Walter G. Park Dept. of Economics American University Program on Information Justice and Intellectual Property Rights, American University, Washington College of Law 16 th October 2012

 Theory (diverse)  Empirical Research (varied)  IPRs can have a positive influence on innovation/inward tech transfer in developed countries, and inward tech transfer in developing countries.  Response of developing country innovation to IPR reforms is mixed. Allred and Park (2007), Lerner (2002), Kyle and McGahan (2012), Maskus (2012), Schneider (2005), and Watson-Phalin (2011) Effect of IPRs:PositiveNegative InnovationAppropriability Costs of R&D Reduced Rivalry Technology TransferMarket ExpansionMarket Power

 Patent Priority Filings (by Inventor Country) Developed Countries 85.9%67.4% Developing Countries 14.0%32.5% Least Developed Countries <0.1% Source: PATSTAT

Rank in 2011Country 1USA 2Japan 3S. Korea 4Germany 5Taiwan 6Canada 7France 8U.K. 9China 10Israel Rank pre-1995Country 1USA 2Japan 3Germany 4U.K. 5France 6Canada 7Switzerland 8Italy 9Sweden 10Netherlands Source: USPTO.gov

 Patent Priority Filings Developed Countries 85.9%67.4% Developing Countries 14.0%32.5% Least Developed Countries <0.1% Developing Countries* 2.4%1.6% * Excluding China, South Korea, and Taiwan

 Business Enterprise R&D Performed Developed Countries 89.1%74.3% Developing Countries 10.9%25.6% Least Developed Countries 0% % Developing Countries* 4.7% * Excluding China, South Korea, and Taiwan Source: UNESCO

TradeFDILicensing Year Developed Countries 71.7%59.4%83.7%75.8%87.1%81.0% Developing Countries 27.7%39.5%16.0%23.8%12.9%19.0% Least Developed Countries 0.6%1.1%0.3%0.4%<0.1% Developing Countries** 20.9%25.7%13.3%20.2%8.6%11.8% * Volumes measured in terms of sums of Export-Import Flows or Outward-Inward Stocks. ** Excluding China, South Korea, and Taiwan Source: UNCTAD

 Lags  Role of Imitative and Adaptive Innovation  Cf. Kim, Lee, Park, and Choo (2011) Research Policy  Barriers to Knowledge Mobility  vs. Open Innovation

present Count of Breakthrough Ideas and Innovations

 Lags  Role of Imitative and Adaptive Innovation  Cf. Kim, Lee, Park, and Choo (2011) Research Policy  Barriers to Knowledge Mobility  vs. Open Innovation  Weak compliance with Article 66.2  Re: Least Developed Countries  Cf. Moon (2008), Barder, Park, and Reynolds (2012)

 Article 66.2  “Developed country Members shall provide incentives to enterprises and institutions in their territories for the purpose of promoting and encouraging technology transfer to least-developed country Members in order to enable them to create a sound and viable technological base.”  Article 67  “In order to facilitate the implementation of this Agreement, developed country Members shall provide, on request and on mutually agreed terms and conditions, technical and financial cooperation in favor of developing and least-developed country Members. Such cooperation shall include assistance in the preparation of laws and regulations on … intellectual property rights..., and shall include support regarding the establishment … of domestic offices and agencies relevant to these matters, including the training of personnel.”

 Having regard to Article 66.2 of the Agreement on Trade-Related Aspects of Intellectual Property Rights (the "TRIPS Agreement"); :  With a view to putting in place a mechanism for ensuring the monitoring and full implementation of the obligations in Article 66.2, as called for by that Decision; :  Developed country Members shall submit annually reports on actions taken or planned in pursuance of their commitments under Article To this end, they shall provide new detailed reports every third year and, in the intervening years, provide updates to their most recent reports.

 Evidence: Impact of IPRs on Developing Country Innovation is not conclusive.  Expansions in innovation & technology transfer are concentrated among a few developing economies  Experience suggests Re: IPRs and Innovation  Need more openness and less exclusivity  Foster adaptive and incremental innovation (as stepping stones) Re: IPRs and Technology Transfer  Need more substantive transfers and policies, and better compliance on the part of Developed Economies