Question

Identify how protecting sovereign boundaries in regards to intellectual property has a positive effect on the GDP in at least 150 words. Your answer should be in complete sentences.

Answer 1

Protecting sovereign boundaries regarding intellectual property has a positive effect on the GDP because by protecting intellectual property through the use of patents and copyrights, other countries and companies cannot make money by simply copying what another has done.

However, the protection of the inventor's rights that patents give are usually limited so that there is time for the original inventor to gain profit from their intellectual property before others are permitted to develop the innovation further later on. After the original inventor dies or the patent expires, such a design can be shared with others to promote efficiency and forward-thinking in the economy as a whole as well as to inspire possible future inventors.

To recap, protecting intellectual property allows for more monopolistic competition between companies and countries, which has a positive effect on the overall GDP as well as provides incentives that are known to promote economic growth.

Answer 2

The establishment of patents and other mechanisms that enforce intellectual property rights are a manner of rewarding effort and innovation. When a company devises an innovative product or a more efficient production technique, holding a patent allows them to exploit it in a exclusive regime, so that no one else can copy or profit from their idea. However, those rights are limited in time, that should be enough for them to recover the investment made to develop the innovation and to earn reasonable profits, and afterwards such innovation can be shared with others to foster efficiency in the economy as a whole.

Such system incentives firms to invest in innovation and to become more efficient (produce more with the same amount of inputs). Therefore the establishment of boundaries to protect intellectual property increases investment and production activities, and these rise the GDP of a country.