: The Hong Kong case. Pacific
Economic Review. 9(2), 131-142.

Fink, C., Maskus, K.E., 2004. Intellectual Property and Development: Lessons from Recent
Economic Research. World Bank and Oxford University Press, New York.

Ginarte, J.C., Park, W.G., 1997. Determinants of patent rights: A cross-national study. Research
Policy. 26(3), 283-301.

Glass, A.J., Saggi, K., 2002. Intellectual property rights and foreign direct investment. Journal of
International Economics. 56(2), 387-410.

Glass, A.J., Wu, X., 2007. Intellectual property rights and quality improvement. Journal of
Development Economics. 82(2), 393-415.










Grossman, G.M., Helpman, E., 1991. Quality ladders in the theory of growth. Review of
Economic Studies. 58(1), 43-61.

Grossman, G.M., Lai, E.L.-C., 2004. International protection of intellectual property. American
Economic Review. 94(5), 1635-1653.

Helpman, E., 1993. Innovation, imitation and intellectual property rights. Econometrica. 61(6),
1247-1280.

Hill, C.W.L., 2002. International Business: Competing in the Global Market Place. McGraw-Hill
College, Columbus, Ohio.

Howitt, P., 1999. Steady endogenous growth with population and R&D inputs growing. Journal
of Political Economy. 107(4), 715-730.

Krugman, P.R., 1979. A model of innovation, technology transfer and the world distribution of
income. Journal of Political Economy. 87(2), 253-266.

Lai, E.L.-C., 1998. International intellectual property rights protection and the rate of product
innovation. Journal of Development Economics. 55(1), 133-153.

Lee, J.Y., Mansfield, E., 1996. Intellectual property protection and U.S. foreign direct
investment. Review of Economics and Statistics. 78(2), 181-186.

Maskus, K.E., 2000. Intellectual Property Rights in the Global Economy. Institute of
International Economics, Washington, DC.

Park, W., 2001, December. R&D spillovers and intellectual property rights. Retrieved October
27, 2006, from
http://www. american. edu/academic. depts/cas/econ/faculty/park/RD%20 Spillovers%20IP
Rs.pdf.

Romer, P.M., 1990. Endogenous technology change. Journal of Political Economy. 98(5), 71-
102.

Segerstrom, P.S., 1998. Endogenous growth without scale effects. American Economic Review.
88(5), 1290-1310.

Sener, M.F., 2005 August. Intellectual property rights and rent protection in a North-South
product cycle model. Retrieved January 29, 2006 from
http://wwwl.union. edu/senerm/Research/SenerIPRsR entProtectinP ERJl_6
pdf.

Wacziarg, R., Welch, K. H., 2003. Trade liberalization and growth: New evidence. NBER
Working Paper 10152.

World Bank, 2007. Global Development Finance 2007: The Globalization of Corporate Finance
in Developing Countries. World Bank, Washington, DC.










Wu, Y., 2005. The effects of State R&D tax credit in stimulating private R&D expenditure: A
cross-state empirical analysis. Journal of Policy Analysis and Management. 24(4), 785-
802









BIOGRAPHICAL SKETCH

Pipawin Leesamphandh was bomn in Bangkok, Thailand. She attended Bodin Decha (Sing

Singhasaenee) school from 1990-1994. She graduated from Thammasat University and received

a Bachelor of Arts in economics in 1998. After she received a Master of Arts in Intemnational

Economics and Finance from Chulalongkorn University in 1999, she began to work as a

financial analyst in the financial planning department at Kasikorn Bank. In 2001, she became a

research assistant at the Fiscal Policy Research Institute. Pipawin received a scholarship from the

Thai Govemnment to study economics and began her graduate studies at the University of

Florida, Gainesville, USA in August 2003. She specialized in international trade and economic

theory. After she graduated from the University of Florida in August 2008, she went back to

Thailand and works for the Thai government.





PAGE 1

1 PATENTS, NORTH-SOUTH TRADE AND GLOBAL GROWTH By PIPAWIN LEESAMPHANDH A DISSERTATION PRESENTED TO THE GRADUATE SCHOOL OF THE UNIVERSITY OF FLOR IDA IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE DEGREE OF DOCTOR OF PHILOSOPHY UNIVERSITY OF FLORIDA 2008

PAGE 2

2 2008 Pipawin Leesamphandh

PAGE 3

3 To my parents and my husband for their love and support

PAGE 4

4 ACKNOWLEDGMENTS First and foremost, I would like to thank my advisor, Elias Dinopoulos, for his help and guidance. He has inspired and motivated me th rough his valuable ideas and suggestions. I am grateful for his time, patience and knowledge in economics. I would like to thank my supervisory committee, David Denslow, Steven Slutsky and Ja mes Seale for their comments, suggestions and for reading my dissertation a nd attending committee meetings. Additionally, I appreciate the help and support from my fellow graduate students, office staff and professors in the Economics Department at the University of Flor ida. I thank them for making my years in Florida a memorable experien ce in my life. I am thankful for financial support from the Thai Government and for assist ance provided by the staff of the Office of Civil Service Commission. My personal gratitude goes to Dr. Kanit Sangsubhan, who encouraged me to take this journey and believe in me. Last but not least, I thank my mother (Dr. Wipawee Jamp angern) for her endless love and support, and my father (Nop Usawattanakul) w ho always believes in me. I thank my good friends (Dr. Saijit Daosukho, Dr. Kornvica Pimukmanaskit and Noppun Wongkittikraiwan) for their help and mental support. I would like to thank the Ph adungcharoen family for their kindness. Finally, I thank my beloved husband Theerapat Leesamphandh, for his love and support, for making me feel like I am at home in Florida and for always making me laugh and happy.

PAGE 5

5 TABLE OF CONTENTS page ACKNOWLEDGMENTS...............................................................................................................4 LIST OF FIGURES................................................................................................................ .........7 ABSTRACT....................................................................................................................... ..............8 CHAPTER 1 INTRODUCTION................................................................................................................. .10 2 TECHNOLOGY TRANSFER, TRADE COSTS AND ECONOMIC GROWTH................12 Introduction................................................................................................................... ..........12 Model.......................................................................................................................... ............14 Household Behavior........................................................................................................14 Production and Trade Costs.............................................................................................17 Innovative Research and Development...........................................................................20 Imitative Research and Development..............................................................................23 Labor Markets.................................................................................................................2 6 Steady-State Equilibrium....................................................................................................... .28 Schumpeterian Growth........................................................................................................... 31 Comparative Steady-State Analysis.......................................................................................33 Conclusion..................................................................................................................... .........37 Algebraic Details.............................................................................................................. ......37 3 PATENT ENFORCEMENT POLICIES AND ENDOGENOUS GROWTH.......................44 Introduction................................................................................................................... ..........44 Closed-Economy Model.........................................................................................................46 Household Sector.............................................................................................................46 Domestic Production and Patent Enforcement Sector.....................................................48 Innovation Process...........................................................................................................49 Domestic Labor Market...................................................................................................52 Steady-State Equilibrium....................................................................................................... .53 Long-Run Schumpeterian Growth..........................................................................................54 Comparative Steady-State Analysis.......................................................................................56 Conclusion..................................................................................................................... .........58 4 MULTINATIONAL CORPORATIONS, PATENT ENFORCEMENT AND ENDOGENOUS GROWTH..................................................................................................60 Introduction................................................................................................................... ..........60 Model.......................................................................................................................... ............61 Consumers and Workers..................................................................................................62

PAGE 6

6 Production and Multinationalization...............................................................................64 Innovation..................................................................................................................... ...66 Labor Markets.................................................................................................................6 9 Steady-State Equilibrium....................................................................................................... .70 Long-Run Schumpeterian Growth..........................................................................................73 Comparative Steady-State Analysis.......................................................................................74 Conclusion..................................................................................................................... .........78 Algebraic Details.............................................................................................................. ......79 5 CONCLUSION................................................................................................................... ....87 LIST OF REFERENCES............................................................................................................. ..88 BIOGRAPHICAL SKETCH.........................................................................................................91

PAGE 7

7 LIST OF FIGURES Figure page 2-1 Pricing structure of the Northern quality leaders...............................................................43 2-2 Pricing structure of the Southern quality leaders...............................................................43 3-1 Closed economy’s steady-state equilibrium......................................................................59 4-1 Multinationalization process in a North-South model.......................................................86

PAGE 8

8 Abstract of Dissertation Pres ented to the Graduate School of the University of Florida in Partial Fulfillment of the Requirements for the Degree of Doctor of Philosophy PATENTS, NORTH-SOUTH TRADE AND GLOBAL GROWTH By Pipawin Leesamphandh August 2008 Chair: Elias Dinopoulos Major: Economics We developed a North-South model with global patent protection in the presence of trade costs. The model generated endogenous Schumpeteri an growth and product-cycle trade. The first model was used to analyze the effects of gl obalization through trade liberalization and a geographic expansion in the si ze of the South. A reduction in trade costs worsens the NorthSouth income inequality by increasing the wage -gap between the two regions. Globalization has an ambiguous effect on the steady-state rate of technology transfer and has no effect on either innovation or the growth rate. Next, we built a simple general-equilibrium model of scale-invariant long-run Schumpeterian (R&D-based) growth, finite-lengt h patents, and endogenous patent enforcement policies. The latter were captu red by a probability function which depends on the government resources engaged in the enforcement of pate nts granted to firms that discover new higherquality products. An increase in the patent lengt h raises the probability of patent enforcement; this result is consistent with cross country evid ence showing that patent enforcement and patent duration are complements. In addition, the model predicted that economies with low productivity of R&D researchers have weaker patent enfor cement policies and lower long-run Schumpeterian growth.

PAGE 9

9 Lastly, we introduced an endogenous multi-na tionalization process into a North-South model of scale-invariant long-r un Schumpeterian growth with a finite-length patent protection. The latter is perfectly enforceable in the Nort h but imperfectly enforceable in the South. The model was used to examine the effects of inte llectual property rights po licy and globalization on Foreign Direct Investment (FDI) and the world in come distribution. The effectiveness of patent enforcement does not effect the decision of a firm to become MNCs. However, an increase in patent length reduces the flow of FDI and worsens the income distribution between regions. In addition, globalization, measured as a geographic expansion in the size of the South, increases the flow of FDI but worsens the North-South in come distribution. Lastl y, an improvement in innovation technology leads to a decline in FD I and worsens the North-South wage gap.

PAGE 10

10 CHAPTER 1 INTRODUCTION We developed three models to study various i ssues in international economic field such as globalization, intellectual property rights (IPRs) protection and fo reign direct investment. All models are based on similar building blocks of quality-ladder framework, finite patent length, and Bertrand price competition. Ea ch model has quality leaders w ho invent the new state-of-theart product and enjoy global monopoly profit as they sell product to the world using limit pricing. There are quality followers in each mode l with different patent protection policy. In addition, all three models are based on the sa me innovation technology where we assumed an increase in Research and Development (R&D) difficulty overtime in order to remove an undesirable scale effect pr operty from the model. The first model is a North-South product-cycl e trade model with global patents protection. We introduced trade costs into th e first model to examine the e ffect of globalization to global innovation, imitation and wage-income distribution between regions as trade costs are an integral part in the international trade flow. In the fi rst model, quality followe rs in the North produce generic products while quality leaders in the Sout h target generic products in the North for their imitative R&D. The second model is a closed-economy model with imperfect patent enforcement policy. We introduced a resource-using endogenously de termined patents-enforcement mechanism to examine the link between patent length, and vari ous factors to resources used in the patent enforcement sector. Intellectual property right s protection becomes a major sector that many countries are required to allocate their scarce resources in order to meet the minimum standard set by the agreement on Trade-Related Aspects of Intellectual Property Right (TRIPs). Quality leaders receive a finite patent with some proba bility of patents protection. There is no imitative

PAGE 11

11 R&D since the method of production of the newl y invented product becomes general knowledge without patents protect ion; therefore, quality follow ers can produce and sell products competitively in the market. The third model is a North-South product-cycle trade model with free trade. We introduced endogenous multi-nationalization process to inves tigate the effect of patents protection, globalization and innovation techno logy to the flow of foreign direct investment and wageincome distribution between regions. Northern qual ity leaders received patent protection that is perfectly enforceable only in the North but impe rfectly enforceable in the South. There is no imitative R&D in this model as Southern qual ity followers can produce and sell the products when there is no patents protection and the method of production becomes general knowledge. Therefore, only multi-national corporations face th e risk of imitation after they transfer their production based to the South.

PAGE 12

12 CHAPTER 2 TECHNOLOGY TRANSFER, TRADE COSTS AND ECONOMIC GROWTH Introduction International trade has continua lly expanded and become a large share of the world income in the past decade. This continuing trend indicat es the acceleration of gl obalization in the world economy. Globalization leads to a substantial redu ction in trade costs which include: a sharp drop in the price of communicati on due to the intense competiti on in telecommunication markets and the emergence of the intern et technology, an increase in cheaper and faster modes of transportation, and a decline in barriers to trades in goods a nd services under the General Agreement on Tariffs and Trade (GATT). The av erage tariff rate on manufactured goods in developed countries has dropped sh arply from 20 % to approximately 4 % in the past 50 years (Hill 2002) However, trade costs still remain as a si gnificant portion of inte rnational trade flow. Anderson and Wincoop (2004) estimated a 170 % ad-val orem tax equivalent of total trade costs for developed countries. We developed a simple product-cycle trade mode l that incorporates trade costs in order to analyze the effect of globalization to th e world income distribution. Trade costs can be considered as all costs incurred in getting a good to final consumers other than the marginal cost of producing the good itself which in clude costs related to transportation, policy barriers, information, contract enforcement, currency exchange ris k, regulation and local distribution. Anderson and Winc oop (2004) provided empirical st udies of trade costs and emphasized the importance of trade costs in interna tional trade flows. In general, trade costs can be classified into two main categories which ar e domestic and international trade costs. This paper emphasizes only the international trade co sts since the domestic trade costs are faced by both domestic and foreign firms.

