IPR protection in china

posted in: china 0

My people are poor; people in western China are making RMB200 (US$24) per month. Now a bunch of foreigners want me to protect their Gucci handbags? I couldn’t care less.

so represents the views of rural Chinese government officials, according to Ekkehard Rathgeber, President of Bertelsmann Direct Group Asia. (found on china law blog)

this is the economic argument against uniform intellectual property rights protection for all countries: that it prevents some valuable activities that can contribute to a developing economy.

I wrote a paper arguing that patent protection does not make sense for least-developed countries: because the investments that go into imitating goods are far less than those that go into original R&D, it would be much easier for these LDCs to build their economies on ‘copycat’ industries. (and so-called “copies” can often become better as a result, since imitators will adapt their products to be more competitive on the market.)

only once a country has lifted itself out of the ‘poverty trap’ (to lift a phrase from Jeffrey Sachs) can it start thinking about enforcing IP laws–and as a middle-developed country it would be in its own interest to promote innovation and further economic growth (through incentives to innovate). an interesting case study for this is India, who developed a huge industry of copycat pharmaceuticals (they did not until recently protect drug patents) based on mainly American drugs. but on the other hand there was little investment in their own R&D, resulting in far fewer medicines that treat diseases that afflict mainly them.

and of course, once a country becomes highly-developed it will then be a big pusher of IPRs, since these compensate their inventors (an economic monopoly) and protect their innovations.

incentives and innovation vs. imitation and adaptation. all in the name of economics. hmmm.