Democratizing intellectual property systems: How corruption hinders equal opportunities for firms

This paper analyses how corruption affects firms’ ownership of intellectual property titles that relate to firms’ technological, organizational and further innovation efforts: quality certificates and patents. Using firm-level data covering 48 developing and emerging countries, we show corruption reduced the likelihood of firms seeking quality certificates. Smaller firms were more affected by corruption and benefited less from higher levels of trust in their business environment. Corruption did not have impacts on the quality certificate ownership of exporters, foreign- and publicly-owned firms. Firms’ machinery investments were also negatively affected. By contrast, we do not find effects on firms’ ownership of patents.

Keywords: Intellectual property, corruption, trust, firm heterogeneities, innovation, developing and emerging countries

JEL Classification: O34, O12, D23, L6, L2