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5 ways to close the global innovation divide

Anabel Gonzalez's picture
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Participants gather at a hackathon in Nairobi, Kenya (Photo by Flickr user Erik (HASH) Hersman)


High income economies are dominating global innovation. Led by Switzerland, the top 10% are outpacing the rest in innovation as measured by the 2014 Global Innovation Index. This rich-poor innovation divide is striking with a handful of high income countries, mostly in Europe accounting for most of the top 10%. The bottom quintile consists of predominantly low income economies with more than half from Sub Saharan Africa.

 Global Innovation Index Report, 2014
Source: Global Innovation Index Report, 2014


The top innovating economies rate strongly on the quality of their institutions including a stable political environment and an effective regulatory and business environment. They benefit from and continue to invest heavily in human capital, research and development and infrastructure. They score highly on business and market sophistication – good management is fundamental for private sector innovation. They have also established most if not all of the elements of a successful innovation ecosystem. These countries consequently dominate in knowledge outputs including on most measures of knowledge creation, impact and diffusion as well as in technology and creative outputs.

It is difficult to imagine that poor countries or emerging markets without innovation will be able to catch up and become high-income economies in the 21st Century, an era already characterized by previously unimaginable technological progress and, importantly, international diffusion. Populations in these countries are in dire need of innovative solutions to deliver clean water and energy, health and education services, better housing, sanitation and transportation and increased food production while battling the adverse impacts of climate change. These economies need to create jobs for millions of unemployed youth leveraging the benefits of an increasingly digital global economy.

What can be done to bridge this yawning innovation and competitiveness gap?

  1. Increase investments in a shared global innovation agenda. The top innovating economies can do more to invest in developing a shared global innovation agenda that is central to reducing poverty and increasing shared prosperity in the low-income economies. This could include partnerships for sharing of best practices and collaborative research and development on issues such as food security and climate change. Developing countries need to make sure that universities are run as meritocracies, with good quality human capital, and tightly connected to the private sector. Good partners are needed in both ends for the agenda to work.
  2. Facilitate technology diffusion and adaptation. Overcoming barriers to innovation and establishing new mechanisms for transmission of knowledge and skills especially in scaling up workable solutions to benefit the poor is critical. Innovative solutions need to be adapted by local entrepreneurs for scalable programs. These networks of barefoot innovators need to be nurtured and supported from the ground up through programs for training, mentoring, coaching, networking and provision of support infrastructure, seed financing and in leveraging private investment funds for scaling up.
  3. Ensure unfettered flow of talent and knowledge. Flow of skilled individuals and knowledge is vital for global innovation while ensuring that more effective mechanisms are in place to strengthen collaboration, knowledge and experience exchange on developing effective national and regional innovation ecosystems. Emigration of human capital with a vocation for innovation from developing countries has a cost, but migrants can also act as innovation antennas, sending knowledge, capital and encouragement to younger generations of potential inventors in developing countries. The experience of Ireland and India attest to this.
  4. Use intellectual property rights to facilitate innovation for the poor. Intellectual property rights provide a strong incentive for the private sector to invest in innovation and technology adaptation – it may actually contribute to talent retention in developing countries. Trade-offs, including raising the costs of imitation, need to be assessed. Institutional strengthening for adequate implementation is required.
  5. Enhance innovation efficiency and connect innovation to markets.Merely increasing the total expenditure on research and development may be insufficient and perhaps not even wise given the many competing demands for countries’ fiscal resources. A comprehensive assessment of the gaps in the innovation and entrepreneurship ecosystem, targeted interventions to improve outputs of institutions and prioritization of investments especially leveraging private sector ingenuity and resources are likely to yield better outcomes. In this context, nurturing good management is key.

There is encouraging evidence that the small early efforts are starting to pay off. The Global Innovation Index report concludes that Sub Saharan Africa saw the most significant improvement in rankings in 2014 with five countries (Burkina Faso, Gambia, Malawi, Mozambique and Rwanda) classified as innovation learners (economies that perform at least 10% higher than expected for their level of GDP).

There is a generation of young entrepreneurs in low income economies which is well equipped and motivated to develop innovative solutions in areas such as digital, climate resilience, creative and agribusiness technologies. This growing pool of human capital is talented and resourceful. Harnessing the potential of this talent is our collective responsibility.

