Here is one proposal to boost productivity growth from a professor at Columbia – basically tighter protections on patent use coupled with more flexible arrangements to share and lease them between parties. It sounds okay, but I have a couple questions.
First, the author sees this as an antidote to “forced technology transfer” from developed to developing companies. If I understand correctly, this is when a factory in a developing country (let’s say China) agrees to manufacture for a developed country firm, but insists they share the legal rights to the technology they are manufacturing, allowing them to possibly cut the inventor/designer out in the future. I get that this benefits the developing country, possibly at some expense to the incentive to come up with further inventions in the developed country. Maybe – but I’d like to see the evidence. Perhaps when the inventor is ready to trade his or her knowledge in exchange for cheap labor and lax regulation, he or she is ready to reap some rewards on the last invention and move on to the next one. I don’t know whether my theory or the author’s theory is more correct, but I have no evidence for either one right now so if I had any hand in policy making I would want to see the evidence for both.
Second, and this is related, the author equates technology with knowledge. That might make sense in certain industries, for example drugs and chemicals. In many other industries, as much or more knowledge exists in the minds of experienced human beings than exists in a written-down form. Many forms of engineering are an example, because engineering by definition is using existing knowledge and experience to solve new problems without completely obvious solutions. If it takes decades of education/training/experience to get an individual to this point, even with the available written-down knowledge, there is not a whole lot of risk if that written-down knowledge leaks out. There is probably also very little value in patenting or otherwise protecting it, and much to be gained by making it freely available.