Publications
Publications
- 2022
- HBS Working Paper Series
Omnia Juncta in Uno: Foreign Powers and Trademark Protection in Shanghai's Concession Era
By: Laura Alfaro, Cathy Bao, Maggie X. Chen, Junjie Hong and Claudia Steinwender
Abstract
We investigate how firms and markets adapt to trademark protection, an extensively used
but under-examined form of IP protection to address asymmetric information, by exploring
a historical precedent: China’s trademark law of 1923. Exploiting unique, newly digitized
firm-employee and firm-agent datasets from Shanghai in 1872-1941, we show that
the trademark law, established as an unanticipated and Western-disapproved response to end
foreign privileges in China, shaped firm dynamics and relationships on all sides of trademark
conflicts. Western firms with greater dependence on trademark protection grew and
raised brand investment, while Japanese businesses, most frequently accused of counterfeiting,
contracted despite attempts to build their own brands. The trademark law also fostered
relationships with domestic intermediaries, both within and outside the boundaries of
Western firms, and the growth of the Chinese intermediary sector. At the market level, the
trademark law did not reduce competition or raise brand prices, leading to a coexistence of
trademarks and competitive markets and ultimately gains in consumer welfare. A comparison
with previous attempts by foreign powers—such as extraterritorial rights and bilateral
treaties—shows that the alternative institutions were broadly unsuccessful.
Keywords
Trademark; Firm Dynamics; Intermediaries; Intellectual Property Institutions; Trademarks; Intellectual Property; Laws and Statutes; Outcome or Result; Organizational Change and Adaptation; China
Citation
Alfaro, Laura, Cathy Bao, Maggie X. Chen, Junjie Hong, and Claudia Steinwender. "Omnia Juncta in Uno: Foreign Powers and Trademark Protection in Shanghai's Concession Era." Harvard Business School Working Paper, No. 22-030, November 2021. (Revised November 2022. Revise and Resubmit American Economic Review.)