This post first appeared in the World Economic Forum's Agenda blog.

Comments

Submitted by chiranjibi gautam on

it is better to take young generation in such activities so i salute for such thing
thank you

Submitted by Ravi Gupta on

Glad to note IP finally being acknowledged in WB as an important topic – it is shockingly absent even from the LJD week last several years. But the link of IP to innovation/entrepreneurship and economic development is extremely complex and nuanced. The recent Economist’s front page story (http://www.economist.com/node/21660522/print ) was how the patent system is broken and instead of promoting innovation, rather thwarts it. This was no news to practitioners (Economist article was a “Johnny come lately” for professionals in the field as they have known it for last several decades). In fact the seminal piece by Jaffe in 1999 (http://socrates.berkeley.edu/~scotch/jaffe.pdf ) had brought the argument of importance of patents on innovation to the center of “IP law and economics” debate. Jaffe’s and Lerner’s 2004 book “Patent Failure” (http://press.princeton.edu/chapters/i7810.html ) developed the thinking on the topic. Since then, economists have attempted to disaggregate the effects of two elements of the IP system – the disclosure that the inventor is required to provide so that others can advance knowledge; and the monopoly rents that the IP system provides to the inventor. Much of the literature over last two decades ( most recent being Bessen 2014, Khan 2014 http://funginstitute.berkeley.edu/wp-content/uploads/2013/12/knowshare.pdf and http://www.nber.org/papers/w20732 ) corroborate the strong linkages between the disclosures that occur due to a well-functioning IP regime and economic growth; though increasingly question whether the monopoly rents incentive of patents leads to greater innovation. This is important if WB is to enter this business – would WB focus on knowledge dissemination or the monopoly incentives, to inform its policy advice and TA to governments?

IP regimes impact not just innovation, but also country’s position in GVC, access to medicines, monetizing traditional knowledge and GI, and issues of equity especially as regards access to medicines and clean tech, WTO obligations, and often the regime may have dramatically different and opposite effect on various aspects on economic development and shared prosperity. Hence there can be no one-size-fits-all approach and promoting a stronger rights position is likely to be vigorously challenged from point of view of not just equity but also usefulness of strong IP regime in promoting innovation and economic development. More importantly much of the innovation in developing countries may rely on business models which really do not need the IP system. As the Plumpy Nut controversy (http://news.bbc.co.uk/2/hi/europe/8610427.stm ) shows a strong IP system can adversely impact development goals by blocking access to desperately needed products such as ready to eat foods. Hence a more nuanced position on IP is needed at developmental organizations and not merely cheerleading strong IPRs

Submitted by WB Help on

The Plumpy nuts article was a real eye opener. What is WB position on generics. I know WB is part of GAVI – WB Health

Submitted by Ravi Gupta on

Not sure if WB has a position on generics. Strong IPRs can hamper access to medicines in developing countries and does not necessarily encourage pharmaceutical innovation that responds to developing country needs. Many economists have attributed India’s prowess in generic medicines (that are central to providing healthcare at prices affordable to developing countries), to a weak IP regime and strong compulsory licensing requirements. The argument that strong IPRs will benefit developing countries through future innovation is not borne out by the evidence. Strong IPRs are important for pharmaceutical innovation, but only where there is a strong market, as is often the case for health problems prevalent in the developed world. However, pharmaceutical industries in countries such as India, which have seen their IPR regimes strengthened, are not responding to developing country needs. Instead they too are focusing on developed country markets.

So, for health issues of particular relevance to developing countries, IPRs are of value to commercial product and technology developers only if a viable market can be created (for example, through an advanced market commitment). Furthermore developing countries are typically hostile to rigid rights position which they believe (with good reasons) to be disproportionally favoring the rich, and often times perceived to be abusive. The viscerally opposite reactions by pharma firms and NGOs to the Indian Supreme Court Novartis decision of 2013 in which the court held that Novartis was indeed ever-greening its patents (http://www.msfaccess.org/about-us/media-room/press-releases/indian-supreme-court-delivers-verdict-novartis-case ) is an example of how divergent the views on the topic are. As the case of this Australian man shows (http://www.abc.net.au/news/2015-08-20/hepatitis-c-sufferer-imports-life-saving-drugs-from-india/6712990 ) generics can be life saver even for people in rich countries as their cost can be 1000 times lower!