PAGE 13

13 A class of North-South trade models has l ong been developed in conjunction with the development of the new growth theory starting with the pioneer work of Krugman (1979). The state-of-the-art dynamic NorthSouth models featuring endoge nous Schumpeterian (R&D-based) growth have been extensively us ed to examine various aspects of interest in the international trade and growth literatures. Di nopoulos et al. (2005) found that globalization, modeled as an increase in the size of the South, worsens the wage-income distribution between the North and the South, increases the rate of imitation and does not affect the long-run rate of innovation and growth. While, an increase in the global pa tent length worsens the wage-income inequality between the North and the Sout h, increases the rate of produc t imitation and has an ambiguous effect on the long-run Schumpet erian growth. Their main assu mptions are zero transportation cost and enforceable global patent protection. Dinopoulos and Segerstrom (2005), also assumi ng free trade and DixitStiglitz consumer preferences, concluded that gl obalization taking the form of an expansion in the size of the South, leads to less wage-income inequality betw een the Northern and the Southern workers, increases the imitation rate and speeds up the technological cha nge, while stronge r intellectual property protection has the opposit e steady-state effect. Next, Di nopoulos and Segerstrom (1999) introduced tariffs into the North-North trade mo del where workers have different skill levels. They concluded that trade liberalization reduces th e relative wage of unskilled workers, increases R&D investment, boosts the rate of technology cha nge and results in skill upgrading within each industry. Other studies relating patent protection, intellectual propert y rights and growth include Sener (2006), also assuming free trade, found that str onger intellectual propert y rights protection leads to a larger North-South wage gap and reduces the rate of innovation and imitation. In

PAGE 14

14 addition, more integration of the South into the world economy, taking the form of an increase in relative size of the Southern populat ion, also leads to a larger No rth-South wage gap and reduces the rate of innovation, but incr eases the rate of imitation. The contribution of this model is that we exam ined the effects of gl obalization to the wageincome inequality between the North and the So uth and the rate of in ternational technology transfer by taking into account the presence of trade costs and enforceable global patent protection. In this model, globalization takes the form of not only an increase in the size of the South, but also a reduction in international trade costs. Model We generalized the North-South model of tr ade and growth by Dinopoul os et al. (2005) by introducing international trade costs. The model followed the quality-ladder framework assuming a finite patent length and increasing R& D difficulty over time in order to remove the undesirable scale effects property. The model generated endogenous long-run Schumpeterian (R&D-based) growth which depe nds on patent length and the ra te of population growth. This study added to the existing NorthSouth trade models by explicitly studying the long-run effects of trade costs on the global wage-income ine quality and the rate of international technology transfer. Household Behavior The global economy consists of two regions: the innovating-North and the imitating-South. Both regions are assumed to have common trad e costs and identical consumers’ preferences. World population grows at an exogenous rate n > 0. There is a fixe d measure of dynastic households with infinitely lived members. Each household member is endowed with one unit of labor which is supplied inelastically to the market. New household members are born continually; therefore, the size of each household grows exponen tially at the rate of n > 0. We

PAGE 15

15 simplified the model by normalizing the initial si ze of each household to unity. The number of household members at time t is then, nte. Let nt N Ne L t L ) ( denote the level of the Northern population and the supply of labor in the North at time t, where NL is the initial level of the Northern population. Similarly, let nt S Se L t L ) ( denote the level of th e Southern population and the supply of labor in the South at time t where SL is the initial level of the Southern population. The world population at time t is given by nt S N S N nte L L t L t L e L t L ) ( ) ( ) ( ) ( There is a continuum of industries indexed by 1 0 Each industry produces a final consumption good with different quality level. Th e quality level of a pr oduct is indexed by j, where j is restricted to intege r values and represents the numbe r of innovations in each industry. Let ) (t j denote the quality level of a product in industry where 1 is the quality increment generated by each innovation which, by assumption, is identical across industries. Each household, modeled as a dynastic fa mily, maximizes the following discounted lifetime utility 0 ) () ( ln dt t u e Ut n, (2-1) where n is the constant su bjective discount rate. The instantaneous per-capita utility function at time t is defined by 1 0) ( ln ) ( ln d t j q t uj j, (2-2) where ) (t j q denotes the quantity demanded per person of a product in industry with quality level j at time t. Equation 2-2 is the standa rd quality-augmented Cobb-Douglas utility function across all industries. It also implies that consumers prefer higher quality products.

PAGE 16

16 The consumer’s problem is solved in three stages: First, each consumer considers the within-industry static optimization problem. j j qt j q ) ( max) ( (2-3) subject to jt c t j q t j p ) ( ) ( ) ( where ) ( t j p is a consumer price of product j in an industry at time t and ) ( t c is per-capita expenditure. The solution to this withinindustry optimization problem is to buy the produ ct with the lowest quality-adjusted price j jt p ) ( If two products have the same adjusted price, consumers always buy the higher-quality product. Second, consumers allocate their budgets ac ross all industries by so lving the following across-industry static optimization problem. d t qt j q 1 0 ) ( ) () ( max (2-4) subject to 1 0) ( ) ( ) ( t c d t q t p where ) (t q is per-capita quantity demanded for the lowest quality-adjusted price product in industry at time t, ) (t j is the quality index of the product with the lowest qualit y-adjusted price in industry at time t, ) (t p is the price of the product and ) (t c is per-capita consumption expenditure at time t. The solution to this static problem yields a unit elastic demand function. Grossman and Helpman (1991) provided a detail derivation of this unit el astic demand function. ) ( ) ( ) (t p t c t q (2-5)

PAGE 17

17 Lastly, consumers solve the dynamic optimi zation problem by substituting the demand function from Equation 2-5 into the instantaneous per capita util ity function (Equation 2-2) and maximizing discounted life time utility (Equation 2-1). dt d t p t c et j t n t c 0 1 0 ) ( ) ( ) () ( ln ln ) ( ln max (2-6) subject to an intertem poral budget constraint ) ( ) ( ) ( ) ( ) ( ) ( t nz t c t z t r t w t z ,where z(t) is the level of consumer assets at time t, w(t) is the wage rate at time t, and r(t) is the market interest rate at time t. The solution to this optimal control problem yields the following wellknown differential equation ) ( ) ( ) ( t r t c t c. (2-7) At the steady-state equilibrium, per-capita cons umption expenditure is constant. Therefore, the market interest rate equals the constant subjective discount rate. Production and Trade Costs Labor is the only factor of production and pe rfectly mobile within each region. Labor markets are perfectly competitive in both regions One unit of labor produces one unit of output independently of its quality level or location in each industry. Therefore, each industry has a constant marginal cost which is equal to the wa ge rate in each region. The model follows the quality-ladder framework and assumi ng Bertrand price competition. Only Northern producers engage in innovativ e R&D activities. A Northern firm that discovers a new product becomes a Northern qualit y leader and receives a perfectly enforceable global patent of finite duration T > 0. A Northe rn quality leader enjoys a flow of temporary monopoly profits by selling the prod uct to the world. The-state-of the-art product turns generic as its patent expires and is then produced under perfect competition. The method of production

PAGE 18

18 becomes general knowledge only in the North. Sout hern firms, having a cost advantage from a lower-wage rate, target generic products in th e North for imitation. A Southern firm that successfully copies a Northern product becomes a Southern quality leader and enjoys global monopoly profits until the next hi gher-quality product is discove red and a Northern quality leader replaces a copied product through limit pricing. In the steady-state equilibrium, only Southern quality leaders target generic products and only Northern quality leader s produce new products. Let Nw and Sw denote the wage in the North and the South respectively and 1 represents trade costs, where 1 is the ad-valorem tax equivalent of trade cost. If S Nw w, then imitation occurs only in the South. Also, if S Nw w then innovation takes place only in the Nort h. As a result, we assume that at the steady-state equilibrium the fo llowing condition is satisfied S N Sw w w (2-8) A Northern quality leader, producing the st ate-of-the-art quality product j in industry charges N Nw p to drive out Northern quality follo wers who produce the j-1 product. If a product j-1 has been successfully copied by a Southern firm, a Nort hern quality leader initially charges S Nw p to drive a Southern quality leader ou t of the market. Assuming the existence of substantial re-entry costs in the South, a Northern quality leader can use a trigger price strategy to charge N Nw p after a Southern quality leader exits the market. This process is illustrated in Figure 2-1. The profit flow of the Northern quality leader is derived by calculating the profit from the sale in each region using prices and costs previously described. Define L L c L c cS S N N/ ) ( as the per-capita global consumption expenditure We use the per-capita global consumption

PAGE 19

19 expenditure to derive the global demand for each t ype of product. The prof it flow of a Northern quality leader can be written as S S N N N N N N NL q w w L q w w ) ( whereNq and Sq are per-capita quantities dema nded by Northern and Southern consumers respectively. Substituting a demand function, previously solved in the consumer problem (Equation 2-5) by using the per-capita global consumption expenditure then, a Northern qualit y leader’s profit flow can be written as ) ( ) ( ) ( ) ( ) ( 1 t cL t L t L t L t LS N N (2-9) The profit is generated from a ge neral price marked-up from its cost. An increase in trade costs reduces Northern firms’ profits. Trade costs impose an additional constraint on the size of each innovation. The next innovation needs to have a quality increment parameter greater than trade costs in order for a Northern qualit y leader to be prof itable in the South. (2-10) A Southern quality leader charges the limit price N Sw p* to drive its Northern competitors out of the market and charges N Sw p in the domestic market. Notice that a Southern quality leader also se lls a product at a higher price in home market in the presence of trade costs. Figure 2-2 illustrates the pricing structure in the pres ence of trade costs. The profit flow for a Southern quality leader can be written as S S S N N N S N SL q w w L q w w ) ( Define 1 S Nw w as a North-South wage gap. Substituting per-capita quantity demanded from consumer maximization problem (Equation 2-5) using the per-capita global consumption expenditure then, a Southern quality lead er’s profit flow can be rewritten as

PAGE 20

20 ) ( 1 ) ( ) ( t cL Lt Ls t L t LN S (2-11) For a given level of the relative wage an increase in trade costs may increase or decrease a Southern quality l eader’s profit, depending on the size of the population in both regions. If N SL L then the profit of a southern quality leader increases in trade costs and vice versa. The following condition guarantees positive pr ofits associated with exports for a Southern quality leader (2-12) Innovative Research and Development This model adopted basic assumptions on innovation and imitation technology from Dinopoulos et al. (2005) where the main focus is on the balanced -growth equilibrium properties of the model. This is done for both tractability and comparability. Define as an innovative R&D productivity parameter and let ) (t xecapture the R&D difficulty at long-run equilibrium where0 is a parameter. A Northern firm i produces with certainty ) (t x i ie dt dA units of the state-of-the-art quality products when it hires i units of workers for innovative R&D activities during a time interval dt. Also define i idA dA as the aggregate flow of new products and i i AL as the aggregate labor in innovative R&D activities. Then the economy wide rate of patents can be written as ) ( t x Ae dt L dA and dt t dA t A ) ( ) ( is the steady-state in stantaneous flow of new products per industry. The long-r un innovation rate can be written as ) () ( ) (t x Ae t L t A. (2-13)

PAGE 21

21 Define ) ( ) ( ( ) ( t A t v t xp as the steady-state evolution of ) ( t x where 1 ) ( 0 t vp is the measure of industries with active patents. The parameter ) 1 1 ( captures the correlation between the patent length and Schumpeterian growth. takes a negative value when patents enhance the innovation process by reduci ng R&D difficulty. On the other hand, takes a positive value when patents reduce the flow of knowledge spillovers and increase R&D difficulty. Lastly, 0 when there is structural symmetry across industries. In the steady-state equilibrium, the meas ure of industries protected by patents ) ( t vp is bounded and must be constant over time. The flow of patents ) ( t A is also constant over time in order to have a bounded per-capita long-run gr owth rate. The steady-state value of R&D difficulty is given by t A v t xp) ( ) ( (2-14) Differentiating Equation 2-13 with respect to labor yields, ) () (t x Ae L t A the productivity of R&D workers whic h decreases over time. This im plies that the innovative R&D labor requirement increases over time in the steady-state equilibrium. Rewrite the long-run innovation rate (Equation 2-13) as ) () ( ) ( ) ( ) (t x Ae t L t L t L t A The term in square brackets is the share of innovative R&D workers and will be cons tant in the steady-state equilibrium. Since ) ( t A is constant over time, the term )) ( ( ) () (t x tn t xe L e t L will also be constant over time. Substituting the steady-state value of R&D difficulty x(t) from Equation 2-14, the steady-state rate of new products can be written as pv n A (2-15)

PAGE 22

22 The steady-state rate of new products is directly related to population growth n, and inversely related to the R&D difficulty parameter and the measure of industries with Northern quality leaders raised to the power which provides the endogenous link between patent coverage and the rate of innovation A When 0 the steady-state rate of innovation is exogenous. Northern firms target generic products fo r engaging in innovative R&D activities. Let ) ( t VA denote the market value of a patent at time t in industry that can be written as T s t r N Ads e s t t V0 ) () ( ) ( (2-16) Assuming structural symmetry across all industrie s, consequently the value of a patent is identical across industries. Subs titute the Northern firm’s profit function from Equation 2-9, using the result from the consumer optimiza tion problem (Equation 2-7) and integrating Equation 2-16 yields the steady-state market valu e of a typical patent ) ( ) ( ) ( ) ( ) 1 ( 1 ) ( ) () (t L t L t L t L n e t cL t VS N T n A (2-17) At the steady-state equilibrium, the value of a typical patent is increasing in the patent length T, the quality increment and the population growth rate n. The value of a patent is inversely related to trade costs and the subjective discount rate A Northern firm i that hires i units of workers for innova tive R&D activities during a time interval dt produces the-state-of-the -art product with a market value of ) (t x i A i Ae dt V dA V The cost of innovation is dt wi N A ) 1 ( where 0A is an ad-volarem subsidy to R&D innovation. The discounted net pr ofits can be rewritten as dt w e Vi N A t x A) 1 () ( We

PAGE 23

23 assumed free entry into innovativ e R&D activities; as a result, the zero profit condition must prevail in the R&D innovation sector. The follo wing equation provides the condition that the marginal product of labor in innovative R&D equa ls the subsidy-adjusted wage rate of labor. N A t x Aw e V ) 1 () ( (2-18) Substitute the steady-state value of patent AV from Equation 2-17 and the steady-state value of R&D difficulty ) ( t x from Equation 2-14, we have ) (t xe ) ( ) ( ) ( ) ( ) 1 ( 1 ) () (t L t L t L t L n e t cLS N T n =N Aw ) 1 ( (2-19) From N t x tn N t x NL e L e t L )) ( ( ) () ( the innovative R&D condition can be obtained as L L L L n e L cS N T n ) 1 ( 1) (=N Aw ) 1 ( (2-20) The innovative R&D condition shows a positiv e linear relationship between per-capita global consumption expenditure and the Northern wage rate. As per-capita global consumption expenditure increases, the innovati on price increases. In order to restore the zero profit condition for net discounted profit, the wage of Northern workers need to be increased. Imitative Research and Development Assume that the process of imitation is endogenous and depe nds on the amount of workers used. Also, assume that products become more difficult to copy as the population increases. Southern firms target generic products for im itative R&D activity. A Southern firm j hires j units of workers for imitative R&D during time interval dt and succeeds in copying ) ( t L dt dMj j units of generic products, where is an imitative productivity parameter. Define

