Role of Intellectual Property Rights Protection on India’s International Factor Mobility: An Empirical Evidence from Bilateral Data Analysis

Abstract

This study empirically investigates the impact of intellectual property rights protection on Indian bilateral emigration and inward FDI stock using a balanced panel dataset considering India as a reporting country with 71 partner countries for the period 2007-2023. The empirical estimation of the study employs both the single equation model technique, such as the Poisson pseudo-maximum likelihood estimator, and the simultaneous equations model technique, such as the three-stage least squares estimator, to minimize the gap in econometric modeling. Our analysis finds that the overall IP protection of the reporting country has an insignificant effect on bilateral emigration and inward FDI. However, the components, such as the legal and political environment and physical property rights of the reporting country, have a negative significant effect, while the intellectual property rights of the reporting country significantly and positively influence Indian bilateral emigration and inward FDI. Furthermore, this study confirms that the overall IP protection, legal and political environment, and physical property rights of partner countries positively and significantly affect bilateral emigration and inward FDI. On the other hand, the intellectual property rights of partner countries negatively and significantly influence Indian bilateral emigration and inward FDI. These results imply that a robust IPR regime of reporting and partner countries promotes bilateral emigration from India and inward FDI to India. As a result, effective policies that harness these interactions can improve India’s economic benefits and contribute to its long-term prosperity in international business and relations.