Furthermore there is significant debate on other incentive mechanisms such as prizes (as opposed to patents) for innovation at least in the medicine/biotech space as Stiglitz argues. ( http://www.project-syndicate.org/commentary/prizes--not-patents ) . Creative arranagements that provide both incentives for innovation and cater to needs of the poor are called for. Possibly the Gilead – IPA (Indian Pharma Association) model is worth studying further (http://blogs.economictimes.indiatimes.com/et-commentary/can-india-america-take-gilead-ipa-model-further/ ) .By and large if WB were to advocate a more robust IP system it would have to reconcile that with health equity and access issues.

Submitted by Kleiner PErkins on

Doesn’t IP system create incentives for inventors and is hence beneficial for innovation and economic growth. And if so would WB be championing greater IP rights in its client’s countries?

Submitted by Atul Wad on

Yes, at one point, IP (patenets etc.) were considered an incentive for etrepreneurs and inventors to develop innovative new technologies and solutions. This derives directly from Schumeter's analysis of entrepreneurship and the implicationsfor economic policy and economic growth.However, though many developing countries have signed the Paris Convention, and have sincere intentions to follow the PTO guidelines, there are many obstacles to the development and encouragementof invenstion and innovation in developing countries simply by IP protection. Apart from a weak IP legal regime to protect these rights, many valuable innovations in develoing countries simply do not satisfy he requirements for patents, and tis is combined by a poor understanding of the patent application process. Furthermore, many solutions that are needed in developing countries do ot necessarily need new IP, but rather very practical soltuions to the problems faced in these countries. ften these can be addressed by the fficiencttransfer of technology. On a different level, a simple numercial tally of the number of patenets issued in a given country does to fully ccapture the full spectrum of vaariables that relate to socio-economic development. Most easures of innovation are driven y economics and a quantitative system, whereas a more accurate and realistic perspective requires the inputs from other sciences, the social sciences, for exmaple, which are not as domintad by quantitaive methods as economics, hysics etc.
In this context, a more effective and realustic approach to the promotion of innovation may need to be based on the easure of the concrete results achieved by an innovation, or a technology, in solving or reducing a development problem or challenge. For instance, a fiter that produces driniking water that is cheap enough to be affordabe to the BOP, and is of high quality, energy efficient and with a high water balance, may not require any new technology. It may be an integrated design involving several sub-systems. The benefit of clean water for thepoor ten become the measure, not the uniqueness of the technoogy.
Whether the WB and similar instituons can adopt/deveop such approaches is a good question. To develop such approaches requires an interdisciplinary approach and framework, a process that involves deep interaction and understaning of user behavior, and an anaytical framework that includes both qualtitateive and qualitative measures. Such capabilities are generally absent in develeopment banks.

Submitted by Ravi Gupta on

Wish life was that simple, Kleiner! IP regimes have different effect depending on nature of IP (GI, patent, copyright, trademark etc.), country’s distance from the technological frontier, nature and robustness of institutions, sector, market power, size of the country etc. In fact country’s position change as they become more innovative. The book Smuggler Nation (http://www.amazon.com/Smuggler-Nation-Illicit-Trade-America/dp/0199360987 ) is latest in the rich literature that chronicles how US became rich through sheer plunder of IP. Developing countries cannot hence be faulted for not wanting stricter IP regimes as almost all nations during industrialization have benefitted from “appropriating” (euphemism for stealing IP) knowledge. The empirical literature also shows that stronger IPRs can possibly encourage domestic innovation, at least in emerging industrialized economies. Nevertheless, the empirical literature suggests the existence of a non-linear function (i.e. a U-shaped curve) between IPRs and economic development, which initially falls as income rises, then increases after that. I.e. at low and high economic development status, countries have stronger IP regime. The inference could be that in a poor developing country a strong IP regime will stifle knowledge flow, but when knowledge is not constricted, it reaches middle income level and is once it become more innovative, the inventive community will clamor from stricter IP regime. Thus a simplistic position that IP promotes innovation may be perilous. Even within a country different sectors will have varying views on the topic – for instance, Bollywood insists of stronger IPR whereas the generics industry is by and large favors less restrictive IPR regime

