Panel III 16:30-17:30 Competitivity of Knowledge Economies

Questions

• How can EU become "the most competitive knowledge economy by 2010"?
• What EU policy goals have been formulated, by whom, with what understanding?
• Which factors affect Europe's "competitivity" compared to US, Japan, India etc
• How do public and private research and patents influence "competitivity" of Europe?
• The Commission Recital 16 claims that software patents would improve Europe's competitivity with respect to its main trading partners. JURI and Council add a new rationle which says that Europe's competitivity is improved mainly with respect to "low-cost economies" (e.g. China, India, Russia, Poland, Hungary, ...), to which currently manufacturing processes are being shifted. Can these claims be verified?

• The Irish Presidency has spelled out "competitivity", raising percentage of research expenditures in GDP to 3%, increasing private R&D, strengthening public investment in network infrastructure, ... centralising the patent system, securing "protection" of "computer-implemented inventions" etc as policy goals, see links in Ireland and software patents. What is driving these policies, on what rationales and interests are they based, how reliable are the comparative statistics (e.g. on R&D expenditures in regions) which they cite?

Participants

Birgitte Andersen (IPR policy research, Birkbeck University of London, UK), J. Bessen (MIT, USA), Y. Meniere (Cerna, FR), T. Noisette (TemPS Reels, French Socialist Party, FR), S. Perchaud (Europe Shareware, FR), J.P. Smets (Nexedi.com, FR)

Chair

Daniel Cohn-Bendit MEP (Chairman of Green Group, France-Germany)

Shadow Chair

Sylvain Perchaud (MD of Europe Shareware)

Abstracts

Birgitte Andersen (Birkbeck University of London, UK)

Title : IPR Policy for Business and Society.

Abstract :

• The speech will emphasize how we need to bring interdisciplinary research and social responsibility into the consideration of intellectual property rights (IPRs). It also will highlight how cross-institutional dialogue between the researchers and the designers, owners and users of the IPR system is the best underpinning for both informed research and informed IPR policy. Three research priority themes are discussed. i The rationales, operation and effects of IPR regimes: The speech will address the policy goals for IPRs, and then discuss if the system really performs in relation to its objectives. ii The evolution of IPR regimes setting the rules of the game in the knowledge-driven economy: The speech contributes to an understanding of the changing role of IPR regimes, as the main institution setting the rules for the game (or forms of competition) for business and society. iii Governing value and rent (or profit) creation and distribution from IPRs: The presentation will emphasize how collaborative innovation networks within sectoral systems are increasing in relevance and complexity, and that IPR policy therefore must not be based upon 'too exclusive' rights.

Yann Ménière (Cerna, FR)

Abstract :

• In the first part of the presentation, I argue that assessing correctly the economic impact of software patents requires taking into account some important specificities of the software technology. The traditional economic wisdom about patents is that they promote innovation. Patents

  indeed provide an incentive to invest in R&D and they facilitate the trading of knowledge. They may however also impede innovation in some particular cases, namely when innovations are complementary and cumulative. Innovations are cumulative when they result from each other, and complementary when they are embedded in several broader technologies. This is typically the case of software, where routines and subroutines are regularly improved and re-used. The economic problem with such interdependent innovations is that as one final software product may embody several, and eventually a lot of, different patents belonging to different owners. The need to identify these patents and to strike a deal between all their owners creates uncertainty and yields significant additional costs on innovation. This problem is worsened if the patent office is not able to implement correctly the patentability requirement. This is the case in the United States where it has resulted in a flood of weakly inventive software patents with claims of high generality.

Sylvain Perchaud (Europe Shareware, FR)

Abstract :

• The Silicon Valley entrepreneurs have always benefited from large investments of Venture Capital (VC) funds. In fact the Silicon Valley is said to be one of the most liberal place of the planet, thanks to near-zero tax on the benefits made by VC funds. Why is european venture capitalism so weak in comparison ? Why is IT the poor relation of EU investors ? In regard to the latests EU engagements in favour of innovation, we'll discuss the solutions at hand to encourage investment in IT companies.

Jean-Paul Smets (Nexedi, FR)

Abstract :

• European protection system for software innovations has always excluded the enforceability of software patents. This situation raises concerns regarding the competitivity of European vs. US economy where the patent systems are different: is it a competitive advantage or a disadvantage for the European economy to be based on a different system than the United States ? is it a competitive advantage or a competitive disadvantage for the United States economy to be based on a different system than Europe ? Our presentation will discuss the relative competitivity of interacting markets based on different patent system. We will study market barrier effects and segmentation of innovators.