Abstract: Technology diffusion and spillovers are key drivers of both innovation and economic growth. This paper examines the effects of obtaining initial intellectual property rights on international knowledge flows through new technological entrants, an important yet understudied function of the IP system. We propose a simple theoretical framework which examines exclusivity and proximity effects as countervailing forces acting on the broader diffusion of foreign-developed technology within a host country. Our study provides causal evidence that a foreign technological entrant’s initial patent grant in the host country (the United States) increases the likelihood of international knowledge flows to local U.S. firms and other patenting entities (7.1 percentage points and 29.4 percent, respectively), demonstrating the importance of patent rights in facilitating international knowledge flows beyond the disclosure mechanism. These effects are at least partly driven by sustained presence, cross-country differences in search costs, and voluntary technology sales, but the evidence on inventor mobility is mixed. Overall, initial intellectual property rights appear to mitigate impediments to cross-border knowledge flows in this setting, and the benefits of doing so outweigh the frictions arising from the exclusionary nature of patents.
Abstract: We examine the implications of linguistic fractionalization on trade and welfare, focusing on the United States. Our model identifies the direct and indirect effects of fractionalization on international and domestic trade and welfare. We construct a novel dataset to show that changes in fractionalization impact trade, leading to significant economic consequences. To highlight the general equilibrium implications, we conduct simulations on language policy-induced changes in the shares and the composition of Hispanic speakers within the United States, showing the importance of considering language policies, as they can yield substantial economic benefits but also sizable economic consequences stretching beyond national borders.
VoxEU Note: One Language, One Nation: Language Policy and Economic Integration
Linguistics Dataset: A Dataset on Linguistic Connectivity Across and Within Countries (2025, Sci Data), Data repository
Abstract: As preferential trade agreements (PTAs) have grown in their scope and complexity, so too has the need to capture this heterogeneity in assessments of their effects. This paper demonstrates an approach for estimating the effects of “deep” PTAs that allows for non-linear impacts from increased depth. It finds that deeper PTAs can increase trade but that there are diminishing—and eventually negative—marginal returns from adding additional policy provisions. This finding fits the observation that certain deep policies may represent new frictions to trade rather than facilitation efforts. To illustrate the potential trade and welfare gains that can be attained by increasing the depth of shallow PTAs, a series of counterfactual simulations are undertaken using the Agadir agreement between Egypt, Jordan, Morocco, and Tunisia as an example. The counterfactual analysis suggests that increasing the depth of the relatively shallow Agadir agreement could increase trade between its members by about 13 percent and the value of their real manufacturing outputs by up to 0.3 percent. Notably, the exercise demonstrates that the optimal version of an agreement is not necessarily the deepest.