Furthermore, since “shared prosperity” is one the new WB goals, one also must be cautious about the role of IP. A more “rights” position may not only thwart innovation by monopolizing upstream knowledge in the hands of a few making derivative knowledge inaccessible to entrepreneurs, but worse still exacerbate inequality. The SCOTUS decision on gene patents thankfully avoided such a situation in one major suit but the matter is far from settled as Stiglitz argues ( http://opinionator.blogs.nytimes.com/2013/07/14/how-intellectual-property-reinforces-inequality/ ; and http://news.nationalgeographic.com/news/2013/06/130614-supreme-court-gene-patent-ruling-human-genome-science/ )

Submitted by Peter Cowan on

Doesn't IP system deal mostly with patents and technology. So what is this mixing up with traditional knowledge. And BTW(by the way) what is GI?

Submitted by Ravi Gupta on

GI means geographical indicator. It is one of the most important forms of IP. IP is NOT restricted to technology and patents. It encompasses a wide spectrum of know-how and distinguishing features such as trademarks. The needs of developing countries from the IP system in fact may not even be innovation. It could be to prevent plunder of their natural resources (bio piracy), something that prompted India to develop Traditional Knowledge Database Library (TKDL) to prevent US firms from patenting traditional medicines or trademarking “Basmati” rice. http://news.bbc.co.uk/2/hi/south_asia/4506382.stm. Conversely, developing counties can use the IP system to their advantage by branding their products using the TRIPS provisions for GI. This was done by Ethiopia very successfully for their coffee (http://www.wipo.int/ipadvantage/en/details.jsp?id=2621 ). Long back Michael Finger of WB had done some interesting work in this regard (http://elibrary.worldbank.org/doi/abs/10.1596/0-8213-5487-6 ). Not much of great significance has come from WB since then on the topic.

Submitted by Dave Ballai on

Patents have enormous economic value. Obtaining and protecting intellectual property rights is no longer optional – it is a strategic necessity for business.IP is more than an economic asset – it also forms the basis of a global market.Look at some of the metrics behind some of the corporate world’s most aggressive patent filers today. In 2014, the top 10 firms with the highest volume of granted patents, were awarded an astounding 35,910 patent grants, with IBM breaking the record yet again in garnering some 7,481 patents in a single year. It’s no surprise then to any of us that innovation is driving the run-up in venture investment. The best leaders are spending time and energy in solidifying the protection of their intellectual property through aggressive patent filing and patent portfolio management techniques, using some of the best emerging technologies now available. USPTO Director Michelle Lee recently told the Technology Policy Institute Aspen Forum in Aspen, Colorado that economic research shows small and young company patent holders add disproportionally more new jobs

Submitted by Ravi Gupta on

Tesla’s open patent policy upends conventional thinking on core IP being a vital strategic business asset http://www.forbes.com/sites/realspin/2014/07/17/rethinking-patent-enforcement-tesla-did-what/ . Creative Commons and open source innovation also raise important question on whether a patent system is indeed important for innovation and entrepreneurship. Should WB be promoting such open innovation systems that do not follow traditional IP models as such open systems are likely to be more beneficial for WB client countries?

Moreover, it is important to note that some of the greatest inventions were either not patented or were not amenable to patent system(internet for instance). Jonas Salk saved mankind from the scourge of polio but never patented his vaccine. In fact once asked why he never exercised IP rights, he famously quipped – can one patent the Sun! ( https://www.quora.com/Why-didnt-Jonas-Salk-patent-the-polio-vaccine ) so on one hand we have great inventors and humanitarians who abjured patents and whose inventions greatly benefitted mankind , and on other hand we have rampant abuse of patent system where frivolous inventions are zealously patented such as amazon one-click (https://faculty.ist.psu.edu/bagby/432spring08/t5/Case%20Study%20-%20Amazon.com.html ). Hence the IP debate is very complex and saying” IP regime fosters innovation” may appear platitudinous.

