Intellectual Property Rights, Term Paper Example

Introduction

Following the deductions of the TRIPS, Trade-Related Aspects of Intellectual Property, Agreement, a lot of literature has been written on the probable benefits and costs of solider Intellectual Property Rights protection (Maskus 187). The benefits and costs are directed towards technology transfer and growth in developing countries. This paper reviews literature on the relationships between protection of IPRs and innovation, economic growth, and technology diffusion. After an innovation or technology has been created, its benefits can be maximized if its application is free at marginal cost. Excessive IPR protection may lead to inadequate dissemination of knowledge, which can slow technology growth. Similarly, weak IPR protection encourages information spillover from domestic firms and other transnational corporations. As a result, a considerable incentive is required at different stages of IPR development to ensure flexibility in the implementation of TRIPS Agreement (Kobayashi and Yu 240).

Intellectual Property Rights and Global Technology

International technology diffusion or transfer enables firms in a certain country access technology developed by its trading partner. Some diffusion may occur in voluntary transactions while others may occur through non-market spillovers or transactions (Kobayashi and Yu 241). The implications of a solider IPR protection on technology transfer are an ambiguous theory that depends on the circumstance of a country. Additionally, it can also restrict transfer of technology since patents can prevent others from expending increased market power and proprietary knowledge of IPR holders (Foster 19). This results in the reduction of knowledge dissemination due to higher prices and lower outputs. IPRs can also play an important role in knowledge transfer since information can be availed through patent claims, which can be accessed by potential investors.

Strong IPR protection encourages technology diffusion through increased trade in services and goods, joint ventures, and technology licensing. Although faced by the problem of theoretical ambiguity, transfer of technology form developed countries to developing countries has potential benefits to both countries (Maskus 187). The developing countries tend to innovate significantly to catch up with the standards of the developed country. Notably, solider IPR protection encourages technology diffusion through various channels. Its influence depends on other factors related to the imitative ability of a country and its level of economic development. Both dynamic and static gains are resulting for stronger IPR protection are necessitated by increased development of products by local firms especially in food products, cosmetics, film production, software applications, and publishing (Kobayashi and Yu 243). It can also increase the ability of a firm to engage in product licensing and joint ventures. The quality of local product and services may rise due to the deployment of additional technology diffusion and development of local products.

Social Benefits of IPR

The importance of technology in IPR for raising living standards and productivity has long been recognized. Technology and innovation progress has raised productivity through the introduction of new intermediate inputs and capital, reduction of costs of production, and improvement of existing goods (Kobayashi and Yu 238). On a broader outlook, technology incorporates changes in organizational structures, production processes, production quantities, and management techniques. Resources to innovate are highly concentrated in advanced countries, which have institutions and requisite skills to innovate and invest in new technologies. As a result, organizations in such countries register large numbers of patents. In countries experiencing low technological diffusion, transfer of technology form frontiers is an important source of increased production (Maskus 189). Such countries can also acquire the new technology through imitation, adaption, and follow-on innovation. IPR protection has a wide scope, and, as a result numerous benefits.

Strengthening Social Goals

IPR protection can also serve in strengthening social goals. For instance, patented innovations and inventions can be disclosed to particular groups or to the entire public to analyzing and improvements (Kobayashi and Yu 251). As a result, independent bodies have a chance to study the innovation or discovery whilst its IP is being protected. This helps in technological progress where the independent bodies have a chance to contribute innovative ideas related to the discovery. It is an important tool in technological dissemination (Foster 20). Independent bodies and technologically advanced countries contribute by providing information on the latest IP technologies. This does not only benefit the frontiers, but also the developing country. It also builds harmony and strong friendship ties, which in turn, leads association in socioeconomic activities such as free trade (Maskus 200). The most effective step is technological transfer. On the contrary, the period of protection expires, which connotes that the invention or innovation is availed for others to access. The team is careful to avoid “re-inventing the wheel.”

Benefits to World Socio-Economies

IPR is critical in world economies that are increasingly dependent on technology and innovation. Today, the innovation economy has gone through major transformations as compared with past-related economies. Most of the new benefits are realized in developing countries as they strive to catch up with top economies. For instance, China is implementing “indigenous innovation” to facilitate both medium and long-term economic development (Maskus 187). The country believes that the indigenous innovation represent the heritage of the country as it pursues new technologies in the market. IPR has played a major role in fostering progress in technology and science. For instance, top economies such as the United States and the United Kingdom have been at the forefront in investing in IPR technologies. After the success of these technologies, they are diffused in the developing counties to boost their economies, which in turn, enrich cultures leading to developed economies (Kobayashi and Yu 253).