PAGE 24

24 j j Mt L ) ( as the aggregate labor devoted to R&D imitation. The economy wide rate of imitation can be written as ) ( ) ( ) ( t L t L t MM (2-21) where dt dM M and j jdM dM. The aggregate rate of imitation depends on the share of labor devoted to imitative R&D. Let ) ( t VM denote the expected discounted profit of a successful imitator j of a product in industry at time t. A Southern firm j hires j units of workers for imitative R&D during time in terval dt and succeeds in copying ) ( t L dt dMj j units of generic products with a market value of ) ( ) ( ) ( t L dt t V dM t Vj M j M At the same time interval, the cost of imitative R&D equals the subsidy-adjusted wage dt wi S M) 1 ( where M is an ad-valorem subsidy to imitative R&D. Al so, we assumed that there is free entry into imitative R&D activities which leads to the zer o profit condition in the imitative R&D sector. The following imitative R&D condition can be obtain ed where a firm hires labor until the value of the marginal product of labor devoted to imitative R&D equals the subsidy-adju sted wage in the South S M Mw t L V ) 1 ( ) ( (2-22) To find expected discounted profit MV, we use no arbitrage condition and a stock market valuation of a Southern monopoly profit. Denote Nv as a measure (and set) of industries with Northern quality followers, Sv as a measure of industries with a Southern quality leader and Pv as a measure of industries with a Northe rn quality leader. We assume that 1 S N Pv v v

PAGE 25

25 During the time interval dt, a Sout hern firm which does not have pa tent protection faces a risk of default from a creative-destruction pr ocess with instanta neous probability N Sv v dt t A ) (. The generic product can be replaced by the discovery of a hi gher-quality product in the North. Then, a Southern quality leader suffers a loss equal to (MV 0). If there is no discovery of the next higher-quality product, a Southern firm receives a capital gain equal to dt V dVM M Therefore, the no arbitrage condition is dt t r dt v v A V V dt v v A dt V V dt VN S M M N S M M M S) ( 0 1 (2-23) The first term in the left-hand side represents a dividend from investi ng in the stock of an imitative R&D firm. The second term denotes the cap ital gain when there is no discovery and the last term denotes the capital loss if there is a discovery of a new higher-quality product. The right-hand side is a riskless rate of return. Taking limits as dt approaches zero and solving for the market value of a Southern quality leader yields M M N S S MV V v v A r V (2-24) Substitute a Southern profit (Equation 2-11) into Equation 2-24. In the steady-state equilibrium, ) (t r and n V VM M ; therefore, the Southern market value can be written as n v v A t cL t L t L t L t L t VN S S N M ) ( ) ( ) ( 1 ) ( ) ( ) (. (2-25)

PAGE 26

26 Substituting Equation 2-25 into the zero pr ofit condition (Equation 2-22) yields the imitative R&D condition n c w L L L LS M S N ) 1 ( 1, (2-26) where N Sv v A is the risk of default for a Southern quality leader. Labor Markets We assumed prefect labor mobility and full empl oyment to prevail within each region. The demand for labor in the North comes from th ree activities which in clude innovative R&D, manufacturing of new products a nd manufacturing of generic produc ts. First, one could derive the demand for innovative-R&D labor by substitu ting the steady-state va lue of R&D difficulty (Equation 2-14) into the long-run innovation rate (Equation 2-13). These substitutions yield the following expression for innovative-R&D labor ) () (pv A t Ae A t L Second, each Northern quality leader produces ) ( ) ( ) ( ) ( ) ( ) (*t L t p t c t L t p t cS N S N N N units of new products. Substitute the price N Nw p and N Nw p yields the quantity produced as ) ( ) ( t L w t cN. There are Pv industries producing new products; th erefore, the demand for labor in manufacturing new products equals ) ( ) ( t L w t c vN p. Using the same method ology and noticing that there are Nv industries producing gene ric products in the North, the demand for labor in manufacturing of generic pr oducts can be written as ) ( ) ( ) ( ) ( ) ( ) ( t L t L t L t L w t L t c vS N N N. The Northern

PAGE 27

27 full-employment condition can be derived from setting the aggregate demand equal to the aggregate supply ) ( ) ( ) ( ) ( ) ( ) ( ) ( ) ( ) () (t L t L t L t L w t L t c v w t L t c v e A t LS N N N N p v A t Np (2-27) Substitute the steady-state rate of new product pv n A and divide Equation 2-27 by L(t). results in the per-capita Northern full-emp loyment condition which can be written as L L L L w c v w c v L v n L LS N N N N p p N (2-28) Next, we considered the Southern labor ma rket. The aggregate demand for labor comes from two activities which are imitative R&D and manufacturing of generic products. Using Equation 2-21, the demand for imitative R&D labor can be written as ) ( ) ( t L M t LM Each Southern quality leader produces ) ( ) ( ) ( ) ( ) ( ) ( t L t L t L t L w t L t cS N N units of generic products. There are Sv industries copying generic product s in the South at each instan t of time. The Southern fullemployment condition can be de rived by setting the aggregate demand for labor equal to the aggregate labor supply ) ( ) ( ) ( ) ( ) ( ) ( ) ( ) ( t L t L t L t L w t L t c v t L M t LS N N S S (2-29) Dividing Equation 2-29 by L(t), the per-capita Southern fu ll-employment condition is L L L L w c v M L LS N N S S (2-30)

PAGE 28

28 Steady-State Equilibrium We focused on the balanced growth equilibrium in which each variable grows at a constant rate over time. Variables that are constant in th e steady-state equilibrium are the market interest rate r, per-capita global consumption expenditure c, all product prices, wage rates Nw and Sw the rate of innovation A, the rate of imitation M the measure of industries with a Northern quality leader Pv, the measure of industries with Nort hern firms producing generic products Nv and the measure of industries w ith a Southern quality leader Sv Variables that grow at the constant rate of population growth rate include quantities produ ced, labor allocated to various activities, the flow of Southern and Northern profits and the market value of quality leaders. To solve for the steady-state equilibrium solu tion, let the wage of Southern labor be a numeraire 1 Sw so that 1 Nw captures the North-South wage gap. In the steady-state equilibrium, the measure of industries with a Nort hern quality leader is related to the strictly positive patent length as T A ds A vT p 0. (2-31) Since patent protection is finite and the rate of patents is c onstant overtime, the measure of industries with active patents protection is equal to the rate of innovation times the patent length 0 T. Substituting the steady-state rate of ne w product (Equation 2-15), the steady-state solution for the measure of industries with a Northern quality leader can be obtained as 1 1Tn vp. (2-32) We imposed the condition Tn to ensure that the measure of industries with patent protection is less than un ity. The fraction of industries with a No rthern quality lead er increases in

PAGE 29

29 the rate of population growth a nd the patent length. Substituti ng Equation 2-32 to Equation 2-15, we rewrite the steady-state solution for the rate of global innovation whic h equals the flow of patents as ) 1 ( ) 1 ( 1 T n A (2-33) The long-run rate of global innovation is incr easing in the rate of population growth and decreasing in the R&D difficulty parameter An increase in the parameter raises the level of R&D difficulty and reduces the rate of innova tion. The relationship between the long-run rate of global innovation and the patent period depends on the parameter Denote variables with a hat ) (^ as the long-run equilibrium value of endogenous variables. The explicit steady-state soluti on for all variables can be so lved using the innovative R&D condition (Equation 2-20) and the imitative R&D condition (Equation 2-26). The steady-state value of global per-capita consumption expenditure can be written as ) ( ) 1 ( ) ( 1 1 1 ) 1 )( ( ˆS N M S N S N S N T n AL L L n L L L L L L e n c .(2-34) The steady-state value of the North-South wage gap can be written as S N S N S N S N T n A ML L L L L L L L e n n L 1 1 ) ( ) ( 1 1 ˆ) (, (2-35) where pv A 1 is the risk of default for a Southern quality leader. Substitute the steadystate solution for the measure of industries with a Northern quality l eader (Equation 2-32) and the rate of global innovation or th e flow of patents (Equation 2-33) can be written as

PAGE 30

30 1 1 11 1 Tn T. (2-36) The long-run North-South wage gap is increasin g in factors that enhance the process of innovation including the productivi ty of innovative R&D labor the subsidy to innovative R&D A and the magnitude of innovations On the other hand, th e long-run North-South wage gap is decreasing in parame ters that encourage the transfer of technology from the North to the South which includes the productivity of imitative R&D labor and the subsidy to imitative R&D M The detail calculation is provided in th e Algebraic detail sec tion. In addition, we used computer simulation analysis to check for the wage equilibr ium condition (Equation 28) that we imposed earlier and f ound that there is a range of diffe rent value of parameters that satisfied the upper and lower limit from Equation 2-8. For instance, if the subsidy to imitation or innovation is equal or close to unity, the size of innovation need to be greater than S N S NL L L L 2. However, this is just a sufficient condition but not a necessary condition for the steady-state wage condition (Equation 2-8) to hold. To solve for the steady-state value of the rate of imitation, adding the per-capita Northern full-employment condition (Equation 2-28) and the per-capita Southern full-employment conditions (Equation 2-30) then, substitute the stea dy-state solution for the measure of Northern quality leaders (Equation 2-32) L L L L Tn Tn w c M L Tn nS N N1 1 1 1 11 1 (2-37)

PAGE 31

31 Using the innovative R&D condition (Equation 220), the steady-state ra te of imitation can be written as S N T n A S N S NL L e n L L L Tn L L L L T n dt M d 1 ) 1 ( ) 1 ( ) 1 )( ( 1 1 ˆ) ( 1 1 1 1 1 1 (2-38) The steady-state value of the measure of indus tries with the Southern quality leaders can also be solved using the Southern full-employment condi tion and the steady-state rate of imitation. Schumpeterian Growth To derive the long-run Schumpeterian growth, we considered the long -run growth rate of each consumer’s utility function. Let) ( t A denote the economy-wide number of innovations at time t, as well as the average number of innovatio ns per industry since the measure of industries is normalized to unity and all industries are struct urally identical. At each instant in time, there are pv industries with a Northern qu ality leader. The average number of innovations in each of these industries is ) ( ) ( t A t j Northern quality leader charge Np in the North and charge *Np The remaining industries S Nv v are characterized by an average number of innovations) ( ) ( t A t j Every Southern quality leader and every competitive firm in the North producing a generic product char ges a price equal to the Northern wage in the North *Sp and charges a price equal to the wage times trade costs in the South. Sp Thus, the instantaneous utility of a typical household member in the North at time t is

PAGE 32

32 pS Nvv v N t A N t Ad c d c t u ) ( ) (ln ln ) ( ln. (2-39) Integrating Equation 2-39 yields the level of the instantaneous utility at time t for a typical Northern consumer N S N N pc v v c v t A t u ln ) ( ln ln ) ( ) ( ln. (2-40) The instantaneous utility of a typical household member in the South at time t is pS Nvv v S t A S t Ad c d c t u ) ( ) (ln ln ) ( ln. (2-41) Integrating Equation 2-41 yields the level of instantaneous utility at time t for a Southern consumer S S N S pc v v c v t A t u ln ) ( ln ln ) ( ) ( ln. (2-42) In the steady-state equilibrium, all variables on the right-hand side of the Equations 2-40 and Equation 2-42 are consta nt over time, except for the number of innovations t A t A ) (. Differentiating the level of instantaneous utility with respect to time and using the steady-state flow of patents (Equation 2-33) yields ln ln) 1 ( ) 1 ( 1 T n A u u gU (2-43) The model has a steady-state equilibrium th at generates a process of Schumpeterian creative destruction which result s in product-cycle trad e, long-run scale-inva riant Schumpeterian growth and a North-South wage gap. Growth is proportional to the rate of innovation A which is equal to the steady-state flow of patents. More importantly, the rate of innovation depends on patent protection which is governed by the parameter ) 1 1 ( that captures the structure of

PAGE 33

33 knowledge spillovers. In the case of symmetric knowledge spillovers ) 0 ( long-run growth is exogenous. If patents d ecrease knowledge spillovers) 1 0 ( then an increase in patent protection decreases long-run Schu mpeterian growth. In contrast if patents enhance knowledge spillovers, an increase in patent protection in creases long-run Schumpet erian growth. With the imposition of trade cost, we still obtain the same properties of long-run Schumpeterian growth as in the absence of trade cost. The long-run Schumpeterian growth is increasing in the rate of population growth and the size of innovation but decreasing in th e parameter of R&D difficulty as in Dinopoulos et al. (2005). Comparative Steady-State Analysis We have solved the steady-state value for each variable of interest. In this section, we studied the long-run effects of globalization and intellectual prope rty rights. As in Dinopoulos et al. (2005), globalization is viewed as a geographic once-for-all incr ease in the size of the South measured by the level of the Southern population. The entering to World Trade Organization by China at the end of 2001 is an important exam ple of globalization in this aspect. This globalization trend is also supported by a st udy from Wacziarg and We lch (2003). They found that countries with an open trad e policy have increased significan tly from 15.6 % to 73 % of all countries in the world during 1960 to 2000. Additionally, we examined a second dimens ion of the globalization process by studying the effect of a reduction in trade costs. The invention of containeri zation technology in the shipping industry has standardized and sharply d ecreased transportation co sts all over the world. Moreover, email and internet communication re duces the cost of communication in most business transactions. As globalization beco mes prevalent, trade costs which include transportation costs, tariffs, language barriers costs, marketing cost etc. have decreased

