Knowledge economy: what role does intellectual property play in it

Wealth generation through creation, production, distribution and consumption of knowledge and knowledge based products:

•Key characteristics of knowledge economy:

•Consumption of knowledge does not reduce supply

•Law of diminishing returns does not apply, one can use knowledge infinite number of times without reducing its value because of use( it can become obsolete of course)

•Can be stored, and distributed at low cost digitally, infinitely durable,

Characteristics of knowledge economy:

a) The economics is not of scarcity, but rather of abundance. Unlike most resources that deplete when used, information and knowledge can be shared, and actually grow through application.

b) The effect of location is diminished. virtual marketplaces and virtual organizations can be created that offer benefits of speed and agility, of round the clock operation and of global reach.

c) Laws, barriers and taxes are difficult to apply on solely a national basis. Knowledge and information ‘leak’ to where demand is highest and the barriers are lowest.

d) Knowledge enhanced products or services can command price premiums over comparable products with low embedded knowledge or knowledge intensity.

e) Pricing and value depends heavily on context. Thus the same information or knowledge can have vastly different value to different people at different times.

f) Knowledge when locked into systems or processes has higher inherent value than when it can ‘walk out of the door’ in people’s heads.

g) Human capital - competencies - are a key component of value in a knowledge-based company, yet few companies report competency levels in annual reports. In contrast, downsizing is often seen as a positive ‘cost cutting’ measure.

http://www.skyrme.com/insights/21gke.htm

• Three aspects of knowledge economy have implications for our understanding of conventional economic analysis ( Harris, 2001):

– Knowledge creation is an investment activity, like any other investment, it does not come free

– Once created, it contributes to growth of other factors of production, such as capital

– Knowledge accumulates. (In fact some times , learning makes earlier knowledge even more valuable)

• Investment in human capital, our thinking, analyzing and learning faculties matters

Types of Knowledge: tacit ( informal), explicit ( formal); emic and etic, episteme ( theory) or techne ( practice), contingent- episodic or concurrent, meta ( knowledge about knowledge), para or apara gyan, etc.

Arrow(1962) observed:

a) infinite expansability, non-rivalry

your consumption does not reduce supply of knowledge for me

b) Excludability: transaction costs

c) transparency: less than absolute, consumption can not be separated from production process many times, codification, verification, need for tacit knowledge to use the explicit ones,

What do IPRs do?

Positive:

•Reduce transaction costs—ex ante and ex poste for linking innovation, investment and enterprise

•Incentives for private creation of knowledge or production of knowledge with proprietary interests

•Create spillover effects( spatial, sectoral, social, cultural)

•Generate market for innovations, and inventions to bring in potential buyers and sellers together through licensing ( or even piracy with loss of incentives)

•Signaling to society: trends in knowledge economy about where are future demands being estimated, ( uncertainty in domains of knowledge versus uncertainty in domain of applications)

•Creates possible knowledge networks

•Makes it possible for people to survive only by virtue of their knowledge, brings new kind of entrepreneurs in market place

Negative:

•Risk of creating Anti-commons with increasing fragmentation of knowledge

•Disincentives for production of new knowledge ( litigation intensive fields of knowledge may be left out by small firms, small R and D teams)

•Protection of Trivial incremental gains may make developing substantial gains some times difficult

•Broad protection makes subsidiary development of knowledge more difficult, ‘new enclosure movement’;

•Threat to open science culture ( some say due to bayh-dole act in usa)

•Good fences in knowledge economy may not always good friends (Foray, 2002)

Remedies( : compulsory licensing, public pool of private knowledge rights to spur innovations in society ( case of Daguerre’s invention of photography); differential pricing or licensing terms, non-exclusive licensing, cross licensing, Open source technologies ( linux), defensive patents, Collaborative research between public and private sector with social needs and concerns in mind

Do Patents Matter: IP in Indian R & D Institutions and Universities

Anil K. Gupta

www.iimahd.ernet.in/~anilg anilg@iimahd.ernet.in

www.nifindia.orgwww.sristi.orgwww.gian.org

www.indiainnovates.com

BASIC FEATURES OF IPRsPATENT ------ NOVELTYCOPYRIGHT ------- ORIGINALITYTRADEMARK ------- DISTINCTIVENESSTRADE SECRET ------- UNLAWFUL ACCESSGEORAPHICAL ------- REPUTATION DUE TO

INDICATION ORIGINIndustrial designs ------- non functional property of

designINTEGRATED CIRCUITS ------- EMBEDDED

COPYRIGHTS(Software & Hardware)

PLANT VARIETY ------ DUSDistinctivenessUniformity &Stability

Analysis Of Patents Granted to Indians At United States Patent and Trademark Office

1976- July 2, 2004

PATENTS GRANETD TO DIFFERENT STATES OF INDIA FROM 1976- 16th March, 2004 AT UNITED STATES PATENT & TRADEMARK OFFICE

Sr. No.