Benefits on Law Bodies

IPR is the only legal tactic of converting innovation to moneymaking assets. As a result, Intellectual Property is increasingly becoming valuable for success companies. The enforcement and protection of property rights promote technological innovation, diffusion, and dissemination of technology, which leads increases profitability of law bodies (Foster 22). It also has a mutual advantage to users and producers in a manner, which is conducive to economic and social welfare of a country. On an international outlook, it balances obligations and rights of industrialist since they cannot control the secrecy of their products (Maskus 201). IPR are contained in the constitution and therefore require registration from law bodies. Increase in IP registration implies growth on the country’s economy, and, as a result increase its independence. Additionally, the members passing the IPR laws adopt specific measures to protect public nutrition and health. They also promote public interests in fields of vital importance, which leads to technological and socio-economic development. Such measures must be consistent with the prevision of TRIPS Agreement.

Benefits on Innovation and Entrepreneurs

Occasional failure and risks are the vital signs of the innovative economy. IPR incentivize entrepreneurs and innovators to keep advancing their research in the face of adversities. Reasonably, innovations that stand strong on the face of competition are adaptable to all social and economic conditions. IPR also facilitate information flow through sharing the protected information, which is critical to the original and patented invention (Kobayashi and Yu 256). Information is disseminated to individuals with the capacity to comprehend its entire concepts and make both minor and major changes (Foster 26). As a result, new innovative improvements can be made on the original IP. American researchers have recognized the significance of innovation and its effects in effects in determining the strength of IPR. As a result, many authors and investors have turned to the US Constitution for IP registration, which in turn, has made America the world’s leader in entrepreneurial activities (Maskus 205). This has been facilitated by the overwhelming number of copyrights, trademarks, and patents filed by the US government every year.

Generation of Solutions to Global Challenges

A recent survey has shown that almost all the three hundred products at the disposal of World Health Organization’s essential drug list are critical in improving or saving people’s lives globally. All of them come from R&D extensive pharmaceutical industries that dependent on IPR protection (Kobayashi and Yu 262). This is advantageous since the originality of the drugs is preserved since there are no counterfeit drugs in the market. Additionally, innovative companies in the agricultural sector create new products that help farmers to produce better and more products that the existing technologies. The socioeconomic benefit of this sector can feed the world’s hungry, while at the same time reducing the adverse environmental impacts associated with agriculture (Foster 29). Free trade is eliminated since economies are energized which promote socioeconomic independence. IPR-driven innovations and discoveries in greener technologies and alternative sources of energy help in addressing climate change and improving energy security (Maskus 204). As a result, such countries are protected from world’s major energy crises.

Cost of Intellectual Property Right Protection

The economic analysts of IP have been reconciling incentives since the formulation of property rights that restrict access to vital information. Reasonably, intellectuals have been investing on the name of their brands to enable them to charge an access that may exceed marginal cost (Maskus 206). For instance, patentability offers additional incentives to produce innovations and inventions, but requires that the information to be published before the expiry of the patent. With the rise of economic movements, economic analysis of IP has shifted to more manageable and concrete issues, which concerns patterns of statutory doctrines and common law, business practices, and legal institutions relating to IP. The main issue brought out in this section is Protection of IP and its associated financial implications. Analysts believe that protection of IP is the most valuable asset in an innovative experience (Gu 17). By maintaining high levels of confidentiality, copyrights, trademarks, patents, or designs have become the foundation of successful businesses in the world today. Companies such as Coca Cola, Vegemite, and Disney are the most valuable and recognizable trademarks in the world today. Their success has been enhanced by substantial financial investment, which has proved to be worthwhile. To determine the socioeconomic significance of IPR protection, extensive audits are carried out to determine the cost of protecting each IP. The cost associated with each IP depends on technological investment as well as the quality of protection required.

Patents

Patents re deployed to protect inventions. Registration through patenting gives exclusive rights to exploit the innovation or invention. On the contrary, if the invention is classified as “public knowledge,” no protection is guaranteed (Kobayashi and Yu 265). Patent’s registration fee in many countries includes the initial fee and the annual fees thereafter. Both the application fee and examinations are modest. In the United States, online application costs $520 for a patent of innovative nature and $710 for standard patents (Gu 19). An innovative patent has a lifespan of eight years while a standard patent is complicated and can last up to twenty years. Most of the costs are incurred during the preparation for the compulsory detailed specification. Since each country has formulated its own rules, it is also recommendable to consult an attorney before patenting. In the United States, looking for a qualified patent attorney can be costly. For Example, a patent attorney for a simple to medium patent would cost $20,000 and above.

