Intellectual property rights and private foreign direct investment in Sub-Saharan Africa

Abstract

This article examines the impact of Intellectual Property Rights (IPRs) on private foreign direct investments (PFDI) for a cross-section of Sub- Saharan African (SSA) countries. The results of the study indicate that: (1) strengthening IPRs has a significant positive effect on PFDI, however, beyond a certain optimal level, the effect becomes negative; (2) the trade related agreement on intellectual property has had positive but insignificant effect on PFDI; (3) investors are sensitive to the investment climate of the countries in which they invest; and (4) inflation rate is negatively correlated with PFDI inflows.