Intellectual Property Rights and Economic Inequality: Theory and Evidence1

Abstract

I am pleased to be able to contribute to the special issue honoring Professor Marianne Levin. Marianne has long been a global leader in the legal analysis of intellectual property (IP) policy and has particularly been concerned with various socioeconomic ramifications of IP rights (IPRs). In that spirit, I offer this piece on a deeply important yet understudied aspect of IPRs: how do such rights interact with economic inequality, within and across nations? This complex question only recently has begun attracting attention by economists, despite massive concerns over growing inequality and its potential effects. In this paper I review the limited, yet substantive, theoretical and empirical studies of this issue. My objective is to explain how economists think about it, noting, for example, that there could be two-way causal impacts between IPRs and inequality.