State No. of patents filed

1. Maharashtra 545 2. Delhi 226 3. Karnataka 251 4. Andhra Pradesh 176 5. Uttar Pradesh 166 6. Tamil Nadu 65 7. West Bengal 61 8. Gujarat 51 9. Kerala 50 10. Haryana 45 11. Himachal Pradesh 22 12. Goa 17 13. Madhya Pradesh 12 14. Others 132 Total patents granted to Indians at USPTO : 1819 * Note : State of the first inventor is taken only into consideration

ANALYSIS OF PATENTS GRANTED TO VARIOUS INDIANS

UNIVERSITIES/INSTITUTES/COLLEGES AT UNITED STATES PATENT AND TRADEMARK

OFFICE FROM 1976-16th MARCH’04

Search key : “University, institute & college”

Search key: “University, institute & college” YEAR-WISE DISTRIBUTION OF PATENT GRANTED TO VARIOUS UNIVERSITIES/INSTITUTES &

COLLEGES AT UNITED STATES PATENT & TRADEMARK OFFICE FROM 1976 TILL 2nd JULY, 2004

YEAR NUMBER UP TO 2nd July, 2004 3

2003 11

2002 5 2001 9

2000 2

1999 6

1998 2

1995 1

1994 1

1993 1

1992 1

1991 1 1988 3

1983 1

1980 1

1979 2

TOTAL 50

CATEGORY WISE DISTRIBUTION OF PATENTS GRANTED TO VARIOUS INDIAN UNIVERSITIES/ INSTITUTES & COLLEGES AT UNITED STATES PATENT & TRADEMARK

OFFICE FROM 1976 TILL 2nd JULY, 2004 SI. CATEGORY PATENTS GRANTED

1 Drugs, pharmaceuticals, medicine and health care 29

2 Industrial chemistry (organic and inorganic) 6

3 Genetic engineering, tissue culture, genomics, etc 6

8 Microbiology 2

4 Laboratory equipments and apparatus 1

5 Biochemistry 2

6 Electrical 1

7 Marine engineering 1

9 Others 2

Total 50

INDIAN INSTITUTES/UNIVERSITIES & COLLEGES THAT HAVE BEEN GRANTED PATENTS AT UNITED STATES PATENT & TRADEMARK OFFICE FROM 1976 TILL 16TH MARCH, 2004

SI. INSTITUTE/UNIVERSITIES TOTAL

1 NII (National Institute of Immunology) 15

2 IISc (Indian Institute of Science) 4

3 IIT 4

7 AIIMS 3

8 IICT (Indian Institute of Chemical Technology) 3

9 International Centre for Genetic Engineering and Biotechnology 3

20 Thapar Institute of Engimeering and Technology 3

4 Delhi university 3

5 Maulana Azad Medical College 2

6 Sree Chitratirunal Institute for Medical Sciences and Technology 2

23 Indian Institute of Cellular Biology 2

11 Dalmia Institute of Scientific and Industrial Research 1

12 National Institute of Ocean Technology 1

13 NEC Research Institute, Inc. 1

14 NIPER (National Institute of Pharmaceutical Education & Research) 1

15 University of Madras 1

16 University Institute of Pharmaceutical Sciences 1

17 Tata Institute of Fundamental Research 1

18 Indian Statistical Institute 1

19 University of Allahabad 1

21 Birla Research Institute for Applied Sciences 1

22 CIMAP 1

20 National Institute of Cholera and Enteric Diseases 1

21 G. B. Pant University of Agriculture & Technology 1

22 Presidency College 1 Search Engine: www.uspto.gov

* Key words: “University”, “Institute” & “College”

STATE WISE DISTRIBUTION OF PATENTS GRANTED TO VARIOUS INDIAN UNIVERSITIES/ INSTITUTES & COLLEGES AT UNITED STATES PATENT & TRADEMARK OFFICE FROM 1976