Your point about SMEs is very interesting and true - however it is only part of the story. SMEs are most innovative but have specific challenges in utilizing IP systems and have higher infringement lawsuit risks http://www.citi.columbia.edu/B8210/read16/ProtectingIntellectualProperty%20Rights_AreSmallFirmsHandicapped.pdf . On the other hand, IP can be critical for SMEs and innovators and inventors in well-functioning systems as IP is their only asset and in fact is increasingly used as collateral for financing in most developed countries. This means WB assistance to countries as regards IP system ought to be consistent with its agenda on promoting SMEs. As the above illustrations show, the IP SYSTEM CAN CUT BOTH WAYS.

Equally, it would be important for WB to analyze IP mercantilism in some countries so that it can provide its client appropriate advice. Patent wars are now no longer restricted to software firms in Silicon Valley even countries are getting into patent litigation business (http://www.reuters.com/assets/print?aid=USBRE92J07B20130320 ). These sovereign patent funds are likely to have considerable NEGATIVE impact on start-up activity (http://www.ipnexus.com/how-will-sovereign-patent-funds-affect-startups-and-inventors ) . Hence call for stronger IP systems without factoring in rampant abuses of the system and the maladies afflicting the existing system is likely to be viewed as pablum by client countries.

Submitted by Atul Wad on

In the past most measures of innovation/IP were determined on economic terms. The increasing importance of sustainability as a framework for development, further complicates the matter. With the incorporation of socio-economic, environmental and cultural factors in the optimization model for sustainable development requires the incorporation of measures and concepts from other disciplines, sociology, anthropology, political economy etc. and many of these are not easily quantifiable. As my colleague Dick Nelson has argued, the prevailing paradigm for innovation/IP research has been based on a deterministic perspective which it is increasingly recognized, is limited in its relevance in today’s society. There is lot of discussion on impact of IP system on health related issues. Surely other development related issues such as climate change etc. are impacted by IP - it would be interesting to discuss more.

Submitted by DASHA G on

Very interesting debate on IP and its focus on development. As a GVC expert, I am of the view that stronger IPRs seem to encourage FDI in production and R&D rather than in sales and distribution; hence it may be a good idea to push for stronger IPRs. However I am open to modifying and qualifying my view

Submitted by Ravi Gupta on

While until recently FDI was mostly viewed from the prism of capital deepening, it is now increasing seen as a means for knowledge spillover; hence perhaps a call for stronger rights position in that limited context makes sense. Stronger IPRs seem to encourage FDI in production and R&D rather than in sales and distribution. Well-functioning IPR systems are also positively correlated with integration in GVCs (https://www.wto.org/english/res_e/booksp_e/aid4tradeglobalvalue13_part1_e.pdf )

However overall as regards tech diffusion, the importance of IP system is mixed depending on country situation and industry. Substantial literature attempts to grapple with the trade-off between the impact of weaker intellectual property regimes and the potential for increased technological diffusion in a host country and with the impacts that such regimes might have on foreign partners’ willingness to undertake FDI and licensing agreements. Although the theoretical literature emphasizes the importance of intellectual property regimes (Lai 1998; Taylor 1994), the empirical evidence is ambiguous overall. Some studies find no relationship between the level of intellectual property rights and FDI or licensing (Primo Braga and Fink 2000; Branstetter, Fisman, and Foley 2005; Maskus and Konan 1994). Overall, the impact of intellectual property rights on FDI depends on the nature of the sector. Intellectual property rights appear to have little impact on investment in lower technology goods, such as textiles and apparel; services sectors, such as distribution and hotels; or in sectors where the sophistication of the technology itself or the cost of production already serves as an effective barrier to entry. Indeed, the increased ease with which some products such as pharmaceuticals, chemicals, food additives, and software are reproduced may explain the rising interest in establishing intellectual property rights (Maskus 2000).

While from a strict GVC position having strong IP systems make sense (the example of iPOD workers in China being able to capture very little of the value chain is too well known to worth referencing); the relationship with other dimensions of economic growth and equity is MUCH MORE VEXED.

Submitted by Stuart Graham on

Fascinating discussion. It would be nice if World Bank paid attention to role of institutions in the entire IP and economic development debate. Institutions are critical especially to monitor what is not working. for instance the America Invents Act aims to curtail the abuses of patent trolls

Submitted by Ravi Gupta on

Stuart, your point on institutions is spot- on. Also because of TRIPS, countries need to not only strengthen their domestic institutions but also those that interface with international IP regimes. Regarding your point on AIA, i would reserve my judgment on how effective it has been in tackling trolls - the jury is still out there, but it was a laudable effort.

