INTELLECTUAL PROPERTY & ECONOMIC DEVELOPMENT

Intellectual property is a term increasingly use today, but still little understand. To many people it remains an obscure legal concept of little relevance to everybody life.

Intellectual property is a power tool for economic development wealth creation that is not yet being used to optimal affect in all countries, particularly in the developing world.There are two  central economic objective of any system of  Intellectual property protection.The first is to promote investments in knowledge creation and business innovation by establishing exclusive rights to use and sell newly developed technologies, goods, and services.Absent such rights, economically valuable information could be appropriated without compensation by competitive rivals.  Firms would be less willing to incur the costs of investing in research and commercialization activities.In economic terms, weak IPR create a negative dynamic externally.They fail to overcome the problems of uncertainty in R&D and risks in competitive appropriation that are inherent in private markets for information.

The second goal is to promote widespread dissemination of new knowledge by encouraging (or requiring) rights holders to place their inventions and ideas on the market.Information is a form of public good in that it is inherently non-rival and, moreover, developers may find it difficult to exclude others from using it.  In economic terms it is socially efficient to provide wide access to new technologies and products, once they are developed, at marginal production costs.  Such costs could be quite low for they may entail simply copying a blueprint or making another copy of a compact disk or video.There is a fundamental balance of take off between these objectives. An overly protective system of IPRS could limit to social gains from invention by reducing incentives to disseminate its fruits. However, an excessively weak system could reduce innovation by failing to provide an adequate return on investment. Thus, a policy balance needs to be found that is appropriate to market conditions and conductive to growth.Intellectual property rights could play a significant role in encouraging innovation, product development, and technical change.Developing countries tend to have IPRS systems that favor information diffusion through low-cost imitation of foreign products and technologies. Trademarks protect rights to market goods and services under identified names and symbols. Trademarks and brand names must be sufficiently unique to avoid  confusing consumers,these trademarks rights encourage firms to invest in name recognition and product quality. Economists generally believe that the danger of market dominance through abuse of trademarks is slight in competitive economics but such marks could be accompanied by significant market power in countries with the other barriers to entry. 

Thanks,

Muhammad Anas 

Business Consultant
muhammad.anas@adamadvisors.com
+971-507045733


 





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