PAGE 34

34 substantially. The following proposition summarizes the effects of various dimensions of globalization in which this model provided: Proposition 2-1. Globalization, viewed as a permanent decrease in trade cost () (i) worsens the long-run wage-income distribution between the North and the South by raising the relative wage of Northern workers ) ( if and only if the population size of the South is greater or equal to that of the North ) (N SL L (ii) has an ambiguous effect on the relative wage of Northern workers ?) ( if the North population is greater than those in the South ) (N SL L (iii) has an ambiguous effect on the rate of tec hnology transfer from the North to the South ?) ( M (iv) does not affect the long-run rates of innovation ) ( A and Schumpeterian growth ) ( Ug Proof. See Algebraic Details A long-run decrease in trade costs has di fferent effects depending on the size of the population in each region. Proposition 2-1 (i) tends to resemble the real world situation where most of developing nations, such as China a nd India, have more population than developed countries. The size of the populatio n can capture not only the number of people but also the size of the market in each region. The economic intuiti on behind this proposition is that as trade costs decrease, Northern quality leaders receive more profit from selling the-state-of-the-art products to the South and demand more labor which leads to an increase in the wage rate in the North. On the other hand, Southern quality leaders receive more profit from selling generic products to the North but become less profitable in the South due to a decrease in the price of generic products. Given that there is more population in the South, the profit of Southern quality leaders would decrease. Therefore, a decrease in trade costs wo uld lead to an increase in North–South wage gap. However, when there is more population in the North, Northern quality leaders and Southern quality leaders both beco me more profitable; therefore, the effect on the North-South

PAGE 35

35 wage gap is ambiguous. In addition, the effect of trade costs to the rate of imitation is also ambiguous since a decrease in trade cost could re sult in either an increas e or a decrease in the profit of a Southern quality leader In the latter case, Southern quality leaders have less incentive to do more imitative R&D activities. Proposition 2-2. Globalization, viewed as a permanen t expansion in the size of the South ) ( SL (i) has an ambiguous effect on the long run wa ge-income distribution between North and South ?) ( (ii) has an ambiguous effect on the rate of t echnology transfer from North to South?) ( M (iii) does not affect the long-run rates of innovation ) ( A and Schumpeterian growth ) ( Ug Proof. See Equation 2-43 and Algebraic Details As population in the South increases, demand for both generic and th e-state-of-the-art products increase. The effects on the demand for la bor and the wage rate in each region depend on all parameters in the model especially, the value of trade costs, the parameter of innovation and the size of population in both regions. Theref ore, an increase in the size of developing countries has an ambiguous effect on the North-S outh wage gap and the rate of imitation. An expansion in the size of the South does not necess arily worsen the world income distribution or enhance the rate of imitation as ha s been found in previous studies. Proposition 2-3. A permanent increase in the global patent protection generated by an increase in the patent length ) ( T (i) permanently raises the rate of tec hnology transfer from North to South ) ( M if the following sufficient condition holds: 1 L L LS N.

PAGE 36

36 (ii) permanently increases the wage-income inequality between North and South ) ( if the following sufficient condition holds: 1 1 1 11 1 1 1 Tn T n Proof. See Algebraic Details The effect of an increase in patent lengt h and the R&D subsidy remains robust to the introduction of trade costs. The economic intuiti on of the Proposition 2-3 is that longer patent protection shifts resource away from the i nnovative R&D sector and manufacturing to the imitative R&D sector. This resource allocation re sults in a permanent increase in the rate of global imitation M Moreover, longer patent protection increases the duration that Northern quality leader enjoys the global monopoly profit and increases the risk of default for the Southern quality leader which leads to an incr ease in wage-income inequality between North and South. Proposition 2-4. The effect of a change in the subsidy to innovative R&D and imitative R&D can be summarized as follow (i) A permanent increase in th e innovative R&D subsidy ) ( Aworsens wage-income inequality) ( and raises the rate of imitation) ( M (ii) A permanent increase in the imitative R&D subsidy) ( M decreases the North-South wage gap ) ( and does not affect the rate of imitation ) ( M Proof. See Equation 2-35 and Equation 2-38 The long-run North-South wage gap is increasin g in factors that enhance the process of innovation and decreasing in parameters that enco urage the transfer of technology from North to South. The subsidy to imitative R&D activities does not affect the long-run values of the set of industries which are protected by patent, pv and the risk of default of a Southern quality leader, Therefore, it has no effect on the long -run rate of imitation in this model.

PAGE 37

37 Conclusion In this chapter, we develop a North-South m odel with global patent protection, endogenous growth and product-cycle trade in the presence of trade costs. The model was used to analyze the effects of globalization measured by a reduction in trade costs (cau sed by trade liberalization or technological advances in tr ansportation and communication) and a geographic expansion of developing countries. A reduction in trade costs worsens the wa ge-income distribution between regions. Trade liberalization has an ambiguous eff ect on the steady state rate of imitation and has no effect on either innovation or the growth rate. The effect of an increase in the Southern population is inconclusive in the presence of trade costs. Algebraic Details We calculated the steady-state value of No rth-South wage gap by using innovative R&D condition (Equation 2-20) and solving for pe r-capita global consumption expenditure L L L L e n L w cS N T n A N 1 1 ) )( 1 () (. (2-44) Then we used imitative R&D condition (Equati on 2-26) to solve for per-capita global consumption expenditure L L L L n w cS N S M 1 1 1 (2-45) We equated the per-capita global consumpti on expenditure c from Equation 2-44 and 2-45 and solved for the steady-state va lue of North-South wage gap S N S N S N S N A T n ML L L L L L L L n e n L 1 ) ( 1 1 ) ( 1 ˆ) (. (2-46)

PAGE 38

38 Next, we performed comparative static for each variable in the model. First we differentiated the steady-state va lue of North-South wage gap ˆ (Equation 2-46) with respect to the productivity of labor in innovative R&D activity 0 1 1 ) ( ) ( 1 1 ˆ) ( S N S N T n A ML L L L e n n L. (2-47) Then, we differentiated the steady-st ate value of North-South wage gap ˆ (Equation 2-46) with respect to the subsidy to innovative R&D activities A 0 1 1 ) ( ) ( 1 1 ˆ) ( 2 S N S N T n A M AL L L L e n n L. (2-48) Lastly, we differentiated the steady-st ate value of North-South wage gap ˆ (Equation 246) with respect to the magnitude of innovations 0 1 ) ( ) ( 1 1 ˆ) ( 2 2 S N T n A ML L e n n L. (2-49) We can see that the steady-state value of North-South wage gap ˆ is increasing in the productivity of labor in innovative R&D activity the subsidy to i nnovative R&D activitiesA and the magnitude of innovations On the other hand, the stead y-state value of North-South wage gap ˆ is decreasing in the productivity of labor in imitative R&D activities and the subsidy to imitative R&D activities M To show this we differentia te the steady-state value of North-South wage gap ˆ (Equation 2-46) with respect to the productivity of labor in imitative R&D activities 0 1 1 ) ( ) ( 1 1 ˆ) ( 2 S N S N T n A ML L L L e n n L. (2-50)

PAGE 39

39 Then, we differentiated the steady-st ate value of North-South wage gap ˆ (Equation 2-46) with respect to the subsidy to imitative R&D activities M 0 1 ) ( ) ( 1 1 ˆ) ( S N S N A T n ML L L L n n L e. (2-51) Next, we showed the calculation of the steadystate value of global per-capita consumption expenditure c ˆ.We solved for the North-South wage gap from innovative R&D condition (Equation 2-20) ) 1 )( ( 1 1 1A S N T nn L L e c (2-52) Using imitative R&D condition (Equation 2-26) to solve for the North-South wage gap S N M S NL L c n L L L ) 1 ( 1 1. (2-53) We equated the North-South wage gap from Equation 2-52 and 2-53 and solve for the steady-state value of per-capita global consumption expenditure ) ( ) 1 ( ) ( 1 1 1 ) 1 )( ( ˆS N M S N S N S N T n AL L L n L L L L L L e n c .(2-54) Proof of Proposition 2-1 (i) and (ii). By differentiate Equation 2-35 with respect to trade costs, we have the following equation 2 2 2 2) )( 1 ( ˆ S N S N N S NL L L L k L k L L k where 0 1 ) ( ) ( 1 1) ( T n A Me n n L k

PAGE 40

40 The sign of ˆ depends on the size of labor in both re gions. If the initial population in the South is greater than or e qual to that in the North N SL L then ˆis negative. However, if the initial population in the South is less than that in the North N SL L then ˆcan be both negative or positive. Proof of Proposition 2-1 (iii). By differentiate Equation 2-38 with respect to trade costs we can see that Mhas an ambiguous sign 1 1 1 1 2 2 2 1 1 ) (1 1 1 ) 1 ( 1 ) 1 ( 1 1 1 ( ) 1 )( ( Tn Tn L L L L L L L L L L Tn e n MS N S N S S N S T n A Proof of Proposition 2-1 (iv). By differentiate Equation 2-33 and Equation 2-43 with respect to trade costs 0 A and 0 Ug, We see that both variables are not affected by trade costs Proof of Proposition 2-2 (i). Define 0 ) ( 1 ) ( 1 1) ( n e n zT n A M the longrun Northern relative wage ˆ can be written as

PAGE 41

41 S N S N S N S N S NL L L L L L L L L L z 1 ) ( ˆ Differentiate the long-run Northern relative wage ˆ with respect to the Southern population 2 2 2 2 2 2 2) ( ) 1 ( ) ( 2 ) ( ) 2 ( ˆ S N N S N S S N N SL L L L L L L L L z L To determine the sign of SL ˆ the denominators of both terms are positive while, the numerator in the square br acket has ambiguous sign. 2 2 2 2) ( 2 ) ( ) 2 (S S N NL L L L ? + + The numerator of the second term is negative ) 1 (2NL<0. Given that z is positive, the sign of SL ˆ is ambiguous Proof of Proposition 2-2 (ii). We can see that the sign of SL M can not be determined by differentiate Equation 2-38 with respect to the Southern population SL 1 1 1 1 2 2 1 1 ) ( 1 2 1 1 11 1 1 ) 1 ( 1 1 ) 1 ( 1 ( 1 ) 1 ( ) 1 )( ( Tn n L L L L L L L L L L L n e n L T n L MS N S N S N S N T n A S

PAGE 42

42 Proof of Proposition 2-3 (i). Differentiating Equations 2-38 with respect to patent length T, we can see that T M is positive if 1 L L LS N. 1 1 ) 1 ( ) 1 ( ) 1 ( ) ( 1 ) 1 ( ) 1 ( ) 1 )( ( 1 1 1 11 1 2 ) ( 2 ) ( ) ( 1 1 1 1 1 2 1 1 1L L L Tn L L L L L e n e L L e n L L L n T L T n T MS N S N S N T n A T n S N T n A S N Proof of Proposition 2-3 (iii). For simplicity of the calculation define S N S N A ML L L L n L K 1 ) ( 1 1 and differentiate Equation 2-35 with respect to patent length 1 21 1 1 1 1 1 1 1 ) 1 1 )( ( 1 ˆ1 1 2 1 1 1 1 1 2 ) ( 1 1 1 ) ( 1 ) (T n Tn T Tn T e n Tn T n e e K TT n T n T n T ˆ is positive if 1 1 1 11 1 1 1 Tn T n

PAGE 43

43 Figure 2-1. Pricing structure of the Northern quality leaders Figure 2-2. Pricing st ructure of the Southe rn quality leaders South Leader sells domestically N Sw p charges N Sw p to drives out North Followers produce generic product North Leader charges N Nw p to drive out North Follower South Leader imitates j1 product charges N Nw p to drive out

PAGE 44

44 CHAPTER 3 PATENT ENFORCEMENT POLICIES AND ENDOGENOUS GROWTH Introduction The protection of intellectual property rights (IPRs) is one of the most debating issues in the international economic scene. Various argume nts in favor and against stronger IPRs have emerged as many believe that General Agreem ent on Trade-Related Aspects of Intellectual Property Right (TRIPs) is a rent-transfer mech anism from developing co untries to the more powerful developed nations. As each country differs in its economic fundamentals, the implementation of TRIPs poses an imbalance in social and economic development among rich and poor countries. In addition, stronger enforc ement could restrict diffusion of knowledge and competition and resulted in a higher product price. On the other hand, strengthening enforcement of IPRs, not only improves the business and invest ment climate, but also boosts incentives for domestic innovation and technology transfer to developing countri es. Moreover, the enforcement of IPRs serves as a remedy to a market failure for the growing knowledge-based market and reduces transaction cost that might arise from information asymmetries. Consumers have more choices in product variety and quality. The diffusion of inform ation and technology would lead to an improvement in labor productivity and enhance economic growth. Balancing these dynamic gains and costs that arise from strengthening IPRs is a challenging task for policy makers. The signing of TRIPs required member nations of World Trade Organization (WTO) to conform to a se t of minimum standards in protecting and enforcing IPRs in their countries. Each governme nt needs to implement various policies i.e. enforcement effectiveness, scope of protection, length of patent, trademark and copy right, etc., while allocates scare resources toward the patent enforcement sector i.e. training of enforcement officer, lawyers, judges and setti ng up monitoring system, legal fr amework, etc. Extensive works

PAGE 45

45 have been conducted to answer questions like who will gain and who will lose from the strengthening IPRs protection? Is the harmonization of the standa rd and enforcement of IPRs a necessary or sufficient condition for increasing global welfare and economic growth? Does IPRs protection encourage innovation an d R&D investment? What determine the incentive for patent protection? In the second chapter, we deve loped a simple dynamic closed-economy model to examine the effect of various factors on the resour ces used in patent enforcement activities which is represented by the probability of patent enforcement. Various studies have examined the effects of patent protection on the income distribution, innovation, imitation and economic growth. Help man (1993) developed a general-equilibrium model of an innovative North and an imitative S outh. He concluded that an increase in IPRs protection harms the South because of the change in the term of trad e and a reallocation of resource toward Northern products while the No rth might not necessary gain many benefits due to an increase in product pri ce. Glass and Saggi (2002), bui lt a product-cycle model of endogenous innovation, imitation an d foreign direct investment (FDI), and found similar negative results, namely that stronger IPRs in th e South reduces innovation, imitation, and FDI. Park (2002), using OEDC data on 21 countries, showed that pate nt protection and enforcement stimulates private R&D. Also, Dinopoulos and Kottaridi (2006) us ed a North-South model with exogenous patent enforcement and found that a move towards harmonization by the South accelerates the long-run rates of innovation a nd growth, improves the global wage-income distribution, but has an ambiguous effect on the rate of inte rnational technology transfer. In the presence of harmonized patent policies, strict er global patent enfor cement increases long-run global growth, accelerates the rate of international technology tran sfer and has no impact on the global income distribution.

