intellectual property. intellectual property vs standard of living thesis: how to increase your...
TRANSCRIPT
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Intellectual Property
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Intellectual PropertyVS
Standard of Living
• Thesis: How to increase your standard of Living through IPR
• Abstract: Private Vs Government Investment– How do you maintain a Comparative
Advantage in the new communications environment
• Counter Argument :– R&D Tax Credits will the capital to sustain Growth
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What Is Intellectual Property
• Copyrights,patents,trade secrets and trademarks
• Exclusive, temporary and tradable rights
• Enforcement by civil proceedings (IP rights fall to owners)
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Patent and Copyright
• Patent– Length =17 years– Requirements
• novelty
• non-obviousness
• useful– Examination =Yes
– Publication =Yes
– Protection = Claims
• Copyright• Length = 50+years
• Requirements– original
• Examination =Yes
• Publication = No
• Protection = Expression
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Private Vs US Government R&D Funding
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R&D Funding VS GDP
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R&D Funding By Country
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U.S. Patents Granted
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U.S Patents Granted to Non Resident Inventors
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US R&D Tax Credit Policy
US policy:
Definition excludes contract R&D and reverse engineering.
R&D above a base determined by the average of 84-88 R&D is eligible.
R&D depreciated at 100% (the quantity is expensed)
The credit is taxable
Foreign R&D is not eligible
The credit rate is 20%.
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Spillover Effects
• Gap can vary by country– R&D benefits may go to other
countries
• Varies By Industry– Pharmaceuticals– Communications– Semiconductors
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Spillover Effects• Varies By Technology Type
– Pure science• Bohr: quantum mechanics• Basic Genome Mapping
– Goal-Oriented applied research• Edsion: light blub/photograph• electric batteries
– Scientific Discoveries from solving practical problems
• Pasteur: bacteriology via wine research• mathematics for encryption
Prof. Bronwyn H. Hall
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R&D TAX Credit SummaryR&D Tax Credit by Firm Size
Total Assets Amount of Credits No. of Firms Credit per Firm
Under $1m $189 m 4,601 $40,984
$1m-$49m $742 m 8,568 $86,617
$50m-$99m $241 m 717 $335,287
$100m- $249m $312 m 625 $449,939
$250m-and up $5.75B 1,198 $4.8m
Total $7.23B 15,709 $460,604
Source : Internal Revenue Service data for 2000 complied byWashington Council Ernst &Young
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IP Balance of PaymentsNet Reciepts for 2002
Nation Plus US Billions Minus US Billions
US 19.1
Japan 5.7
Germany 6.8
France 3.3
China 5.1
India 0.9
Mexico 2.6
Brazil 0.5
Source: World Bank
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Conclusion• Most Economic Models show that for every
dollar of R&D credit another dollar of private R&D funds is made
• Protection of IP very important to continued growth in standard of living
• Must Balance social costs Vs social benefits• Increase in Government R&D needed to ensure
social and political reform continue• R&D Tax credit provides small entrepreneurs
the opportunity to bring there inventiveness to marketplace