WB assistance to countries would obviously have to be consistent with international regimes governing IP (TRIPS) that require creation of strong institutions such as specialized IP courts (http://iipi.org/wp-content/uploads/2012/05/Study-on-Specialized-IPR-Courts.pdf ) in all countries to facilitate trade and foster innovation. This is an area where clients may need most help. Evolution of legislation governing national trade courts are also needed to keep pace with proliferation in disputes related to patents (USITC decision on Apple vs. HTC http://www.nytimes.com/2011/12/13/opinion/patents-smartphones-and-the-public-interest.html?_r=4&ref=opinion&gwh=FAFE5078092D66EC3A2419D0B5A788EE&gwt=pay&assetType=opinion ) and legislative action ought to be tailored to circumstances. Perhaps WB strategy to nations in this regard ought to be to help strengthen these institutions.

Most importantly WB should help countries build institutions that can take on the challenges of rapid changes in the field. Even developed countries are finding it hard to keep pace with the issues that new technologies and monetization mechanisms are raising. Novel business models strain the existing thinking and legal frameworks on copyrights as evidenced by cases of ReDiGi and Aereo which illustrate that Copyrights are no longer synonymous with monetization of creative asset due to ability to costlessly replicate and proliferate the asset. http://www.slate.com/articles/technology/future_tense/2013/04/redigi_lawsuit_judge_rules_that_reselling_used_digital_music_is_illegal.html ; and http://www.npr.org/sections/thetwo-way/2014/06/25/325488386/tech-firm-aereo-performs-an-illegal-service-supreme-court-says )

A more rigid rights position can also deleteriously impact legitimate knowledge sharing as the ill-advised legislation of POPA and SIPA attempted but were thankfully defeated after a huge public outcry (http://www.marketplace.org/topics/tech/pipa-sopa-and-open-three-acronyms-could-change-internet ). WB assistance hence obviously cannot be based on peddling old IP systems that worked for developed countries in the last century. Since IP regimes have different impact on different sectors; plus the national IP regime ought to be TRIPS compliant any WB intervention should be cognizant of the issues surrounding related topics.

Submitted by Carlos Correa on

Atul, your point on sustainability and clean tech is interesting. The recent World Bank "Decarbonizing Development" report has this to say "Green innovation may be less well supported by traditional intellectual property rights instruments such as patents and may require additional encouragement". Also according to the "Greening GVCs" paper by Matthieu Glachant and Antoine Dechezleprêtre the role of Intellectual Property Rights on Technology Transfer seems controversial. The paper say " Patents confer upon their owner the exclusive right to make, use, and sell the protected invention for a maximum period of twenty years, during which the patent owner is able to extract profits from his invention. Keeping in mind that the prime goal of IPR is to promote innovation, whether a stronger IP regime fosters the transfer of climate-mitigation technology to developing countries is a controversial issue in international climate negotiations.” Would be nice to discuss more on this

Submitted by Ravi Gupta on

Carlos and Atul,

Your point on clean tech is interesting. Developing nations say they should be allowed to engage in compulsory licensing in clean tech, in which the rights under a patent are granted to a nonpatent holder by a government mandate. As precedent for this practice, they cite the 2001 Doha Declaration on Public Health signed at the World Trade Organization (WTO), which allows poor nations to conduct generic production of patented drugs for HIV/AIDS and malaria to address the pandemics that kill millions each year. The clean tech industries of the United States, Europe and Japan reject this analogy, saying that compulsory licensing would freeze the clean tech innovation process and dissuade investors and innovators from working on new technologies. The clean tech industry’s position is however not entirely supported by economic research that concludes that while IPR plays a different role in clean tech than in life-saving medicines, strong IPR is deleterious to tech propagation and there is evidence to suggest that measures like compulsory licensing help. While in the latter (biotech), patents confer monopolies that enable pharmaceutical companies to drive up prices and produce huge profit margins, the role of patents in the pricing of clean tech remains unclear. The issue of IPR is now a firmly established part of the official UNFCCC negotiating agenda.
Incorporating sustainable development as a treaty objective in international agreements can function as a tool to overcome the structural bias and self-contained nature of international IP regulation. For example, international obligations – especially under TRIPS – should not a priori prevent thinking of flexible solutions to integrate all relevant interests affected by IP protection. The policy space flowing from the sustainable development objective in the Preamble of the WTO Agreement offers adequate discretion for a tailored domestic attempt to give effect to public interests (http://www.ictsd.org/downloads/2011/12/sustainable-development-in-international-intellectual-property-law-e28093-new-approaches-from-eu-economic-partnership-agreements.pdf )
In summary the topic is important but extremely complex and multi-faceted, and a robust discussion is welcome.

