The Globalisation of Intellectual Property Rights: Four Learned Lessons and Four Theses

Intellectual Property Rights (IPRs) have become ubiquitous in the current debate and have emerged as the key issue of global innovation policy. The 'Trade Related Aspects of Intellectual Property Rights' (TRIPS) Agreement, signed in 1994 as a founding element of the World Trade Organisation, represents the most important attempt to establish a global harmonisation of Intellectual Property protection. The aim of this article is to re-examine critically what has become the common wisdom around IPRs, TRIPS and their effects. We argue that supporters of IPRs in western corporations and governments as well as detractors in global movements and developing countries have overestimated their importance in the process of generation and diffusion of knowledge and innovation. On the basis of some key learned lessons on the nature of innovation and technological change, we assess four theses about TRIPS and its impact on the global generation and distribution of knowledge. Finally, the policy implications concerning international organisations and technological transfer are discussed.

Policy Implications

  • Intellectual Property Rights (IPRs) have emerged as the key issue of global innovation policy: through the 'Trade Related Aspects of Intellectual Property Rights' (TRIPS) Agreement, there is an attempt to impose worldwide a western system of IPRs.
  • Western governments and large corporations claim that strong IPRs are needed to maintain investment in innovation. This position is contrasted by new political and social movements, which assert that muscular IPRs enforcement hampers economic growth and welfare in developing countries. The article argues that both positions overemphasise what IPRs can actually do to promote or obstruct innovation.
  • IPRs per se do not allow companies to appropriate the returns from their innovations unless they are matched to a wide-ranging strategy that includes continuous learning and dynamic innovation.
  • There are substantial cross-industry differences in the role played by IPRs: while patents are quite significant in pharmaceuticals and copyright is important in the audiovisual industry, the majority of sectors are not seriously affected by either strong or weak IPR regimes.
  • In order to catch up, developing countries should put specific policies in place to nurture their absorptive capacity through the creation of appropriate infrastructure and human resources. Competence building is not hampered by IPRs. Developing countries should concentrate on active learning policies to acquire the knowledge of the most industrialised nations.
  • Western nations would better protect their well-being by focusing on promoting new knowledge and creativity rather than by impeding new entrants from accessing the know-how they have already generated.
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