Patent protection, intelligence and economic growth: a cross country empirical investigation
Extant literature on the link between patent protection and economic growth have yielded inconclusive results. In this study, we aim to engage in this debate by conjecturing that intelligence moderates the effect of patent protection on economic growth. Using annual data of 88 nations from 1970 to 2013 we find that patent protection has positive effect on growth only after accounting for the interaction between IQ and IPR. Indeed, we find that the interaction term is negative and statistically significant suggesting that countries with higher level of intelligence (above 90 points) can offset the negative effect of weak IPR protection. The results remain robust for a battery of robustness tests.