Correa: Academics Disagree With Assumptions About IP, Innovation And Development

General assumptions saying that intellectual property protection leads to development through the promotion of innovation are not supported by academic research, a well-known professor said last week at the World Intellectual Property Organization. Only countries at a certain level of development can truly benefit from IP protection, he said.

On 4 October, the South Centre held an event on the achievements and evolution of the WIPO Development Agenda. The event was held on the side of the annual WIPO General Assembly, taking place from 2-11 October.

The event featured Prof. Carlos Correa, special advisor on trade and intellectual property at the South Centre and director of the Center for Interdisciplinary Studies on Industrial Property at the Law Faculty of the University of Buenos Aires. He gave an academic perspective on the relationship between intellectual property and development.

The WIPO Development Agenda originated in a 2004 proposal [pdf] by Brazil and Argentina made at the WIPO General Assembly, calling in particular for the necessity to ensure in all countries “that the costs do not outweigh the benefits of IP protection.”

Correa cited a number of publications, such as the United Kingdom Commission on Intellectual Property Rights 2002 report “Integrating Intellectual Property Rights and Development Policy.” The report found that ” Standards of IP protection that may be suitable for developed countries may produce more costs than benefits when applied in developing countries,” he said. Correa was one of the commissioners.

He challenged the conventional assumptions that IP has the same impact in all countries, irrespective of their level of development, that IP benefits always exceed the costs induced by IP protection, and that IP protection automatically translates into development through innovation, and said a number of academics are not really in agreement with those assumptions.

Article 66.1 of the World Trade Organization Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) relating to least-developed countries (LDCs), recognises the special needs and requirements of LDCs, and their need for flexibility to create a viable technological base, he said.

A number of authors have found that historical evidence provides little or no support for the view that IP is an effective method of increasing innovation, he said, citing one of them, a 2007 publication by Michele Boldrin and David Levine “Against Intellectual Monopoly.” He also cited a Cross-Country Analysis of Pharmaceutical Patent Protection, 1978–2002 [pdf], authored by Yi Qian, which found that national patent protection alone does not stimulate domestic innovation, he said.

He further cited a July 2017 publication authored by Dean Baker, Arjun Jayadev and Joseph Stiglitz, entitled, “Innovation, Intellectual Property, and Development: A Better Set of Approaches for the 21st Century.”

Demand for IP Depends on Level of Industrialisation

According to Correa, in countries with low research and development (R&D) intense sectors, such as textiles, food, beverage, tobacco, paper and printing, and wood and furniture, IP law has very little consequence on development and there is virtually no demand for IP protection, he argued.

For countries with medium R&D intense sectors, like chemistry, automobile, non-electrical machinery, there is a little more interest in IP, but it is only in countries with high R&D intensity sectors, such as robotics, pharmaceutical, and scientific instrument that IP becomes relevant, he explained.

Countries need to establish a production profile and if they do not have large sectors of high R&D intensity, IP protection has little importance, in particular patents, because the sector that would need patents does not exist, he said.

The same conclusions can be reached looking at industrialisation stages, he said. For economies where industrialisation is just starting, there is little or no impact of IP on local innovation, but IP may affect access to goods, he added.

When countries reach a state where they can produce incremental innovation derived from routine exploitation of existing technologies, IP still has little impact on local innovation, but IP may reduce the technological diffusion, and affect access to goods, he said.

Once R&D intensive industries are established, according to Correa, IP may help to consolidate local innovation strategies, but access problems will remain for the poorest part of the population, he said.

He suggested that countries should adapt their IP systems to national and sectoral needs by using TRIPS flexibilities, such as exceptions, compulsory licences, and rigorous patentability criteria.

The question remains whether WIPO as a whole is working to achieve development, he said. IP should be used as an instrument but should be used in accordance with national goals, he added.

Development Agenda Needs Renewed Leadership

Viviana Muñoz, coordinator, Development, Innovation and Intellectual Property Programme at the South Centre, said the 2007 WIPO Development Agenda contributed to introduce and maintain the debate on the relationship between IP and development, and IP and innovation.

The question now is how to link the Development Agenda to the United Nations Sustainable Development Goals, as WIPO is a UN specialised agency. She referred to the key findings of the independent external review [pdf] of the implementation of the WIPO Development Agenda Recommendations, and said one of the findings is that there is little knowledge of the Development Agenda at the national level.

The Development Agenda has no expiry date, Muñoz said, and member states should continue to propose development projects. She also underlined the need for renewed leadership from the member states and from WIPO on development issues. She noted WIPO Director General Francis Gurry did not mention the Development Agenda in his opening comments. She also called for the engagement of stakeholders.

Nirmalya Syam, programme officer, Development, Innovation and Intellectual Property Programme at the South Centre, provided the history of the WIPO Development Agenda.

 

Image Credits: Catherine Saez