OECD Economic Studies No. 40, 2005/1

Contents | How to obtain this publication | Additional information

Contents                                                                                                                                                 

International licensing and the strengthening of intellectual property rights in developing countries during the 1990s

Walter G. Park and Douglas Lippoldt

This paper assesses the effect of strengthened intellectual property rights in developing countries on international licensing activity. The analysis draws on indicators for four dimensions of intellectual property right stringency (covering patent rights, copyrights and trademark rights, as well as enforcement effectiveness) and on firm-level data related to licensing. Overall, the analysis points to a net positive effect of IPR strength on licensing activity, an effect that is strongest with respect to the indicators for patent rights and effective enforcement. Where developing countries have moved to address weaknesses in these areas in recent years, they have tended to experience increased inward licensing of intellectual assets. The overall implication is that intellectual property rights can play an important role in enabling firms in developing nations to access and exploit technologies and know-how through licensing agreements with parties in developed nations.

Counting immigrants and expatriates in OECD countries: a new perspective

Jean-Christophe Dumont and Georges Lemaître

Traditionally, immigrant stocks have been estimated by the foreign-born population in some countries and the foreign population in others. With the 2000 round of censuses, almost all OECD countries have identified the country of birth of enumerated persons. This allows for a more comprehensive and comparable portrayal of migration movements both within and to the OECD zone over recent decades, with a number of European countries showing immigrant numbers that are as large in relative terms as those observed for the United States. In addition, data on the educational attainment of the population permit, for the first time, direct estimation of the extent of expatriation of highly educated persons to OECD countries for over a hundred countries of origin across the globe. For a number of countries, more than half of all highly educated persons born there are living (and working) in OECD countries. Expatriation of the highly educated on this scale constitutes a significant drain on the human capital capabilities of these countries.

Corporate sector vulnerability and aggregate activity

Mike Kennedy and Torsten Sløk

Using micro data for individual firms, this paper finds that non-financial corporations in Japan and the major European countries in 2003 were more vulnerable to a rise in short-term interest rates than they were in 1993 when the previous interest rate tightening cycle began (with a vulnerable firm being defined as one which has a high debt-to-equity ratio and a low ability to service the debt). In contrast, firms in the United States and Canada appear more prepared for rising interest rates. Furthermore, looking only at data from 2003 the paper finds that firms in Japan and the major euro area countries are more vulnerable than firms in the United States, Canada and the United Kingdom. The micro data are also used to create for each country an economy-wide measure of vulnerability, which turns out to be significantly related to future movements in GDP and investment growth.

Explaining risk premia on bonds and equities

Torsten Sløk and Mike Kennedy

This paper assesses the extent to which movements in risk premia of a number of financial assets are related to general economic fundamentals and OECD-wide measures of the stance of monetary policy. To do this, principal component analysis is used to identify a common driver of risk premia in US and European equities and corporate bonds, and emerging-market debt since the beginning of 1998. The analysis finds that, after controlling for the effects of corporate governance scandals that erupted during the summer of 2002, expectations regarding economic fundamentals and measures of the stance of monetary policy have played statistically significant roles in driving the common factor. It also finds that in terms of explaining risk premia, liquidity (measured as the GDP weighted average of M3 growth of the three major economies less its trend) performs better in a statistical sense than similarly weighted short-term interest rates, although both are significant.

Whatever happened to Canada-US economic growth and productivity performance in the information age?

Tarek M. Harchaoui and Faouzi Tarkhani

Productivity growth in the US economy jumped during the second half of the 1990s, a resurgence that the literature linked to information technology use. We contribute to this debate in two ways. First, using the most comparable Canadian and US data available, we quantify in a comprehensive way the contributions of information technology to output, capital input and productivity performance. Second, we examine the extent to which information technology-producing and information technology-using industries have contributed to the aggregate multifactor productivity revival. Our results suggest that while information technology is indeed the story in the US productivity revival, it is only part of it in the Canadian context. The US labour productivity revival is primarily attributable to information technology capital deepening and multifactor productivity gains of information technology-producing industries, a finding that somewhat contrasts with the common US wisdom. The Canadian evidence points towards the importance of multifactor productivity gains in information technology-using industries as a major source of productivity acceleration. These results stand even after a "correction" for the methodological differences in the measurement of information technology prices at the industry level, thereby indicating important differences in the economic structures between the two countries. The continuation during the 2000-2003 period of the rapid multifactor productivity gains that started during the late 1990s tends to suggest that little of this productivity upsurge was cyclical.

Indicator models of real GDP growth in the major OECD economies

Nigel Pain and Franck Sédillot

This paper develops a set of econometric models that provide, on a regular basis, timely estimates of GDP growth for each of the G6 economies and the aggregate euro area in the two quarters following the last quarter for which official data have been published. Based on a parsimonious approach that focuses only on a small range of high frequency monthly indicator variables, the models are found to outperform a range of other models that use only published quarterly data. This suggests that there are clear gains from developing empirical indicator models that use high-frequency data, both in terms of forecast-error size and directional accuracy. The most suitable model for any given information set and any fixed forecast horizon is found to vary across both countries and over time. The paper also describes some of the practical problems that can arise in using such models in real time, including ways of assessing forecast uncertainty, and reviews the real-time performance of the models over the past two years. Cross-country differences in real-time forecast errors are found to be broadly consistent with those expected on the basis of an out-of-sample exercise on the vintage of data used to estimate the models.

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