Question

Do intellectual property rights play an important role in 21st-century international trade, not just regarding foreign direct investment, but also the flow of goods and services?

Answer 1

Intellectual property rights play an important role in international trade. TRIPS or trade related intellectual property rights protection help to assist in making investment in research and development. WTO is trying hard to protect the intellectual property rights of members.

If these rights are protected, foreign direct investment can be promoted. Investors make investment since their products can not be imitated by other, so the profits of these firms is sustained.

When profits of patent holders are protected, they further make investment on research and development and promote more production of goods and services. Protection of IPR, increases overall production of goods and services and firms can easily make export of these goods and services.

To sum up, protection of IPR increases both foreign direct investment and flow of goods and services.