Intellectual Property Rights and Their Impacts in Developing Countries: An Empirical Analysis of Maize Breeding in Mexico

There is little empirical evidence concerning the effects of intellectual property rights (IPR) on a technologically advanced developing country. Complete enumeration of the Mexican maize breeding industry showed that, contrary to the hypothesis that IPR would provide, in a technologically advanced developing country, incentives for R&D and innovation, IPR play no role for the industry in general, but that they are important for certain breeders' categories. The paper presents the theory on IPR and a short background on the Mexican maize breeding industry. The analysis of the interviews with maize breeders leads to the conclusion that the theory on IPR should be revised and take into account the characteristics of developing countries critical for the good functioning of IPR, especially the quality of the institutional environment and the judiciary system, and the importance of transaction costs related to IPR protection. The level of technological development also determines the extent to which actors can benefit from IPR protection. Given the relatively good score of Mexico on these two critical factors, IPR are likely to play an even smaller role for other developing countries.