PAGE 46

46 The relationship between IPRs protecti on and economic development is indeed complicated. Ginarte and Park (199 7) constructed the index of pa tent rights and found that more developed countries tend to pr ovide stronger protecti on of intellectual property. He concluded that the level of Research and Development (R&D) activities, market environment and international integration are significant factors in determining the protectio n level. Grossman and Lai (2004), using a North-South fr amework and exogenous patent en forcement, concluded that a country with a larger market for innovative R&D, higher human capital endowments and greater capacity to conduct R&D offers st ronger IPRs protection while pate nt protection is weaker if a country is close to inte rnational trade. This paper added to the literature on in tellectual property protection by introducing a resource-using e ndogenously determined patentenforcement mechanism and therefore provides a novel link between patent length and the degree of patent enforcement. Closed-Economy Model In this chapter, we developed a closed -economy model with an exogenous rate of population growth. The model is based on the quality-ladder framewor k where the quality leaders invent new products and receive a finite-length patent with some probability of patent enforcement. This paper contributed to the exis ting literature on growth and intellectual property protection by introducing resource-using a nd thus endogenous patent enforcement and by studying the relationship between patent enforcement and the long run rates of innovation and economic growth. Household Sector The demand side of the economy is generated by dynastic households w ith infinitely lived members. Each household member is endowed with one unit of labor which is supplied inelastically to the market. The size of each hous ehold grows exponentially at the rate of n > 0,

PAGE 47

47 where new household members are born continua lly. We normalized the initial size of each household to unity for simplification; therefore, the number of household members at time t is nte. Let nte L t L ) ( denote the level of population and th e supply of labor at time t, where L is the initial leve l of population. There is a continuum of industries indexed by 1 0 Each industry produces a final consumption good of different quality levels wh ich are indexed by j, where j represents the number of innovations in each industry. Let ) ( t j denote the quality increment generated by each innovation in industry where1 captures the size of each innovation. Each household maximizes the follo wing discounted lifetime utility 0 ) () ( lndt t u e Ut n, (3-1) where n is the constant su bjective discount rate. The instantaneous per-capita utility function at time t is defined by 1 0) ( ln ) ( ln d t j q t uj j, (3-2) where ) ( t j q denotes the quantity demanded per person of a product in industry with quality level j at time t. Equation 3-2 also implies that all else equal, consumers prefer higher quality products to lower qual ity ones. Consumers choose their consumption to maximize their discounted lifetime utility. The consumer maximization problem can be decomposed into the following steps: first, consumers choose to cons ume the product with the lowest quality-adjusted price j jt p ) ( in each industry. Then, consumers alloca te their budgets across all industries by solving the across-industry static optimization problem. The resu lt is the following unit elastic

PAGE 48

48 demand function ) ( ) ( ) (t p t c t q where () ctis each consumer’s consumption expenditure function at time t. Lastly, consumers solve th e dynamic optimization pr oblem as to maximize their discounted life time utility subject to their intertemporal budget constraint; dt d t p t c et j t n t c 0 1 0 ) ( ) ( ) () ( ln ln ) ( ln max (3-3) subject to ) ( ) ( ) ( ) ( ) ( ) (t nz t c t z t r t w t z where z(t) is the level of consumer assets at time t, w(t) is the wage rate at time t, and r(t) is the market interest rate at time t. Solving the dynamic optimization problem yield the following differential equation ) ( ) ( ) (t r t c t c (3-4) The market interest rate equals the constant subjective discount rate since per-capita consumption expenditure is constant at the steady-state equilibrium. Domestic Production and Patent Enforcement Sector Labor is the only factor of production and is perfectly mobile within a country. We assumed that the labor market is perfectly comp etitive and one unit of la bor produces one unit of output independently of its quality level. Therefore, each industry has a constant marginal cost equals to the wage rate. The model followed the quality-ladder growth framework by assuming Bertrand price competition. A firm that discovers the-state-of-the-art product becomes a quality leader and receives a finite patent length T > 0, with the probabi lity of patent enforcement represent by ) 1 0 ( Define L LE where EL is the amount of labor employed in patent enforcement activities and 0 is a parameter that captures and productivi ty of enforcement activities. Variable EL

PAGE 49

49 represents resources used in patent enforcement activities such as training of the enforcement officers, lawyers, judges and examiners etc., disciplining infringement, establishing legal framework and related court procedures, seizur e and destruction of counterfeit goods, setting up responsible agency, office and inst itutions. We can also interpret as an effectiveness of patent enforcement. In addition, we imposed that EL L to guarantee that the probability of patent enforcement is not greater than one. After a patent expires, products become gene ric and sell competitively. A quality leader charges w pj to drive out producers of generic produc ts through limit pricing. However, if a patent is not enforced, with a probability of 1, the method of production becomes general knowledge and quality followers imitate a product and sell competitively at w pj. There is no imitative R&D in this model since the quality followers can produce a product whenever the production method becomes general knowledge. Quality followers receive zero economic profit. The profit flow of the quality leader can be described by the following equation ) ( ) 1 )( ( ) (t cL t t (3-5) The profit flow is increasing in the probability or effectiveness of patent enforcement and the quality incremental which is generated by each innovation. Innovation Process The basic assumption of the innovation technol ogy is adopted from Dinopoulos et al. (2005). Let ) ( t xe capture the R&D difficulty at the long run equilibrium where is a parameter for innovative R&D productivity and 0 is a parameter for R&D difficulty. A quality leader hires i units of workers for innova tive R&D activities during time interval dt and produces

PAGE 50

50 ) ( t x i ie dt dA units of new products. Define i idA dA as the aggregate flow of new products and i i AL as the aggregate labor in the innova tive R&D activities. We can write the economy wide rate of patents as ) ( t x Ae dt L dA. The long-run innovation ra te can be written as ) () ( ) (t x Ae t L t A, where dt t dA t A) ( ) ( is the steady-state instanta neous flow of new products per industry. Define ) ( ) ( ( ) (t A t v t xp as the steady-state evolution of) (t x, where 1 ) ( 0 t vp is the measure of industries with active patents. The parameter (1,1) captures the correlation between the patent length and Schumpeterian gr owth. In the steady-state equilibrium, the measure of industries protected by patents ) (t vp and the flow of patents ) (t A are bounded and must be constant over time in order to have a bounded per-capita l ong-run growth rate. The steady-state value of R& D difficulty is given by t A v t xp) ( ) (. We can re-write the long-run innovation rate as ) () ( ) ( ) ( ) (t x Ae t L t L t L t A The term in square brackets is the share of innovative R&D workers whic h is constant in the st eady-state equilibrium. )) ( ( ) () (t x tn t xe L e t L is also constant over time since ) (t A is constant over time. Therefore, the steady-state rate of new pr oducts can be written as pv n A (3-6)

PAGE 51

51 The steady-state rate of ne w products is increasing in population growth rate n but decreasing in the R&D difficulty parameter The relationship between the innovation rate and the measure of industries with active patents pv depends on the value of parameter Let ) (t VA denote the market value of a patent at time t in industry that can be written as T s t r N Ads e s t t V0 ) () ( ) ( (3-7) The value of a patent is identical across i ndustries as we assume structural symmetry. Substituting the profit function of a quality leader from Equation 3-5 and integrating Equation 37 yields the steady-state ma rket value of a patent n e t cL t t VT n A ) (1 ) ( 1 ) ( ) (. (3-8) At the steady-state equilibrium, the value of a typical patent is increasing in the patent length T, the quality increment the population growth rate n and the probability of patent enforcement. The value of a patent is inversely related to the subjective discount rate For simplicity, define n e TT n ) (1 ) ( to capture the effect of pa tent length and the effective discount rate on the value of the patent. In order to derive an equilibrium condition, we first considered the innovative R&D sector. The market value of any innovative R&D activities can be written as ) (t x i A i Ae dt V dA V The cost of innovation is dt wi A) 1 ( where 0A is an ad-volarem subsidy to R&D innovation. The discounted net profits in the R&D sector can be written as dt w e Vi A t x A) 1 () ( We

PAGE 52

52 assumed free entry into innovativ e R&D activities which leads to a zero profit condition in this sector. The following equation provides the cond ition that the marginal product of labor in innovative R&D equals the subsidyadjusted wage rate of labor. w e VA t x A) 1 () ( (3-9) To find the closed economy innovative R&D condition, we substitute the steady-state value of a patent from Equation 3-8 w T L cA) 1 ( ) ( 1 (3-10) The innovative R&D condition shows a nega tive relationship between per-capita consumption expenditure and the probability of patent enforcement. The intuition behind this condition could be that as the effectiveness of patent enforcement increases, counterfeit good is substantially reduced while, the price of product increases Consumer has to reduce their consumption. Domestic Labor Market The demand for labor comes from four activities which include innovative R&D AL, patent enforcement EL, and manufacturing of the-state-of-t he-art product and generic products. The demand for innovative R&D labor can be deri ved from substituting the steady-state value of R&D difficulty into the long-r un innovative rate which yields the demand for innovative R&D labor as ) () (pv A t Ae A t L Each quality leader produces ) ( ) (t L w t cunits of new products. The demand for labor in manufacturing new product equals ) ( ) (t L w t c vp. The demand for labor in producing generic products is ) ( ) (t L w t c vC, where Cv is a measure of industries producing

PAGE 53

53 generics product. This assumptions implies that 1 C pv v. Setting aggregate demand equal to aggregate supply for labor, we derive the fullemployment condition as ) ( ) ( ) ( ) 1 ( ) ( ) ( ) () (t L t L w t c v t L w t c v e A t LE p p v A tp (3-11) Substituting the steady-state rate of innovation pv n A and dividing every term by L(t) gives us the per-capita full-employment condition ) ( ) ( ) ( ) ( ) ( ) ( 1t L t L w t c v w t c w t c v v L nE p p p (3-12) Steady-State Equilibrium In the steady-state equilibrium, the measure of industries with an active patent depends not only on patent length but also the pr obability of patent enforcement. T A ds A vT p 0 (3-13) Substituting the steady-state rate of new products the steady-state solution for the measure of industries with active pa tents can be written as 1 1nT vp. (3-14) We imposed the parameter restriction nT to ensure that the measure of industries with patents protection is less than unity. This restriction holds for large values of parameter According to Equation 3-14, the measure of indust ries with a quality lead er increases with the population growth rate n, patent length T and the probability or strength of patent enforcement. It is inversely related to the R&D difficulty parameter We now rewrite the steady-state solution for the ra te of innovation or the flow of patent as

PAGE 54

54 ) 1 ( ) 1 ( 1 T n A. (3-15) The long-run innovation rate is increasing in the rate of popul ation growth n but decreasing in R&D difficulty parameter patent length T, and enforcement probability. This result based on the assumption that 0 where patents reduce the flow of spillovers knowledge and create more difficulty to innovative R&D activities. To solve for the steady-state equilibrium solu tion, we normalized the wage rate equal to unity. Substituting the steady-state solution of the measure of industries with patents from Equation 3-14 and using the definition of the probabi lity of patent enforcement, we can rewrite the per-capita full-employment condition as c c nT L T n1 11 11 1 1. (3-16) Performing computer simulations by using va lue of parameters similarly to Dinopoulos and Segerstrom (1999) and Sener (2006), we find that there is a negati ve relationship between per-capita consumption and the prob ability of patent enforcement. This relationship is based on the per-capita full-employment condition (Equa tion 3-16). We can plot the innovativeR&D condition (Equation 3-10) and the per-capita full -employment condition (Equation 3-16) in order to solve for both the per-capit al consumption expenditure and the probability of patent enforcement as in Figure 3-1. The equilibrium now depends on all parameters in the model including those which are re lated to policy changes. Long-Run Schumpeterian Growth To derive the long-run Schumpeterian growth, we consider the long-run growth rate of each consumer’s utility function. At each instant in time, there are pv industries with a quality

PAGE 55

55 leader. The average number of innovations in each of these industries is ) ( ) (t A t j where) (t Adenotes the economy-wide number of innovations at time t. The quantity produced by each quality leader equals ) ( ) (t L w t c while each quality follower produces ) ( ) (t L w t c. Thus, the instantaneous utility of a typical household member at time t is pcvv t A t Ad w c d w c t u ) ( ) (ln ln ) ( ln. (3-17) Integrating Equation 3-17 yields the level of the instantaneous utility at time t for a typical consumer w c v w c v t A t uc pln ) ( ln ln ) ( ) ( ln (3-18) At the steady-state equilibrium, all variables on the right-hand side are constant over time, except for the number of innovationst A t A) (. Differentiating the level of the instantaneous utility with respect to time and substituti ng the steady-state flow of patents yields ln ln) 1 ( ) 1 ( 1 T n A u u gU (3-19) The long-run Schumpeterian growth now depends on all parameters in the model. Growth is proportional to th e rate of innovationA. More importantly, the rate of innovation depends on both patent length and the probability of pa tent enforcement which are governed by the parameter(1,1) Parameter captures the structure of knowledge spillovers. For example; if patents decrease knowledge spillovers, that is if) 1 0 ( ; then an increase in patent length decreases long-run Schumpeteria n growth. In addition, long-r un Schumpeterian growth is increasing in the rate of population growth a nd the size of innovation but decreasing in the parameter of R&D difficulty. These results are similar to Di nopoulos et al. (2005).

PAGE 56

56Comparative Steady-State Analysis Using computer-simulation analysis, we perfor med various comparative static exercises to examine the effects of several parameters. The following proposition summarizes the main results Proposition 3-1. An increase in patent length increases the probability of patent enforcement. This result provides an important link between the patent length and patent enforcement which has not been done in the previous literatur e. Most of previous literatures modeled the probability of patent enforcement as an exogenous parameter or as a set of a policy choice from a government. Using the definition of patent enforcem ent, we can see that an increase in patent length will lead to an increase in per-capita resources devoted to patent enforcement activities. An increase in patent length shifts up the full-employment curve while shifts down the innovative R&D curve in Figure 3-1 and incr eases the probability of enforcement. Proposition 3-2. An economy experiencing larger innovations, measured by parameter or offering higher innovative-R&D subsidies aT, engages in stricter patent enforcement. An increase in both the quality incremental parameter and the subsidy to R&D sector aT shift up the full-employment curve and shift down the innovative R& D curve in Figure 3-1. This leads to an increase in the probability of patent enforcement. This result also conforms to the patent rights index constructe d by Ginart and Park (1997, 2002). Means of indexes of patent right are higher among developed countries than those of devel oping countries. This result is consistent with the results obtai ned by Grossman and Lai (2004). Proposition 3-3. A country with the larger market size or population has a stricter patent enforcement policy.

