Literature Review

Decent Essays
This paper consists of literature review of previous researches conducted related to the effect of utility model on innovation and technological growth of South Korea, China, Japan, Taiwan, Australia, and Germany. I will discuss the following: how patent and utility model contributes uniquely to innovation and technological growth to countries in different economic growth phase, in terms of total factor productivity (TFP), detailed costs and benefits, and commonality of each type of intellectual property (IP) protection system, conduct case studies on China, South Korea, Japan, and Australia by comparing the trend of patent and utility model application to the level of TFP, discussions about the findings and a conclusion. Patents promote…show more content…
This is a case for social inefficiency. In this case, if charging for access excludes some would-be consumers, the result is waste. The example of AIDS drugs illustrates this point: AIDS drugs are relatively inexpensive to produce. They are sufficiently inexpensive to produce, that the benefits to in lives saved exceed the costs of producing the drugs by orders of magnitude (Foray, 2010). But because of patents, no price competition is permitted and the patent holders (the large pharmaceutical companies) charge such an enormous premium over the cost of producing the drugs – to reap large profits from sales in rich countries – that individuals in many countries cannot afford them. Here is an example where the overpricing has real and enormous social costs.
Empirical analyses of historical data have emphasized the role of patent laws in creating incentives to invent, promoting innovation, and encouraging economic growth (Khan and Sokoloff 1993; Lamoreaux and Sokoloff 1999; Khan 2005). Patent rights affect the process of cumulative innovation by knowledge spillovers which they have to disclose information about patent – it lies at the heart of the recent macroeconomic theory literature on innovation and growth, like endogenous growth models discussed by Grossman and Helpman (1991), Aghion and Howitt (!992), and Acemoglu and Akcigit (2012).
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