Trademarks

Unlike other IPs, trademarks do not require registration since one cannot claim ownership of a trademark. The original innovator has the right to use the innovation with no interference from external forces. A registered trademark expires after ten years and can is renewable indefinitely (Maskus 197). Although it is not recommendable, an innovator should claim ownership of innovation through labeling the resulting products. An innovator must pay lawyers or trademark attorneys to help in the process of registration. For straightforward applications, an innovator should pay $1,000 as a consultation fee to the lawyers or attorneys. When registering an innovation in the United States from a foreign country, a handling fee of $100 is required (Bellmann, and Dutfield 200). Additionally, $653 is required as basic fee and another $100 for each individual country where the enterprise may extend.

Industrial Design

Industrial Designs may include shapes of chairs and building and construction patterns, which are registered under the Designs Act (Foster 34). Registration expires after five years. Although registrations are renewable, an innovator is required to register before disclosing the design; otherwise, the right to register is lost. Application and examination fees for registration in the United States are currently at $560 (Bellmann, and Dutfield 196). If one desires protection in foreign countries, it is recommended that one should lodge an application to the secondary country. This increase the cumulative cost of registration since the application has to be lodged through that country’s IP system. The cumulative budget ranges from $5-10,000 for patent or trademark attorney in the country of origin and $10,000 for any other country an innovator may wish to register the industrial design (Maskus 199). Registration in European countries such as UK and Germany is slightly high. As a result, an innovator should engage attorneys in all countries in order to reduce on the cumulative cost of registration.

Trade Secrets

Trade secrets are the most important IPR in many businesses since it contains confidential information (Gu 17). For instance, Coca Cola relies entirely on protecting its products using trade secrets rather than patents. The legal cost of enforcing a trade secret may be tens of thousands of US dollars. On the other hand, an enforceable contract is not worth the paper where it is written, but its long-term profitability. The legal cost of preparing a suitable agreement varies depending on the details of arrangement, which reflect the degree of sophistication of each arrangement. To ensure proper protection of trade secrets, all contractors, employees, and other stakeholders must sign the desired confidentiality agreements, which are sometimes referred as Non-Disclosure Agreements, NDAs (Bellmann, and Dutfield 193). These agreements are either part of contractor services, employment contract, or a specific and separate confidentiality agreement. Notably, trade secrets protect a valuable right, which cannot be recovered after being lost. As a result, individuals seeking trade secrets should seek legal advice from a trademark or patent lawyer or attorney with the IP law.

Copyright

Copyright are used to protect the original expression of concepts, not the concepts themselves. Copyrights apply to original artistic works such as music, literature, films, broadcast, sound recording, and computer programs. Copyrights have wide applications because they do not need formal registration in the central register (Gu 18). It is one of the cheapest IPs since its protection is automatic in nature. Innovators and entrepreneurs are advised to use copyright’s notation. Notations notify other parties on the repercussions of claiming ownership of the material with the notation. Many investors overlook ownership of copyrights in products produced by contractors and employees. Investors should understand that copyrights do not always exist in the business or the employer. Contractors and employees must make agreements with the employer or business to ensure that the business’ copyright encompasses their services to the company (Kobayashi and Yu 269).

Conclusion

From the findings of this study, Intellectual Property Rights contribute greatly to national and state economies. Many industries and firms across the world rely on the sufficient enforcement of their trademarks, patents, copyrights, industrial designs, and trade secrets to safeguard the security of their products or services (Foster 19). Notably, consumers also use IP to ensure that their purchases are safe and of the right quality. IPR protection ensures that a product is safeguarded from its competitors to avoid duplication. IPR protection may be expensive at the initial stages, but later turn out to be the most valuable asset in the innovative experience.

Works Cited

Bellmann, Christophe and Dutfield, Graham. Trading in Knowledge: Development Perspectives on Trips, Trade and Sustainability. London: Routledge, 2013. Print.

Foster, Neil. The Role of Intellectual Property Rights in Technology Transfer and Economic Growth. UNIDO, United Nations Industrial Development Organization, 2006.

Gu, Weishi. The Impact of Foreign Intellectual Property Rights Protection on US Exports, FDI, and Licenses. Miami: ProQuest LLC, 2008. Print.

Kobayashi, Bruce H. and Yu, Ben T. An Economic Analysis of Performance Rights: Some Implications of the Copyright Act of 1976, Research in Law and Economics, 17, 237-270, 1976.

Maskus, Keith E. The International Regulation of Intellectual Property. Weltwirtschaftliches Archiv/Review of World Economics, 134(2), 186-208, 1998.