PAGE 57

57 Using Figure 3-1, an increase in population shifts up the full-employment condition and shifts down the innovative R&D curve which leads to a higher value of the probability of patent enforcement. This result is also consistent with Grossman and Lai (2004) who found that a higher relative endowment of human capital leads to an increase in th e relative incentive to protect IPRs; moreover, a larger market fo r innovative product enhances a government’s incentive to grant stronger patent rights. The intuition behind this proposition is that as a country becomes larger, a government might be able to allocate more resources toward patent enforcement sector. Proposition 3-4. An increase in the innovative R&D difficulty parameter leads to a decrease in patent enforcement. An increase in the innovative R&D difficulty shifts down the full-employment condition curve, while the innovative R&D condition remains unchanged. This results in a decrease in the strength or the probability of pa tent enforcement. The intuition is that as products become harder to discover and produce, resources are devoted more to innovative R&D sector. A reduction in the resources used in the enforcement sector directly affects the e ffectiveness of patent enforcement. Proposition 3-5. An increase in the strength of patent enforcement (i) accelerates economic growth if patent increases knowledge diffusion in the economy ) 0 1 ( (ii) decelerates economic growth if patent decrease knowledge diffusion in the economy ) 1 0 ( The effect of an increase in patent protecti on to economic growth depends entirely on the characteristic of patent process. As some views that stronger IP Rs might restrict the access to new information and technology while others argues that the knowledge from patent application

PAGE 58

58 encourages further innovation of new products an d an increase in averag e quality of product in the market. Conclusion In this chapter, we developed a simple cl osed-economy model us ing the quality ladder framework. The model generated endogenous Sc humpeterian growth a nd also provides an endogenous link between the patent length and the probability of patent enforcement. The novel result is that as the patent length increases, the probability of patent enforcement also increases. Our finding is consistent with the previous lite rature in that a count ry with more advanced technology or with a larger market tends to have higher probability of patent enforcement. On the other hand, we found that the higher the di fficulty in innovative R&D activity, the less the probability or strength of patent enforcement will be. Various dimensions in this model can be developed to answer additional question related to IPRs. It might be interesting to differentiate wage and skill level of labor in different sect ors and also to explore more on the government budget constraint to finance the expens e in the patent enforcement sector

PAGE 59

59 Figure 3-1. Closed-economy’s steady-state equilibrium 0 c 1 Full-employment condition Innovative R&D condition

PAGE 60

60 CHAPTER 4 MULTINATIONAL CORPORATIONS, PATENT ENFORCEMENT AND ENDOGENOUS GROWTH Introduction A wide range of studies have examined the e ffects of stronger intelle ctual property rights (IPRs) protection in developing co untries as all WTO (World Trade Organization) members are required to strengthen IPRs protection since th e Uruguay round of multilat eral trade negotiations in 1994. Helpman (1993) concluded that a stronger IPRs protecti on hurts the Sout h but benefits the North, and increases the fraction of products that are produced by mul tinational corporations (MNCs). These results are based on assumptions of a low imitation rate, factor price equalization and a similar risk of product imitation in all t ype of firms. Lai (1998), assuming infinite life patents and a higher risk of product imitation for MNCs, examined different methods of production transfer and the effects of the strengt hening of IPRs protection. He emphasized an important of foreign direct investment (FDI) by showing that if FDI is the main channel of production transfer, stronger IPRs protection incr eases the rate of pr oduct innovation, production transfer and improves income distribution be tween regions. In his model, the rate of multinationalization is based on optimization of Northern firms. FDI has been the largest intern ational capital inflow to deve loping countries in the past decade. The tremendous increase in FDI, fr om $22 billion to $325 billion during 1990 to 2006 (World Bank 2007), provides additional financial resource to developing countries for achieving higher level of economic growth and improving th eir living standards. Be nefits and drawbacks from FDI vary and depend on various factors in cluding the type of inve stment, the level of technology, and the pattern of knowledge diffusion as well as policies and institutions framework in the recipient countries.

PAGE 61

61 Many studies have used a Nort h-South product cycle trade model to examine the effects of stronger patent enforcement to FDI. Glass and Saggi (2002) found that st ronger Southern IPRs protection reduces both FDI and innovation. The main assumption behind their result is that stronger IPRs protection in the S outh does not alter the expected profit stream of MNCs relative to that of Northern firms. Br anstetter et al. (2007) assumed positive knowledge spillovers and a reduction in the costs of innovation and imitation ove rtime. They concluded that IPRs reform in the South increases FDI and the rate of innovation, decreases imitation rate and improves the income distribution between regions. These works have examined the effect of stronger IPRs protection through the change in the cost of imitation and provide d indirect link between IPRs protection and FDI The purpose of this paper is to analyze the e ffects of a change in IPRs protection policy, globalization, and innovation t echnology on FDI and income dist ribution between the North and the South. Our model adopted the same assump tion of different risks of product imitation among firms as in Lai (1998) and Branstetter et al. ( 2007). The expected discounted profit of MNCs is directly affected by the change in the probability of patent enforcement in the South. In addition, we assumed negative knowledge spillovers from FDI and an increase in R&D difficulty overtime in order to remove the undesirable scale effect property. This paper cont ributed to the existing literature by providing a link betw een FDI and patent enforcemen t policy and explicitly studying the effects of a geographic expansion in the si ze of the South and an improvement in innovation process on FDI and income distribution between regions. Model In the third chapter, we developed a tw o regions model of No rth-South trade and Schumpeterian (R&D-based) growth with free trade. The model followed the quality-ladder framework where Northern quality leaders invent new products and receive fi nite patents that are

PAGE 62

62 perfectly enforceable in the Nort h but imperfectly enforceable in the South. Northern quality leaders have a choice to decide whether to beco me Multinational Corporation (MNC) in order to take advantage of lower labor cost by moving thei r production to the South or to remain in the North with lower probabili ty of product imitation. Consumers and Workers Each region consists of a fixed measure of dynastic households with infinitely lived members. Each household member is endowed with one unit of labor which is supplied inelastically to the market. The size of each hous ehold grows exponentially at the exogenous rate of 0 n, where new household members are born conti nually. We normalized the initial size of each household to unity for simplification; theref ore, the number of household members at time t equals nte. Let nt N Ne L t L ) ( denote the level of Northern popul ation and the supply of labor in the North at time t, where NL is the initial level of Northern population (households). Similarly, let nt S Se L t L ) ( denote the level of Southern population and the supply of labor in the South at time t where SL is the initial le vel of Southern population. Th e world population at time t is given by nt S N S N nte L L t L t L e L t L) ( ) ( ) ( ) ( The global economy consists of a continuum of industries indexed by 1 0 Each industry produces a final consumption good of diffe rent quality levels which are indexed by j, where j represents the number of innovations in each industry. Let ) ( t j denote the quality increment generated by each innovation in industry where parameter 1 captures the size of each innovation which, by assumption, is identical across industries. Each household maximizes the following discounted lifetime utility 0 ) () ( lndt t u e Ut n, (4-1)

PAGE 63

63 where n is the constant su bjective discount rate. The instantaneous per-capita utility function at time t is defined by 1 0) ( ln ) ( ln d t j q t uj j, (4-2) where ) ( t j q denotes the quantity demanded per person of a product in industry with quality level j at time t. Consumers prefer higher-quality pr oducts to lowerquality ones and choose their consumption to maximize their discount ed lifetime utility in three steps. First, consumers choose to consume the product w ith the lowest quality-adjusted price j jt p ) ( in each industry. Then, consumers allocate their budgets across al l industries by solving the across-industry static optimization problem. The result is the following unit elastic demand function ) ( ) ( ) (t p t c t q (4-3) where ()ct is each consumer’s consumption expe nditure function at time t. Lastly, consumers solve the dynamic optimization problem in order to maximize their discounted life time utility dt d t p t c et j t n t c 0 1 0 ) ( ) ( ) () ( ln ln ) ( ln max (4-4) subject to their intertemporal budget constraint ) ( ) ( ) ( ) ( ) ( ) (t nz t c t z t r t w t z where z(t), w(t) and r(t) is the level of consumer assets the wage rate and the market interest rate at time t, respectively. Solving the intertemporal problem yields the following differential equation ) ( ) ( ) (t r t c t c. (4-5)

PAGE 64

64 The market interest rate r equals the constant subjective discount rate as per-capita consumption expenditure c is constant in the steady-state equilibrium. Production and Multinationalization Labor is the only factor of production and perfectly mobile within a country. Labor markets are perfectly competitive. One unit of labor produces one unit of output for all quality levels of products. This assumption simplifies the model as each industry has a constant marginal cost equal to a wage rate. The model is base d on quality ladder framew ork and Bertrand price competition. A Northern firm becomes a Northern quality l eader when it discovers the new state-of-theart product and receives a finite patent length T > 0 which is pe rfectly enforceable only in the North and imperfectly enforceable in the South. The effectiveness of patent enforcement in the South depends on several factors including the strengt h of law, regulation, quality of institutions, resources devoted to enforcement activities, etc. These factors can be captured by the probability of enforcement which is represented by ) 1 0 ( A Northern quality leader has the following choice: if a Northern quality leader remains in the North, it faces a lo wer probability of product imitation. For simplicity, we assumed that the probability of imitation of a Northern-based firm is zero. Therefore, a Northern firm faces the risk of imitation only after it becomes a multinational company. A Northern quality leader can achieve a higher level of profit by moving its production to the South in or der to take advantage of a lowe r Southern wage; however, once a firm becomes a MNC, it faces a high er risk of imitation equal to 1. Define as the probability that a firm will become a MNC. The multi-nationalization process is depicted in Figure 4-1.

PAGE 65

65 A Northern-based firm, produc ing the-state-of-t he-art quality product j in industry charges N Nw p and uses a trigger price strategy to dr ive out of the market Northern quality followers and Southern imitators. After the pate nt expires, products become generic and sell competitively in the market. The profit flow of the Northern quality leader is ) )( ( ) (S S N N N N NL q L q w w t where Nq and Sq are per-capita quant ities demanded by Northern and Southern consumers respectively. Substituting the demand function from Equation 4-3 and the Northern quality leader ’s profit flow can be written as ) ( ) ( ) 1 ( ) (t L c t L c tS S N N N (4-6) MNCs face a higher risk of imitation than a No rthern-based firm. If the patent is not enforced in the South with a probability 1, a method of production becomes general knowledge in the South. There is no imitative R&D in this model since a production method become general knowledge in the South when there is no patents protection with the probability of 1. Southern quality followers produce the pr oduct and sell competitively in the South at price S Sw p On the other hand, with a prob ability of patent enforcement MNCs use a trigger price strategy to drive out Northern and Southern quality followers by setting the price equalN MNCw P Assuming no fixed cost for MNCs in the South except for production cost, the expected profit flow of MNCs can be derived similarly as that of a Northern quality leader where S S S N N N S N MNCL q w w L q w w t) ( ) ( ) ( Define 1 S Nw w as a North-South wage gap. Substituting the unit demand function from consumer maximization problem (Equation 4-3) the MNCs’ profit flow can be written as )) ( ) ( )( 1 1 ( ) (t L c t L c tS S N N MNC (4-7)

PAGE 66

66 The profit flow of MNCs increases in the proba bility of patent enforcement in the South the size of each innovation and the wage gap between the two regions Innovation This model adopted basic assumptions on the innovation technology from Dinopoulos et al. (2005) where innovation pro cess depends on the amount of la bor devoted to research and development (R&D) activity, the productivity and the difficulty of R&D. Let be an innovative R&D productivity parameter and let ) ( t xe capture the R&D difficulty, where 0 is a parameter. A Northern qua lity leader, who hires i units of workers for innovative R&D activities during a time interval dt, produces ) (t x i ie dt dA units of the-state-of-the-art products. Define i idA dA as the aggregate flow of new products and i i AL as the aggregate labor in innovative R&D. Then, the economy wi de rate of new products can be written as ) (t x Ae dt L dA. Define dt t dA t A) ( ) ( as the steady-state instantaneous flow of new products then, the long-run innovation rate can be written as ) () ( ) (t x Ae t L t A. (4-8) Define ) ( ) ( ) (t A t v t xp as the steady-state evolution of R&D difficulty) (t x, where 1 ) ( 0 t vp is the measure of industries with active patents. We assumed that patents have negative knowledge spillovers to innovation process. Patents reduce the flow of knowledge spillovers. A discovery of new product becomes more difficult as more patents is being issued or protected. The steady-state valu e of R&D difficulty is given by t A v t xp) (. In the steady-state equilibrium, the flow of patents ) (t A and the measure of industries with active patents pv is

PAGE 67

67 constant over time for a bounded per-capita long-r un growth rate. The long-run innovation rate can be rewritten as ) () ( ) ( ) ( ) (t x Ae t L t L t L t A The term in square brackets is the share of innovative R&D workers which is constant in the steady-st ate equilibrium. Moreover, )) ( ( ) () (t x tn t xe L e t L is constant overtime. Therefore, th e steady-state rate of new product can be written as pv n A (4-9) The innovation rate is increasi ng in the population growth ra te n but decreasing in the R&D difficulty parameter and the measure of industries with active patentspv. To derive the equilibrium condition in the innovative R&D sector, let ) (t VN denote the market value of a patent of a Northe rn-based firm at time t in industry which can be written as T s t r N Nds e s t t V0 ) () ( ) ( (4-10) The value of a patent is identical across i ndustries as we assume structural symmetry. Substituting the profit function of a Northern-bas ed firm from Equation 3-6 and integrating Equation 4-10 yields the steady-st ate market value of a patent for a Northern-based firm n e t L c t L c t VT n S S N N N ) (1 ) ( ) ( 1 ) (. (4-11) At the steady-state equilibrium, the value of a Northern-based firm’s patent is increasing in the patent length T, the quality increment and the population growth rate n. The value of a patent is inversely related to the subjective discount rate For notation purpose, we define

PAGE 68

68 n e TT n ) (1 ) ( to capture the effect of the patent leng th and the effective discount rate on the value of the patent. Similarly, we can derive ) (t VMNC as the market value of MNCs’ patent at time t in industry by substituting the profit fu nction of a MNC from Equati on 4-7 in Equation 4-10 and integrating it yields th e steady-state market value of a patent for a MNC1 n e t L c t L c t VT n S S N N MNC ) (1 ) ( ) ( 1 1 ) (. (4-12) At the steady-state equilibrium, the value of a MNC’s patent is increasing in the duration of patent T, the quality increment the population growth rate n a nd the probability of patent enforcement The value of a patent is inversely related to the subjective discount rate Next, we derive the zero profit condition in the innovative R&D sector. The market values of the innovative R&D activ ities can be written as ) (t x i A i Ae dt V dA V Define MNC N AV V V ) 1 ( as the expected market value of a patent for a Northern quality leader, where represents the probability th at a firm becomes a MNC. Th e cost of innovation equal to dt wi N A) 1 ( where 0A is an ad-volarem subsidy to R&D innovation. The discounted net profits in the R&D sector can be written as dt w e V Vi N A t x MNC N) 1 ( ) ) 1 (() ( The zero profit condition in this sector is a result of the assumption of free entry into innovative R&D 1 There are 2 ways to model international property rights enforcement and imitation. This paper models probability of patent enforcement with an instantaneous of time wh ere the probability ranges from 0-1. This method works well with a finite time of patent as we assume in this pape r. Another method models prob ability of imitation with an exponential distribution where the probability can range from 0. This method is preferred if the patent duration is infinite. See Lai (1998) for detail of the second methodology.

