Evidence-based Intellectual Property Policymaking

By Jeremy de Beer

The intellectual property system is a crucial part of economic policymaking worldwide. It affects matters of profound importance, including health, education, nutrition, culture, science, technology and innovation policy. One might assume, therefore, that the global governance of intellectual property rights rests on a solid foundation of evidence. Think again. For over a century, intellectual property policy has been based largely on theoretical assumptions and political lobbying.

A report commissioned by the UK government in 2010 called upon governments to “ensure that development of the IP System is driven as far as possible by objective evidence.” The Hargreaves report, a high-level enquiry into intellectual property’s effectiveness, became somewhat of a catalyst for change. At least it raised awareness of the need to better understand what constitutes objective evidence for intellectual property policymaking, and to develop methods and metrics for properly assessing intellectual property’s impacts.

In an article forthcoming in the Journal of World Intellectual Property, “Evidence-based Intellectual Property Policymaking: An Integrated Review of Methods and Conclusions”, I identify, synthesize and analyze the most relevant evidence available to policymakers trying to understand the impacts of intellectual property. In my meta-analysis, I include peer reviewed and policy-oriented national and international sources. I also review a range of disciplinary approaches, and cover all major fields of intellectual property from patents to copyrights to trademarks and more.

The paper has been presented at influential events worldwide, including Intellectual Property Statistics for Decision-makers 2016 conference in Sydney, Australia, and the 35th annual conference of the Association of Teachers and Researchers in Intellectual Property in Krakow, Poland.

One of the first problems I address in my work is that researchers from different disciplines have different perspectives on the concept of “evidence” and measures of its reliability. Legal professionals are trained to consider evidence that is relevant and has some probative value; according it appropriate weight based on those factors. Economists, in contrast, favour testing hypotheses against objectively selected quantitative metrics, if based on questionable albeit the best available data and assumptions. Other social scientists might also consider relevant norms, power structures and more qualitative factors.

Reliable evidence is therefore increasingly difficult to recognize, as policymakers are befuddled by reports of what makes their country innovative or how strong IP protection contributes to their country’s economy. Moreover, as Ruth Towse noted in 2013, busy policymakers rarely have the time and resources to understand that existing methods and data simply cannot answer questions like: “What is the value of copyright to our country?”

As a starting point to solve this dilemma, I have thoroughly reviewed and organized existing methodologies and frameworks into four major themes:

Data for advocacy, used primarily by special-interest lobby groups, are glossy-covered reports designed to promote a specific viewpoint. The U.S. Chamber of Commerce’s annual Global IP Center International IP Index—whose 3rd edition was boldly named UP: Unlimited Potential—was designed to promote stronger IP protections for the special interest groups who funded the work. Similarly, the Business Software Alliance’s annual Global Cloud Computing Scorecard purported that the strength of IP protection could determine of whether a country satisfactorily supports cloud computing. Although data for advocacy is accessible to policymakers, the ease of access to reports that are not transparent, verifiable or peer reviewed is a big part of the problem in this area.

Industry Contributions reports present the aggregate economic contributions of alleged IP-industries to an economy. WIPO’s Guide on Surveying the Economic Contribution of Copyright-Based Industries, for example, has been replicated by dozens of countries, including Canada. On the positive side, these reports are often transparent, have consistent methodologies, and have robust, reliable data sources. Nonetheless, busy readers tend to skim the headlines and accept at face value that the studies demonstrate a relationship between IP and IP-related industries. They do not. The size of so-called “copyright industries,” for example, says nothing about the economic impacts of copyright in general or any particular legal or policy reform.

Innovation indices, rankings, and policy reports also benefit from sound methodologies and reliable data, despite the challenge of selecting appropriate indicators on which to base an analysis. The authors of the Global Innovation Index, for example, acknowledge the limits of applying their developed country indicators to developing countries. Furthermore, these ranking systems risk devolving into a statistical horserace rather than an informed investigation. Having more IP outputs may increase a country’s ranking but, as both theory and evidence clearly show, more IP does not mean more innovation and could, in fact, lead to less.

Scholarly theoretical and empirical research and modelling from multiple disciplines gives us insight into the importance of IP for innovation and/or other economic outcomes. Much of the literature relies on patent data, because it is available, detailed, longitudinal, and comparable. Jacob Schmookler (1966), as described in Griliches (1998) and others, was one of the first to promote using patent data as a proxy for innovation. Unfortunately, we know for a fact (via innovation surveys and other approaches) that patents are not a widely popular appropriation strategy. More generally, open innovation and informal innovation requires us to rethink both research methods and policy approaches. My work with WIPO (co-authored with Kun Fu and Sacha Wunch-Vincent) explore the complexities of the informal economy, innovation and intellectual property. Overall, patent-based studies are highly contextual, with results depending on the dynamics of the particular innovation, firm, industry, country or region in question.

This framework of evidentiary archetypes helps policymakers appreciate the advantages and limitations of each approach, since none alone are fully capable of providing complete and reliable information on which to base intellectual property policy.

While the struggle to make evidence-based IP policy is global, developing countries are particularly disadvantaged in finding “evidence” that accurately represents their science, technology, and innovation activities. The Open African Innovation and Research (Open AIR) network, in our recent book Innovation and Intellectual Property: Collaborative Dynamics in Africa, notes that western “IP-related measurement tools for contributions to innovation do not sufficiently consider how innovation and creativity actually happen on the ground in African settings.” Knowledge and Innovation In Africa: Scenarios For The Future delves even further into African innovation, including informal sector innovation, indigenous and traditional knowledge, and open innovation and collaboration. These key features of African science, technology and innovation activity are consistently ignored or undervalued by conventional intellectual property-related metrics. Therefore, policymakers in developing countries often rely on incomplete information to form their IP policy.

Going forward, the task for academics and policymakers alike is to develop methods and metrics to assess impacts in diverse local contexts. Policy making should connect micro (firm) and macro (systemic) economic perspectives. And reliable evidence should situate intellectual property within a framework of innovation ecosystems. At Open AIR, we are currently working to develop metrics that are more appropriate to the African context. Better understanding the kinds of evidence that is currently used as the foundation for intellectual property policymaking is just the start of this ongoing work.

 


Professor Jeremy de Beer is a co-founder and director of the Open AIR network. He is a tenured Full Professor at the University of Ottawa and a Senior Research Associate at the University of Cape Town’s IP Unit. Find him online at www.jeremydebeer.com.

This article and the corresponding working paper are based on a report prepared for Industry Canada by myself and David Arthurs, of Hickling Arthurs Low Canada. Thank you to Hartland Elcock, Alyssa Gaffen and Jeremy Baarbé for their research assistance. Funding to support this research was provided by the Social Science and Humanities Research Council of Canada and the International Development Research Centre.