Value of Patents in Productivity and Growth
How important are patents to the growth on an economy? A report, ‘Economic Effects of Intellectual Property-Intensive Manufacturing’, by economists Robert Shapiro and Nam Pham throws some light on this issue. According to these renowned economists, most of the value of America’s large businesses can be traced to patents and trademarks. An excerpt –
The creation and adoption of new ideas — in a word, innovation — is a very powerful factor that helps to determine progress of modern economies. Economists trace 30 percent to 40 percent of all U.S. gains in productivity and growth over the course of the 20th century to economic innovation in its various forms. Today, some two-thirds of the value of America’s large businesses can be traced to the intangible assets that embody ideas, especially the intellectual property (IP) of patents and trademarks. Promoting and protecting new intellectual property should be a high priority for U.S. policymakers.
From a medical point of view, this is even more important. As the report goes on to state,
IP-intensive manufacturing produced much more value per employee than non-IP-intensive manufacturing — some $181,000 per worker, per year, compared to less than $106,000 — and in the most IP-intensive industry, pharmaceuticals, an average worker produced more than $425,000 in value every year.