PAGE 69

69 activities. The following equati on provides the condition that the marginal product of labor in innovative R&D equals the subsidyadjusted wage rate of labor N A t x MNC Nw e V V) 1 ( ) 1 () ( (4-13) From N t x tn N t x NL e L e t L )) ( ( ) () ( and the same is hold for SL, we substitute the steadystate values of a patent for a Northern-based and a MNC from Equation 4-11 and Equation 4-12 into Equation 4-13 to establish the Innovative R&D condition N A S S N N S S N Nw L c L c L c L c T) 1 ( 1 1 1 ) ( (4-14) Labor Markets We assumed perfect labor mobility and full em ployment to prevail within each region. The demand for labor in the North comes from tw o activities which include innovative R&D and manufacturing of new products The demand for innovative R&D labor can be derived from substituting the steady-state value of R&D diffi culty into the long-run innovative rate which yields the demand for innovative R&D labor as ) () (pv A t Ae A t L. Northern quality leaders produce ) ( ) ( ) ( ) ( ) ( ) (t L t p t c t L t p t cS N S N N N = ) ( ) (t L w t cN units of new products, where L L c L c cS S N N/ ) ( is the per-capita global consump tion expenditure. Setting aggregate demand equal to aggregate supply of labor yields the Northern fullemployment condition N v A t Nw t L t c e A t Lp ) ( ) ( ) () ( (4-15) Substituting the steady-state rate of innovation pv n A and dividing every term by L(t) gives us the per-capita Northern full-employment condition

PAGE 70

70 N p Nw c L v n L L (4-16) Next, consider the Southern labor market where the aggregate demand for labor comes from two activities which include manufacturin g of MNCs’ products and manufacturing of generic products. Each MNC produces Nw t c t L) ( ) ( units of new products. There are pv industries in the South producing MNCs’ pr oduct; therefore, the demand for labor for manufacturing of MNCs’ product equals N pw t c t L v) ( ) ( Each Southern quality follower produces Sw t c t L) ( ) ( units of generic products. There are cv industries produce generic products in the South at each instant of time, where 1 c pv v. The demand for labor for manufacturing generic products is S cw t c t L v) ( ) (. The Southern full-employment condition can be derived by setting the aggregate demand for labor equal to the aggregate labor supply S c N p Sw t c t L v w t c t L v t L) ( ) ( ) ( ) ( ) ( (4-17) Divide the above equation by L(t) and substitute p cv v 1 yields the per-capita Southern full-employment condition, S P N p Sw c v w c v L L) 1 ( (4-18) Steady-State Equilibrium At the Steady-state equilibrium, a Northern qu ality leader should be indifferent between producing in the South as a MNC and producing in the North. Ther efore, the value of Northern-

PAGE 71

71 based firm’s patent and those of the MNCs should be equal, where MNC NV V We can use Equation 4-11 and Equati on 4-12 to derive the Multi-nationalization equilibrium as n e L c L c n e L c L cT n S S N N T n S S N N ) ( ) (1 1 1 1 1. (4-19) Simplifying Equation 4-19, we can solve for th e value of the North-South wage gap which prevail in the Multi-nationalization e quilibrium that can be written as ) ( 1 1S S N N S S N NL c L c L c L c (4-20) The Multi-nationalization equilibrium condition establishes the link between the relative wage and the probability of patent enforcement where an increase in the probability of patent enforcement leads to an improveme nt in the relative wage between North and South. In addition, the value of the North-South wage gap from Equa tion (4-20) is greater than unity. This result contrasts to the wage equalization equilibrium in Helpman (1993). To solve for the explicit steady-state solution of the NorthSouth wage gap, let the wage of Southern labor be a numeraire where1Sw, so that 1 Nw captures the North-South wage gap. The innovative R&D condition can be rewritten as ) 1 ( 1 1 1 ) (A S S N N S S N NL c L c L c L c T (4-21) Substituting the value of the North-South wage gap from Equation 4-20 into Equation 421, we can solve the North-South wage gap in term of the per-capita global consumption expenditure as ) 1 ( ) 1 )( (AL c T (4-22)

PAGE 72

72 To solve for the steady-state value of the gl obal per-capita consumpti on expenditure, first; we rewrite the per-capita Northern full-employ ment condition from Equation 4-16 and the percapita Southern full-employment condition from Equation 4-18 in term of the measure of industries with active patents pv, assuming the wage in the Southern as a numeraire. Then, we equate both full-employment conditions as 1 11c L L c L L L nS N. (4-23) Substitute the North-South wage gap from Equation 4-20 into Equation 4-23 and let cˆ denote the steady-state value of the per capita global consumption expe nditure which can be solved as n T L n L L T L L L cA N S A N S ) 1 )( ( ) 1 ( ) 1 )( ( ) 1 ( ˆ (4-24) Next, we solve for the steady-state value of the North-South wage gap by substitute the steady-state value of the per-c apita global consumption expenditure from Equation 4-24 into Equation 4-22 and let ˆ denote the steady-state value of th e North-South wage gap, we have n T L n L T L L TA N S A N S A) 1 )( ( ) 1 ( ) 1 )( ( ) 1 ( ) 1 ( ) 1 )( ( ˆ. (4-25) Lastly, to find the steady-state value of the measure of industr ies with active patents, we solve the per-capita Northern full-employment condition (Equation 4-16) and the per-capita Southern full-employment condition (Equation 4-18) in term of the North-South wage gap, then we equate both full-employment condition and substitute the steady-state value of the per-capita

PAGE 73

73 global consumption expenditure from Equation 4-24. Let pvˆ denote the steady-state value of the measure of industries with active patents that can be solved as n T L n L T L L L n n T L n L T L L L vA N S A N S N A N S A N S S p) 1 )( ( ) 1 ( ) 1 )( ( ) 1 ( ) 1 )( ( ) 1 ( ) 1 )( ( ) 1 ( ˆ. (4-26) Long-Run Schumpeterian Growth We use the long-run growth rate of each cons umer’s utility function to derive the long-run Schumpeterian growth. At each instant in time, there are pv industries with active patents and cv industries with inactive pa tents. The average number of innova tions in each of these industries equals ) ( ) (t A t j The quantity produced by each quality leader in the North or by each MNC in the South equals ) ( ) (t L t c. each quality follower in the South produces ) ( ) (t L t c. Quality followers in the South produce generic product in the competitive market and charge price equal to the unit cost of production. We can derive the instantaneous utility of a typical household member in the North at time t as pcvv N t A N t Ad c d c t u ) ( ) (ln ln ) ( ln. (4-27) Integrating Equation 4-27 yields the level of the instantaneous utility at time t for a typical Northern consumer N c N pc v c v t A t uln ln ln ) ( ) ( ln (4-28)

PAGE 74

74 The instantaneous utility of a typical household member in the South at time t is pcvv S t A S t Ad c d c t u ) ( ) (ln ln ) ( ln. (4-29) Integrating Equation 4-29 yields the level of instantaneous utility at time t for a Southern consumer S c S pc v c v t A t uln ln ln ) ( ) ( ln (4-30) In the steady-state equilibrium, all variable s on the right-hand side of the Equation 4-28 and Equation 4-30 are consta nt over time, except for the number of innovationst A t A) (. Differentiating the level of instantaneous utility with respect to time and using the steady-state flow of patents from Equation 4-9 yields ln ln p Uv n A u u g (4-31) The long-run growth rate is proportion to the rate of innovation which also depends on the measure of MNCs. As we assu med an increase in R&D difficulty overtime with an increase in the measure of industries with active patents, the measure of MNCs i nversely relates to the growth rate due to its effect to the innovation process. The lo ng-run Schumpeterian growth now depends on all parameters in the model as the measure of MNCs is determined within the model. The long-run Schumpeterian growth is increasing in the rate of population growth and the size of innovation but decreasing in the parameter of R&D difficulty. Comparative Steady-State Analysis We have solved the steady-state value for th e North-South wage gap, the per-capita global consumption expenditure and the measure of indu stries with active patents or the measure of MNCs. Next, we performed various comparativ e steady-state analyses using both algebraic

PAGE 75

75 calculation and computer simulation to examine th e effects of several parameters to the steadystate value of the North-South wage gap and the measure of MNCs. The following propositions summarize the main results Proposition 4-1. An increase in the strength of patent enforcement policy in the South modeled as an increase in the probability of patent enforcement policy ) ( does not affect the long-run level of Foreign Direct Investment and the long-run wa ge-income distribution between North and South. Proof See Equation 4-25 and 4-26. It is interesting that the probability of patent enforcement or the effectiveness of patent enforcement policy dose not matter to the decision of a firm to become MNCs at the steady-state equilibrium. One explanation is the steady-state value of the relative wage that equalizes the profit flow of the Northern-based firms and MNCs at the steady-state equilibrium. By construction of the model, the steady-state valu e of relative wage between North and South always adjusts it valued to equalize the profit flow between Northern-based firms at the steadystate equilibrium Proposition 4-2. A stronger intellectual property rights protection modeled as an increase in patent length ) ( T (i) reduces the flow of Foreign Direct Investment to the South as the measure of Multinational Corporations in the South decline ) ( pv (ii) worsens the long-run wage-income distribution between the North and the South by raising the relative wage of Northern workers ) ( Proof. See Equations 4-25 and 4-26. We provided a direct link betw een a patent length and a flow of FDI. These results are consistent with Glass and Saggi (2002) and Glass and Wu (2007) where they found that stronger

PAGE 76

76 IPRs protection reduces the flow of FDI but c ontrast with Lai (1998) and Branstetter et al. (2007). A longer duration of a patent length enab les quality leaders to enjoy longer period of monopoly profit. This might reduce an incentive for a Northern based firm to move their production based to the South region since they f aces higher risk of imitation and a reduction in profit when they become MNCs. As more industr ies remain in the North with an increase in patent length, the relative wage of Northern workers will increase as more demand of labor prevail in the region. This resu lt is consistent with Dinopoulos et al. (2005) who found that an increase in global patent length worsens the wa ge-income inequality between the North and the South. Proposition 4-3. Globalization, viewed as a permanent in crease in the size of the Southern population ) (SL (i) increases the flow of Foreign Direct Investment to the Sout h as the measure of industries with active patents in the South increase ) ( pv (ii) worsens the long-run wage-income distribution between the North and the South by raising the relative wage of Northern workers ) ( Proof. See Equations 4-25, 4-26 and Algebraic Details One view of globalization is a geographic expa nsion in the size of the South measured by the level of Southern population. An example of this view is the entering of China to WTO at the end of 2001 and the trend of an increase in th e openness to trade in developing countries around the world (Wacziarg and Welch 2003). Our finding contributed to the existing literature by adding the direct link between gl obalization and FDI. An increase in the size of the Southern market attracts more flows of FDI to the re gion as the demand for product increases. However, an increase in the level of population in the Sout h deteriorates the inco me distribution between regions as more supply of labor emerges in th e market and drives down the relative wage of

PAGE 77

77 Southern workers. Interestingly, the model predicts a complete opposite effect for a permanent increase in the level of the Northern population ) (NL. An expansion in the size of the Northern market holds back the flow of FDI to the South as the number of MNCs in the South declines) ( pvand improves the North-South wage gap as the relative wage of Northern worker declines. The intuitive explanation is that an expa nsion in the size of the Northern market might out weight the cost saving advant age of a lower-Southern wage as the supply of labor in the North increases. Proposition 4-4. An improvement in innovation research and development modeled as an increase in the size of innovation ) (, the innovative R&D pr oductivity parameter ) (, and a subsidy to innovation ) (A (i) decreases the flow of Foreign Di rect Investment to the South as the measure of Multinational Corporations in the South decline ) ( pv (ii) worsens the long-run wage-income distribution between the North and the South by raising the relative wage of Northern workers ) ( Proof. See Equations 4-25 and 4-26. While, most papers studied the effect of FDI to innovation rate, we used computer simulation to analyze the effect of an improvement in the innovation process to a firms’ decision to become a MNC. An increase in the size of innovation enables Northe rn quality leaders to charge a higher price and achieve a higher level of profit without moving their production to the South. In addition, the larger i nnovation size in the North increases the relative wage of Northern workers as more industries keep their production of thestateof-the-art product in the North which in turn increases the North-South wage gap. Other factors that encourage innovation process such as a subsidy to innovation and an improvement in the innovative R&D productivity also increase the North-South wage gap and d ecrease the flow of FDI to the South region.