TILL 2nd July, 2004

SI. STATE NUMBER

1 Delhi 25

2 West Bengal 4

3 Karnataka 3

4 Kerala 2

5 Punjab 2

6 Tamil Nadu 2

7 Maharastra 2

11 Andhra Pradesh 2

9 Uttar Pradesh 2

10 Uttranchal 2

8 Orrisa 1

12 Madhya Pradesh 1

11 Foreign countries 2

TOTAL 50

ANALYSIS OF PATENTS GRANTED TO VARIOUS INDIANS

UNIVERSITIES/INSTITUTES/COLLEGES AT INDIAN PATENT OFFICE FROM JANUARY 1995

-31ST MARCH’03Search key : “University, institute & college”

Search engine: Ekaswa CD – Volume 6 A, No. 1, Database of Patent Applications filed in India (Jan-1995 – 31st March, 2003)

YEAR-WISE DISTRIBUTION OF PATENT GRANTED TO VARIOUS UNIVERSITIES/INSTITUTES

AND COLLEGES AT INDIAN PATENT OFFICE (JANUARY 1995 TO MARCH 31, 2003)

YEAR NUMBER

UP TO 31-Mar-03 26

2002 120

2001 146

2000 88

1999 94

1998 68

1997 76

1996 50

1995 52

TOTAL 720

TOP TEN INSTITUTES/UNIVERSITIES/COLLEGES THAT HAVE BEEN GRANTED MOST PATENTS AT INDIAN PATENT OFFICE (JANUARY 1995 TO MARCH 31, 2003)

Key words: “University”, “Institute” & “College”

Rank INSTITUTES/UNIVERSITIES/COLLEGES PATENTS GRANTED

1 IITs (INDIAN INSTITUTE OF TECHNOLOGY) 240

2 INDIAN INSTITUTE OF SCIENCE 49

3 SREE CHITRA TIRUNAL INSTITUTE FOR MEDICAL SCIENCES & TECHNOLOGY 46

4 NII (NATIONAL INSTITUTE OF IMMUNOLOGY) 42

5 UNIVERSITY OF DELHI 32

6 SIIR (SHRIRAM INSTITUTE OF INDUSTRIAL RESEARCH) 22

7 AIIMS (ALL INDIA INSTITUTE OF MEDICAL SCIENCES) 16

7 TBGRI (TROPICAL BOTANIC GARDEN & RESEARCH INSTITUTE) 16

8 TATA INSTITUTE OF FUNDAMENTAL RESEARCH 14

9 ARI (AGHARKAR RESEARCH INSTITUTE) 13

9 INSTITUTE FOR PLASMA RESEARCH 13

10 NIPER (NATIONAL INSTITUTE OF PHARMACEUTICAL EDUCATION AND RESEARCH) 10

10 CENTRAL INSTITUTE FOR RESEARCH ON COTTON TECHNOLOGY (INDIAN COUNCIL OF AGRICULTURAL RESEARCH) 10

OTHERS 197

TOTAL 720

CATEGORY WISE DISTRIBUTION OF PATENTS GRANTED TO VARIOUS UNIVERSITIES/ INSTITUTES & COLLEGES AT INDIAN PATENT OFFICE (JANUARY 1995 TO MARCH 31, 2003)

SI. CATEGORY PATENTS GRANTED

1 Drugs, pharmaceuticals, medicine and health care 144

2 Industrial chemistry (organic and inorganic) 70

3 Electronics 63

4 Metallurgy 62

5 Mechanical 54

6 Biochemistry 47

7 Laboratory equipments and apparatus 41

8 Genetic engineering, tissue culture, genomics, etc 41

9 Textile (cotton and silk) 34

10 Fuel and energy 33

11 Electrical 24

12 Implements having agricultural uses 24

13 Food stuff 20

14 Microbiology 5

15 Others 58

Total 720

• Let creativity be fostered through judicious combination of open source and proprietary technological innovations

• Let inventors not subsidize the cost of societies’ search for cost effective and novel solutions

• We can patent, publish and disseminate the knowledge, by using patents defensively

• Financial self reliance and autonomy of R and D firms and labs may be facilitated by resource generation through licensing of IPRs

• IPRs are only one of the many incentives required to spur creativity and innovation in society

Make India innovative