A Schumpeterian Model of Wage
Inequality and Intellectual Property Rights Enforcement

This paper addresses the concern of whether the determinants of patent infringement and declaratory judgement suits may affect both long-term economic performance and wage inequality. In doing so, we construct a quality-ladder R&D-based endogenous growth model, in which the institutional setting for patent protection directly impacts the long-run private incentive to conduct R&D as well as to invest in human capital. We find that both the institutional setting and the Court's behaviour exacerbate wage inequality, while the steady-state effects on R&D effort and long-run growth are mixed. [JEL Classification: F10, F12, L16, O31]

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* Parello@ires.ucl.ac.be
* luca.spinesi@tin.it

C.P. Parello acknowledges the financial support of the Belgian research programmes "Poles d'Attraction inter-universitaires", PAI P5/21, and the programme "Action de Recherches Concertée", 03/08-302. The usual disclaimer applies.