Understanding innovation and growth

I’ve been dipping into the truly fascinating World Intellectual Property Report from WIPO, published last week. The overview chapter has a beautifully clear overview of economic growth, and the role of innovation and IP rights. The rest of the report falls into two sections: case studies of historical breakthrough innovations (airplanes, antibiotics, semiconductors); and case studies of newer innovations with breakthrough potential (3D printing, nanotechnology and robotics).

The lessons drawn should not be surprising but seem hard for people looking at future growth prospects to absorb. For example, big innovations can affect growth through several routes (for example with antibiotics by the impact on human capital); their economic transformations are far-reaching, unpredictable and can take a long time; all breakthough innovations require continuous follow-on innovations, both technical and organizational; the specifics of the innovation ecosystem matter greatly, and have a geographical dimension; the structure of the ecosystem will change as the technology matures, steadily involving more professional and formal structures. Interestingly, the historical examples suggest that the IP system made far less difference to the wide dissemination of the technologies than the absorptive capacity of each country.

The report is free to download and – unusually for such official reports – a very good read. Its case study approach is illuminating and I learned a lot about the technologies I’m less familiar with.

200 years of innovation

200 years of innovation


2 thoughts on “Understanding innovation and growth

  1. Since I always try to follow your suggestions, specially when the books are free, I’ve started reading it and it does seem like a good read. Skimming through it, however, it seems that it had some of the flaws I sometimes see in WIPO reports. They seem to ignore some of the harmful aspects of intellectual property rights, which can even hinder innovation. A quick search revealed no results for “optimal”, as in “optimal” (“optimize” only appears in a reference to how an invention optimized something). I know you mentioned that IP was not as important for dissemination, but I missed specific references for their potentially harmful role in innovation itself.

    They also seem to equate innovation policy to intellectual property, something that people like Scotchmer try to avoid doing. Do you have thoughts on this?

    • I agree with you of course. Suzanne’s work on this was excellent. However, given their institutional role it isn’t at all surprising WIPO doesn’t say such things. I still enjoyed the richness of the case study descriptions.

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