During the late 1990s the market value of businesses grew at 15% per year. It is hard to reconcile such fast growth with the observed rates of investment in physical capital and R&D. We therefore propose a model in which new ideas are privately owned, but discovering them does not require resources. In our model it is possible that market value rises very rapidly without drastic changes in fact...

a r t i c l e i n f o Available online xxxx JEL classifications: O33 O34 O41 Keywords: Intellectual Property Rights (IPR) Economic growth North–south model In this paper, we develop a general equilibrium endogenous growth model that emphasizes the IPR enforcement effects on growth, in a scenario of north–south technological knowledge diffusion. The economy consists of three sectors, and firms a...