Exploring the Nexus of Intellectual Property Rights Infringement and Socio-Economic Factors: Evidence from a Global Perspective

Abstract

This paper contributes to the ongoing discourse on the relationship between intellectual property rights (IPR) infringement and socio-economic factors by employing a bivariate Granger causality test. By utilizing data from 100 countries over a 16-year period, the study explores the interplay between IPR infringement, income levels, sociopolitical factors, and legal factors. Through co-integration analysis employing an error correction model, the study sheds light on the causality issue among these variables. The findings reveal a bi-directional causality between corruption and piracy rates, suggesting a mutually reinforcing relationship between these factors. Additionally, the study demonstrates that the rule of law exerts a causal influence on piracy rates, indicating the importance of legal frameworks in shaping intellectual property infringement. However, the causal relationship does not appear to be reciprocal, suggesting that piracy rates do not significantly impact the rule of law. Interestingly, the study uncovers nuanced dynamics regarding the impact of piracy on economic growth. While piracy demonstrates a short-term stimulatory effect on growth, particularly in the context of certain socio-economic conditions, such as corruption, the long-term relationship reveals a dampening effect of growth on piracy rates. This suggests a complex interplay between piracy, economic development, and institutional factors over time. Overall, these findings provide valuable insights into the multifaceted relationship between IPR infringement and socio-economic factors, highlighting the importance of addressing corruption and strengthening legal frameworks to combat piracy effectively while also fostering sustainable economic growth.