Are intellectual property and patent laws hampering innovation, research and development?

There has been a long standing debate between intellectual property rights activist and those fighting for open data and information, with the former attempting to incentivise innovations and the later promoting free access to the said innovations.

Major companies frequently get into nasty legal battles for rights to claim new technologies, Apple and Samsung being among the most recent.

But the important question of the debate remains unanswered—does withholding technology designs and information hamper progress, or does it bolster competitive race for better products?

There is no one way to answer this.

Former intellectual property lawyer, turned social entrepreneur, Gautam John, weighs in, “Patents are not a proxy for innovation. I'd go so far to say that in many fields of work, excessive patents harm innovation.”

He shares the study by Petra Moser 'Patents and Innovation: Evidence from Economic History'. The paper suggests that patents might not have anything to with innovation after all.

Among the historical evidence it cites, one in particular refers to the intellectual property rights for plants, a move driven by food security concerns in the US, which led to the US Plant Patent Act of 1930. "Breeders of food crops had argued that, in the absence of effective alternative mechanisms, they were heavily dependent on patent rights to recover large development costs. The Stark Brothers Nursery, for example, had built a large cage, armed with a burglar alarm, to prevent competitors from stealing cuttings of the first Golden Delicious apple tree,” it reads.

However, nearly half of all US plant patents between 1930 and 1970 were for roses, suggesting that the 1930 legislation may have missed its target of establishing food security.

John further quotes from the study, “Overall, the weight of the existing historical evidence suggests that patent policies, which grant strong intellectual property rights to early generations of inventors, may discourage innovation. On the contrary, policies that encourage the diffusion of ideas and modify patent laws to facilitate entry and encourage competition may be an effective mechanism to encourage innovation.”

Tracing history
Turns out, patent wars go far back into history, mostly in the US, being one of the first countries to adopt patent laws.

Some of the most common of technologies used today were at one point, the center of dispute among inventors of their time. The Wright brothers aircraft models, for instance, was replicated by the AEA, starting a legal battle in 1903 that went on till after World War I, in 1918 when the suit was finally dropped.

Another popular example can be found in the episode involving Samuel Colt, inventor of the Colt pistols. His conflict with other gun makers dates to as far back as 1853.

Whether the indeterminate nature of these patent wars amounted to better technological progress remains under debate. 

Patent registrations break records in 2013
But despite these argument, the IP registrations numbers remain high. The United Nation's intellectual property agency, the World Intellectual Property Organisations (WIPO), recently reported that their annual international patent applications surpassed the 200,000 mark for the first time ever.

The international agency, of course, sees this as a positive acceptance of the global patent systems and Patent Cooperation Treaty (PCT) and why not? The numbers show that the patent system works allowing applicants to protect their invention in up to148 countries simultaneously.

Francis Gurry, director general of WIPO, asserts with much jubilations, “The new records attest to the importance of intellectual property in the global innovation ecosystem.”

Watch his full speech, here:
 

Sign of progress in R&D?
Many view these as a mark of progress in the global research and development. It is a small indicator of the result of the investments a nation, industry or corporate makes towards research and development.
Chief Economist at WIPO Carsten Fink elaborates, “In general, there is a co-relation between R&D investments by companies and countries, and increase in patent filings.”

“Nationally,” Fink adds, “It is a sign of growing interests in innovations and development.” Citing China's example, he enumerates, “China has rapidly rising investments in R&D over the last few years. And their patent registrations have gone up as well, making them an important member applicant of the last couple of years. They had 21,516 applications in 2013, a rather steep jump from 18,617 in 2012.”

Of the 205,300 applications, 56% of patent applications were from the US while 29% were from China. These numbers represent a 5.1% growth since 2012 which recorded 194,400 applications.

Interestingly, India, with 1,392 applications, is the largest user of the PCT system among low- and middle-income countries.

Although, Fink does admit that every patent might not necessarily ensure uniform productive growth. “Some patents do make greater contributions to progress than others. Similarly, certain industries such as pharma have more ongoing research resulting into more patents” he concludes.