nep-ipr New Economics Papers
on Intellectual Property Rights
Issue of 2023‒04‒24
two papers chosen by
Giovanni Ramello
Università degli Studi del Piemonte Orientale “Amedeo Avogadro”

  1. Breakthrough Innovations and Productivity: An International Perspective By Kuusi, Tero; Nevavuo, Jenni
  2. The Economics of Royalty Rates in Plant Breeding By Adrien Hervouet; Stéphane Lemarié

  1. By: Kuusi, Tero; Nevavuo, Jenni
    Abstract: Abstract In this paper, we shed new light on the productivity impact of breakthrough patents, as well as their role in the variability of productivity across countries. We use text analysis and machine learning–based estimates of the number of breakthrough patents and show that there was a significant drop in quantity in the early 2000s. According to our econometric analysis, the slowdown in innovation activity has a clear temporal connection with the later slowdown in productivity in the 2010s. Breakthrough patents increased productivity on a large scale until the beginning of the 2010s, in particular in industrial information and communications technology (ICT) industries. In sectors other than ICT, productivity growth was more differentiated so that productivity growth is observed in industries that invested significantly in R&D after the emergence of breakthrough patents. We also identify large differences across countries in the link between productivity and breakthrough patents.
    Keywords: Productivity, Innovation, Breakthroughs, Patents
    JEL: D24 O31 O33
    Date: 2023–03–31
  2. By: Adrien Hervouet; Stéphane Lemarié
    Abstract: In the seed sector, for some self-pollinated varieties such as wheat, innovative breeders compete directly with self-producing farmers for commercializing their new seed varieties. The use of farm-saved seed (FSS) can reduce breeders’ incentive to innovate. Several countries have established different royalty systems for both certified seed and FSS to reduce such inefficiencies. In this article, we develop a theoretical model to compare these different systems. More precisely, we compare six different systems by analyzing their impact on the incentive to innovate, as well as production efficiencies at both the seed and agricultural production levels. We show that royalty systems leading to a certain proportion of FSS are welfare improving. The systems leading the highest total welfare levels are those in which the royalty level on FSS is regulated, i.e., either defined directly by the regulator (French or UK systems) or imposed at the same level of certified seed (Australian system). When all economic effects are taken into account, the Australian system performs better with high research costs. Conversely, with low research costs, the best system is either the French or the UK system, depending on the relative cost of producing FSS vs. certified seed.
    Keywords: Farm-Saved Seeds, Intellectual Property Rights, Plant Breeders' Rights, Royalty Rates
    JEL: L13 O34 O38 Q16
    Date: 2023–04

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