Submitted by Tom Kalil on

Stiglitz' position on INTELLECTUAL PROPERTY RIGHTS is indeed fascinating and contrary to conventional notions of facile ( perhaps lazy?) extension of property rights into the intellectual property space. Really enjoyed reading his article on role of considering prizes as incentives. his NYT article on gene patents and monopolization of upstream knowledge is very pertinent to issues related to shared prosperity and income equality. |But on the flip side, is there any literature that gives us converse side of the argument?

Submitted by Ravi Gupta on

Tom,
Yes the argument can be turned on its head and in fact by making a lot of upstream knowledge public, governments can foster entrepreneurship and business models – the weather data example studied by James Boyle et al is a case in point in which he shows how the US generates 39 times more value by allowing free access to weather data than Europe (http://www.ft.com/intl/cms/s/2/cd58c216-8663-11d9-8075-00000e2511c8.html#axzz3TTjkAPKe ) .
As these examples show, IP debate is fairly complex and it is perilous to come up with simplistic arguments vis a vis IPR and economic development or IPR and innovation. Since you found Stiglitz’s arguments fascinating, you may want to read this book “Intellectual Property Rights: Legal and Economic Challenges for Development” by Stiglitz, Cimoli, Dosi, Maskus, Okediji, 2014 ( DOI: 10.1093/acprof:oso/9780199660759.001.0001) . It is a top resource in my view
Furthermore in view of TPP, it is unclear what position on IP would the World Bank take. This 2007 UNCTAD report on Free Trade Agreements (FTAs) by Stiglitz et al. appear to express concern on certain IP provisions https://www.globalpolicy.org/component/content/article/220/47295.html. It would be interesting to look at IP provisions of TPP and further the discussion on the TPP’s IP provisions and WB’s position and role.

Submitted by Rob Merges on

Very interesting debate. the comments are much more enlightening than the blog. To add to Ravi´s point on biopiracy, there was recently an article in newyorker on nutmeg patent. http://www.newyorker.com/tech/elements/who-owns-the-patent-on-nutmeg?mbid=rss

Submitted by James Malackowski on

Interesting discussion. And yes indeed thanks to Ravi Gupta's deep insightful analysis of various issues related to Intellectual Property and economic development, the commentary section is far more enjoyable and enlightening that the blog itself. I am inclined to share Dr. Gupta's skepticism of the effectiveness of America Invents Act to prevent IP trolls. In particular one has to be careful that legal reform doesnt infact land up rewarding non-practising entities such as universities. The recent NYT article on this is instructive: http://www.nytimes.com/2015/10/24/opinion/the-patent-troll-smokescreen.html?_r=0

Submitted by John Villasenor on

Dr. Gupta's insight that business models are perhaps more important and the relevance of liberating data so that new business models can be created is indeed deep and profound. However the usage of open data has its limitations. The recent Economist article discusses that http://www.economist.com/news/international/21678833-open-data-revolution-has-not-lived-up-expectations-it-only-getting

Submitted by Mark Lemley on

For sure the discussion board is far more informative and interesting than the blog. Thanks to Dr. Ravi Gupta for his exhaustive and incisive analysis of all pertinent issues. I agree with Dr. Gupta that excessive property rights may in fact impede knowledge diffusion. I have written extensively about it. Recently there was an interesting article in LA times on how abuse of copyrights laws has led to silly squabbles over many iconic works like Anne Frank’s diary.

http://www.latimes.com/business/hiltzik/la-fi-mh-anne-frank-s-diary-20151116-column.html

The latest book book “Digital Copyright and the Consumer Revolution Hands off my iPod” by Prof Matt Rimmer is interesting and deals with the issue extensively.