PAGE 78

78Proposition 4-4. An increase in the popul ation growth rate ) ( n increases the measure of Multinational Corporations in the South ) ( pvand the North-South wage gap ) ( while, an increase in R&D difficulty ) (has the opposite steady-state effect. Proof. See Equations 4-25 and 4-26. An increase in the population grow th rate leads to an increase in FDI since the market sizes in both regions expand. This induc es the Northern quality leader to move their production based to the South in order to enjoy hi gher level of profit. On the other hand, an increase in the level of R&D difficulty reduces the flow of MNCs as te chnology transfer between regions might be more difficult to complete. Moreover, more resources are devoted to innovative R&D sector as the level of difficulty increase. These results are ba sed on an assumption of negative spillovers of patents to innovation process. Conclusion This paper has introduced an endogenous pro cess of multi-nationaliz ation into a NorthSouth model with a finite patent protection wh ich is perfectly enfor ceable in the North but imperfectly enforceable in the South. The main fo cus of the paper is to examine the steady-state effects of patent protection policy, globaliza tion measured as a geographic expansion of developing countries and change s in innovation technology on the decision of becoming MNCs and income distribution. We f ound that stronger IPRs protection in the South modeled as an increase in patent length decreases the flow of FDI and also worsens the wageincome distribution between regions. On the other hand, an increase in the size of the Southern population accelerates FDI but also worsens the No rth-South wage gap due to an increase in the supply of labor in the South. Then, we explored the effect of changes in innovation process and

PAGE 79

79 concluded that an improvement in innovation technology leads to a decline in FDI to the South and also worsens the income distribution between regions. Further study could be extended in various area s regard patent enforcement and FDI. Trade cost and technology transfer cost could be introduced into th e present model. The structure of knowledge spillovers from FDI to innovation is also an interesting area to explore. Lastly, a growing trend known as South-North FDI as occurring between Indi a and United Kingdom (World Bank 2007) suggests that the innovation could happen not only in the North but also in the South. A study of the effects from this phenomenon on income distribution and global innovation is an interesting area of research. Algebraic Details To show that the value of the North-South wage gap in Equation 4-20 is greater than 1, let assume 1 ) ( 1 S S N N S S N NL c L c L c L c (4-32) Rearranging Equation 4-32, we have ) ( 1 1S S N N S S N NL c L c L c L c (4-33) Equation 4-33 is true since 1 S S N N S S N NL c L c L c L c from the assumption that the probability of patent enforcement is) 1 0 ( Therefore, Equation 4-32 is also true. Next, we show the derivation of the NorthSouth wage gap equati on from Equation 4-20. Simplifying the Multi-nationalization e quilibrium condition (Equation 4-19) as S S N N S S N NL c L c L c L c 1 1 1 (4-34)

PAGE 80

80 Rearranging Equation 4-34, we have 1 1 1 S S N N S S N NL c L c L c L c. (4-35) Adding both side of Equation 4-35 with 1 and rearranging Equation 4-35, we have S S N N S S N NL c L c L c L c 1 1 1 (4-36) Multiplying both side of Equation 4-36 with and rearranging Equation 4-36, we have the North-South wage gap condition as in Equation 4-20. S S N N S S N NL c L c L c L c 1 1 (4-37) The derivation of the North-South wage gap in term of the per-capita global consumption expenditure (Equation 4-22) can be shown by s ubstituting the relative wage from Equation 4-20 to the lefthand side of the I nnovative R&D condition (Equation 4-21). S S N N S S N N S S N N S S N NL c L c L c L c L c L c L c L c T1 1 1 1 1 ) ( (4-38) Simplifying Equation 4-38 and rewriting it as S S N N S S N N S S N N S S N NL c L c L c L c L c L c L c L c T 1 1 1 ) ( (4-39)

PAGE 81

81 Simplifying Equation 4-39 and using the defini tion of the per-capit a global consumption expenditure. Then, we equate Equation 4-39 to the right-hand side of the innovative R&D condition (Equation 4-21) as ) 1 ( ) 1 )( (AL c T (4-40) Finally, we can solve the North-South wage gap in term of the per-capita global consumption expenditure as in Equation 4-22 as ) 1 ( ) 1 )( (AL c T (4-41) To solve for the steady-state solution of th e per-capita global consumption expenditure, we rewrite the per-capita Northern full-employm ent condition (Equation 4-16) in term of the measure of industries with active pate nts. From Equation 4-16, we have c L L L v nN p (4-42) Rearranging Equation 4-42, we have 1 c L L L n vN p. (4-43) Then, we rewrite the per-capita Southern full-employment condition (Equation 4-18) in term of the measure of industries with active pa tents. First, we rewr ite Equation 4-18 as ) 1 (p p Sv v c L L (4-44) Simplifying Equation 4-44, we have ) 1 (p Sv c L L (4-45) Rearranging Equation 4-45, we have

PAGE 82

82 1 1 c L L vS p. (4-46) Next, we equate Equation 443 with Equation 4-46 to solve for the steady-state value of the per-capita global cons umption expenditure as c L L c L L L nN S1 1. (4-47) Simplifying Equation 4-47, we have c L L c L c L c L L L L nN S S N 21 1 (4-48) Substituting the North-South wage gap from Equation 4-22 into Equation 4-48 as L c T c L L L c T L L c L L L L c T L nA N A S S N A) 1 )( ( ) 1 ( ) 1 )( ( ) 1 ( 1 ) 1 )( ( ) 1 ( 12 (4-49) Multiplying L to both side of Equation 4-49 as ) 1 )( ( ) 1 ( ) 1 )( ( ) 1 ( ) 1 )( ( ) 1 (2 T L L c T L c L L L n L c T nA N A S S N A. (4-50) Rearranging Equation 4-50 as L c T n L c T L c L L L n T LA A S S N A N) 1 )( ( ) 1 ( ) 1 )( ( ) 1 ( ) 1 )( ( ) 1 (2 (4-51) Rearranging Equation 4-51 as L T n L T L L L L c n T LA A S S N A N) 1 )( ( ) 1 ( ) 1 )( ( ) 1 ( 1 ) 1 )( ( ) 1 (2 (4-52) Using Equation 4-52, we can solve for the steady-state value of the per-capita global consumption expenditure as in Equation 4-24 as

PAGE 83

83 n T L n L L T L L L cA N S A N S ) 1 )( ( ) 1 ( ) 1 )( ( ) 1 ( ˆ (4-53) Next, we show the derivation of the steady-st ate value of the measure of industries with active patents. First, we solve the per-capita Northern full-employment condition from Equation 4-16 in term of the North South wage gap as 1 L v n L L cp N (4-54) Second, we solve the per capita Southern full-employment condition from Equation 4-18 in term of the North-South wage gap as 1) 1 ( c v L L c vp S p (4-55) Then, we equate Equation 4-54 and Equate 4-55 as L v n L L v c v L Lp N p p S ) 1 (. (4-56) Simplifying Equation 4-56 and moving the measure of industries with active patents to the same side as p p N Scv v L L L n c L L (4-57) Rearrange Equation 4-57 and solve for the m easure of industries with active patents as 1 c L L L n c L L vN S p (4-58)

PAGE 84

84 We imposed the condition n L LS N to ensure that the measure of industries with active patents is less than unity. Substituting th e steady-state value of the per-capita global consumption expenditure from Equation 4-24 into Equation 4-58, we can solve for the steadystate value of the measure of the industries with active patent as in Equation 4-26 as n T L n L L T L L L L L L n n T L n L L T L L L L L vA N S A N S N A N S A N S S p) 1 )( ( ) 1 ( ) 1 )( ( ) 1 ( ) 1 )( ( ) 1 ( ) 1 )( ( ) 1 ( ˆ. (4-59) Proof of Proposition 4-3 (i). By differentiate Equation 4-26 with respect to the size of the Southern population 0 ) 1 )( ( ) 1 ( ) 1 )( ( ) 1 ( ) 1 )( ( ) 1 ( ) 1 )( ( ) 1 ( ) 1 )( ( ) 1 ( ) 1 )( ( ) 1 (2 n T L n L T L L L n L L n T L T L n T L n L T L L L L vA N S A N S N N S A N A N A N S A N S N S p Proof of Proposition 4-3(ii). By differentiate Equation 4-25 w ith respect to the size of the Southern population

PAGE 85

85 0 ) 1 )( ( ) 1 ( ) 1 )( ( ) 1 ( ) 1 ( ) 1 )( ( n T L T L T LA N A N A S

PAGE 86

86 Figure 4-1. Multi-nationalization process in a North-South model North South Innovation and Production of new products Production of MNCs MNCs products become generic with probability 1 MNC rate ( )

PAGE 87

87 CHAPTER 5 CONCLUSION We developed a closed-economy product-cycl e model and the Nort h-South product-cycle trade models with different setting in patents protection. We found that globalization has an adverse effect to the wage-income distributi on between regions by increasing the North-South wage gap. Moreover, with the introduction of fo reign direct investment and free trade to the model, patent protection reduces the flow of foreign direct inve stment to the South and also worsens the wage-income distri bution between regions. We also found the same steady-state effects from an improvement in innovation techno logy to the flow of FD I and the North-South wage gap. Lastly, we investigated various effects to the resources used in the patent enforcement sector and found that an increase in patent length induces an incr ease in the resources used in patent enforcement sector and increases the probab ility of patent enforcement in the country. We concluded that economies with low productivity of R&D have weaker patent enforcement policies and lower long-run Schumpeterian growth. Various aspects of the models can be exte nded for further study. Skilled and unskilled labors can be introduced to analyze effects to income distribution within a country. An introduction of trade cost to the North-South mo del with FDI is also interesting to examine. Further study regard welfare implication can be investigated. However, welfare analysis is complicated due to different components that depe nd on various factors. It is beyond the scope of the current model to examine the change in the discounted consumer utility overtime. See Dinopoulos and Segerstrom (2007) for a study of th e steady-state welfare analysis where they examine the change in the st eady-state utility paths before and after policies change.

PAGE 88

88 LIST OF REFERENCES Anderson, J.E., Wincoop, E., 2004. Trade costs. Journal of Economic Literature. 42(3), 691-751. Bhagwati, J.N., 2004. In Defense of Globalization. Oxford University Press, New York. Branstetter, L., Fisman, R., Foley, F.C., Saggi, K., 2007. Intellectual property rights, imitation, and foreign direct investment: Theory and evidence. NBER Working Paper 13033. Dinopoulos, E., 1996. Schumpeterian Growth Theo ry: An Overview. In: Helmstadter, E., Perlman, M. (Eds), Behavioral Norms, T echnological Progress and Economic Dynamics: Studies in Schumpeterian Economics. Univ ersity of Michigan Press, Ann Arbor, Michigan. Dinopoulos, E., Gungoraydinoglu, A., Syropoulos, C., 2005. Patent Protection and Global Schumpeterian Growth. In: Dinopoulos, E., Krishn a, P., Panagariya, A., Wong, K. (Eds), Trade, Globalization and Poverty, Routledge, New York. forthcoming. Dinopoulos, E., Kottaridi, C., The growth effect s of national patent policies. Review of International Economics. forthcoming. Dinopoulos, E., Segerstrom, P.S., 1999. A Schum peterian model of protection and relative wages. American Economic Review. 89(3), 450-472. Dinopoulos, E., Segerstrom, P.S., 2005, May 16. A theory of North-South trade and globalization. Retrieved September 7, 2005, from http://bear.cba.ufl.edu/dinopoulos/PDF/NorthSouthTrade.pdf. Dinopoulos, E., Segerstrom, P.S., 2007, August 6. Intellectual property rights, multinational firms and economic growth, Retrieved December 3, 2007, from http://bear.cba.ufl.edu/dinopoulos /PDF/MultinationalFirms.pdf. Fan, C.S., Cheung, K.Y., 2004. Trade and wage inequality: The Hong Kong case. Pacific Economic Review. 9(2), 131-142. Fink, C., Maskus, K.E., 2004. Intellectual Prop erty and Development: Lessons from Recent Economic Research. World Bank and Oxfo rd University Press, New York. Ginarte, J.C., Park, W.G., 1997. Determinants of patent rights: A crossnational study. Research Policy. 26(3), 283-301. Glass, A.J., Saggi, K., 2002. Intellectual property ri ghts and foreign direct investment. Journal of International Economics. 56(2), 387-410. Glass, A.J., Wu, X., 2007. Intellectual propert y rights and quality improvement. Journal of Development Economics. 82(2), 393-415.

PAGE 89

89 Grossman, G.M., Helpman, E., 1991. Quality la dders in the theory of growth. Review of Economic Studies. 58(1), 43-61. Grossman, G.M., Lai, E.L.-C., 2004. International protection of intellectua l property. American Economic Review. 94(5), 1635-1653. Helpman, E., 1993. Innovation, imitation and inte llectual property right s. Econometrica. 61(6), 1247-1280. Hill, C.W.L., 2002. International Business: Competing in the Global Market Place McGraw-Hill College, Columbus, Ohio. Howitt, P., 1999. Steady endogenous growth with population and R&D input s growing. Journal of Political Economy. 107(4), 715-730. Krugman, P.R., 1979. A model of innovation, technology transfer and the world distribution of income. Journal of Political Economy. 87(2), 253-266. Lai, E.L.-C., 1998. International intellectual prop erty rights protection an d the rate of product innovation. Journal of Developm ent Economics. 55(1), 133-153. Lee, J.Y., Mansfield, E., 1996. Intellectual property protection and U.S. foreign direct investment. Review of Economics and Statistics. 78(2), 181-186. Maskus, K.E., 2000. Intellectual Property Rights in the Global Economy. Institute of International Economics, Washington, DC. Park, W., 2001, December. R&D spillovers and intellectual property rights. Retrieved October 27, 2006, from http://www.american.edu/academic.depts/cas /econ/faculty/park/RD %20Spillovers%20IP Rs.pdf. Romer, P.M., 1990. Endogenous technology change Journal of Political Economy. 98(5), 71102. Segerstrom, P.S., 1998. Endogenous growth without scale effects. American Economic Review. 88(5), 1290-1310. Sener, M.F., 2005 August. Intellectual property rights and rent protection in a North-South product cycle model. Retrieved January 29, 2006 from http://www1.union.edu/senerm/Research/Sen er_IPRs_Rent_Protection_PAPER_July_06. pdf. Wacziarg, R., Welch, K. H., 2003. Trade liber alization and growth: New evidence. NBER Working Paper 10152. World Bank, 2007. Global Development Finance 2007: The Globalization of Corporate Finance in Developing Countries. Wo rld Bank, Washington, DC.

PAGE 90

90 Wu, Y., 2005. The effects of State R&D tax cr edit in stimulating private R&D expenditure: A cross-state empirical analysis. Journal of Policy Analysis and Management. 24(4), 785802

PAGE 91

91 BIOGRAPHICAL SKETCH Pipawin Leesamphandh was born in Bangkok, Tha iland. She attended Bodin Decha (Sing Singhasaenee) school from 1990-1994. She graduated from Thammasat University and received a Bachelor of Arts in economics in 1998. After she received a Master of Arts in International Economics and Finance from Chulalongkorn Univer sity in 1999, she began to work as a financial analyst in the financial planning depa rtment at Kasikorn Bank. In 2001, she became a research assistant at the Fiscal Policy Research Institute. Pipawin received a scholarship from the Thai Government to study economics and began he r graduate studies at the University of Florida, Gainesville, USA in August 2003. She sp ecialized in internati onal trade and economic theory. After she graduated from the University of Florida in August 2008, she went back to Thailand and works for the Thai government.