National Innovation Systems

Presented by Team 4:Xindi LiHerlinna ChungLina LiuAlix LinakerKatrina Cheney

Agenda

Backgroud and Brief Summary Reflection Industry Application ConclusionReferencesQ & A

Background and Brief Summary

“International Patenting and Less Developed Countries” (1973) by Edith PenroseBackground

Globalization and advanced technologyDeveloping countries and Union for the

Protection of Industrial Property

Background and Brief Summary

SummaryCosts and benefits of granting foreign

patents in less-developed countriesBenefit: technological transfer &

foreign investmentCost: monopolistic and restrictive

effects

Background and Brief Summary

Leveraging Knowledge Across Geograic Boundaries ” (2007) by Stephen Tallman & Anupama PheneBackground

Information era Knowledge as valuable resourceContinuous innovation

Background and Brief Summary

Brief SummaryKnowledge transfer within clusters, between

clusters, and between countries International knowledge transfer depend more

on the originating firm innovativeness than recognized value and prior firm knowledge flows

Reflection on Penrose’s Article

1st argumentPatents were a valuable aid to less-

developed countries' development and assisted the spread of technology

2nd argumentGranting foreign patents can restrict the

transfer of technology as the competition among other sellers of technology is reduced

Reflection on Penrose’s Article

The article against 1st argument and supporting the 2nd argument “Foreign Patent Monopolies in Developing

Countries: An Empirical Analysis” (1976) by Helge E. Grundmann

Helge states that the main reason why foreign patent should be granted is that the company aims to be protect its imports from imitators'. Also, the article rebutted the popular belief that patents will be beneficial to the development through transfer of technology to developing countries

Reflection on Penrose’s Article

2nd argument further supported by "Patents Revisited: Their Function in Developing

Countries" (1972) by Vaitsos Patents seem to act as an obstacle to the

transfer of technology to developing countries, and that patents restrict local technological development through imitation and adaptation.

Reflection on Tallman and Phene’s Article

Argument: Domestic firms have an advantage in acquiring

knowledge spillovers within the country

Supported by the articles: “The Role of Culture on Knowledge Transfer:

the Case of the Multinational Corporation.” (2006) by Lucas Leyland

"International Transfer of Knowledge: The Role of International Trade and Geographic Proximity” (2002) by Fredrick Sjoholm

Reflection on Tallman and Phene’s Article

Finding and conclusion from the articles: Geography may create boundaries, but it is the

underlying economic and institutional structure and microeconomic linkages that are significant in generating innovative activity and knowledge spillovers

Reflection on Tallman and Phene’s Article

Leyland suggests: The location of the countries will significantly impact

the possibility of knowledge transfer between them.

Sjoholm suggests: Regardless of geographic proximity, both

knowledge and technology transferred from developed countries to less-developed countries will assist economic development in one way or another

Knowledge Transfer Benefits

Possible benefits of knowledge transfer to less-developed countries

Change in productivityCreate new profitsBuild relationshipsReduce risksSave time and costs

Barriers to Knowledge Transfer

Generational differencesLack of incentivesLack of information and communication

technologiesGovernment regulations

Industry Application

“Protection of U.S. Patent Rights in Developing Countries: U.S. Efforts to Enforce Pharmaceutical Patents in Thailand” (1994) by Stefan Kirchanski

Industry Application

Helge: Patentees do not intend to come into licensing agreements in developing countries because of their inferior industrial developmentU.S. drug industry will not increase

investment in local R&D

and production facilities in

Thailand

Industry Application

Tallman and Phene: Underlying economic and institutional structure are important to generating

innovative activityThailand's economic and political conditions lead to prevalent pirating activities

Conclusion

1. Foreign patenting can not help to stimulate developing country’s economic development nor assist technology transfer.

Geographic proximity affects knowledge transfer.Patenting systems act as an interesting and useful

dimension to compare different countries.

References

Helge E. G. (1976). Foreign Patent Monopolies in Developing Countries: An Empirical Analysis. The Journal of Development Studies, 12(2), 186-196

Kirchanski, S. (1994). Protection of U.S. Patent Rights in Developing Countries: U.S. Efforts to Enforce Pharmaceutical Patents in Thailand. Loyola of Los Angeles International and Comparative Law Review.  16(2), 569-608 Retrieved from http://digitalcommons.lmu.edu/cgi/viewcontent.cgi?article=1332&context=ilr

Leyland, L. (2006). The Role of Culture on Knowledge Transfer: the Case of the Multinational Corporation. The Learning Organization, 13(3), 257-275

Penrose, E. (1973). International Patenting and Less Developed countries. 768-785

Sjöholm, F. (2002). International Transfer of Knowledge: The Role of International Trade and Geographic Proximity. Weltwirtschaftliches Archiv, 97-115

Tallman, S., Phene, A. (2007). Leveraging Knowledge Across Geographic Boundaries. Organizational Science, 18(2), 252-260

Vaitsos, C. (1972). Patents Revisited: Their Function in Developing Countries. The Journal of Development Studies, 9(1), 71-97

Any Questions?