Submitted by Ravi Gupta on

Thanks, Prof Lemley. The issues are indeed very complex. Since you bring the scholarship of Prof Rimmer to attention of this discussion board, it may be interesting to read what he has to say about TPP IP issues and sustainable development. I would be interested in seeing what role the World Bank would play on TPP IP issues.
https://medium.com/@DrRimmer/the-trans-pacific-partnership-poses-a-grave-threat-to-sustainable-development-125d4cf1762d#.5l50wpfwc

Also since we are on the subject, I strongly recommend that folks interested in the topic also try reading the newly published book “Indigenous Intellectual Property: A Handbook of Contemporary Research (Research Handbooks in Intellectual Property)”
http://www.amazon.com/Indigenous-Intellectual-Property-Contemporary-Handbooks/dp/1781955891/ref=la_B001JP0QAE_1_7?s=books&ie=UTF8&qid=1451860020&sr=1-7

which deals with treatment of indigenous knowledge from IP perspective. As I argue above, many forms of knowledge are not amenable to the IP system and describe India’s TKDL program.

Submitted by James Bessen on

The recent Google versus Microsoft truce should temper expectations of those arguing greater rights position. I appreciate Dr. Gupta's service to IP and economic development community by sharing this deep nuanced analysis of issues. I have researched the topics last several years and my recent HBR article discusses at length how trolls hurt the economy. There was an article in foreign affairs magazine recently on how licensing requirements impact innovation adversely. Overall I find the argument " Ip helps development" extraordinarily naive

Submitted by Ravi Gupta on

Dear James, Prof. Boyle has written extensively about loss of welfare due to inefficient IP systems. . His book “The Public Domain: Enclosing the Commons of the Mind” discusses how excessive IP laws restrict widespread knowledge dissemination thus stymying scientific advancement and economic development. In view of corrosive influence of money in politics, one could take an even more cynical view the way Crockett takes (his article on how Mickey Mouse evades public domain) wherein he argues that big IP owners rig the game and stymie innovation and economic development. i am NOT persuaded by such a view of capture of institutions though there appears to be strong evidence. furthermore many critics of the excesses of IP regimes in the US extend their argument too far and place it out of context in other nations too and call for weak IP regimes. This, in my view, to use a cliche - throwing the baby out with the bathwater. As i have argued above, in right circumstances, a well functioning IP regime is critical to foster innovation.In ECA countries for instance, which have enormous human capital, lack of well functioning IP systems, have led to underground activity in university-industry collaboration and as a results most researchers are short changed. In such countries I have strongly advocated stronger IP rights especially as they relate to technology commercialization, and legislation analogous to the Bayh Dole Act. Furthermore lack of well functioning IP regime has led to scientists doing a lot of redundant research as scientific findings are never disclosed due to fear of pilferage, and society as a whole cannot advance the scientific frontier by "standing on shoulders of giants" . This critics of IPRs should temper their criticism/opposition and recognize the enormous advantages of a well functioning IP system which is correctly designed to respond to the context.

Submitted by Eduardo Bitran on

Comprehensive analysis of issues by Ravi. Agree with his last point that there is no one size fits all. For the Start-up Chile program, good IP management was key to success. Was a pleasure to work with Ravi in the Balkans where we advocated good IP systems to unlock the potential of scientific prowess in those countries.

Submitted by Bronwyn Hall on

I really find Dr. Gupta’s arguments on traditional knowledge and also on the topic of certain traditional knowledge not being amenable to IP systems of great interest. My research on software patents suggest that software patents have really not helped inventions (http://www.nber.org/papers/w12195 ) and plausibly much of the patenting is defensive ie due to increased activity of patent trolls. However I haven’t really delved too deep on the more fundamental points that Dr. Gupta’s raises about linkages between economic development and all forms of knowledge – only some of which appear to be amenable to the IP regimes. Would you kindly refer me to a good source where I could find more information on this strictly from view of software patents

Submitted by Ravi Gupta on

Bronwyn. You may want to read “ math you can’t use” by Ben Klemens http://www.amazon.com/Math-You-Cant-Use-Copyright/dp/0815749422/ref=sr_1_1?s=books&ie=UTF8&qid=1451860509&sr=1-1&keywords=math+you+can%27t+use

The Brookings review of the book is fairly compendious.

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