The implications of improving software IPR protection on the knowledge economy’s four pillars framework
Source: The World Bank, Ernst & Young
Further strengthening software IPR protection in China can lay the foundation for the country’s drive towards the knowledge economy.
Further improvements in software IPR protection would not only generate economic benefits for China, they would also result in intangible or indirect benefits that can impact the economy, and the country as a whole.
While the value of these intangible / indirect benefits1 cannot be easily quantified, a key characteristic of these benefits is that they could contribute to China’s transition to being a knowledge economy2, which is a priority of the Chinese government.
The government is keenly aware that China needs to continue building the foundations for a knowledge economy in order to remain sustainable and competitive in the global arena over the long-term.
Four pillars framework
In order to make the transition to a knowledge economy, China can design its transitional strategies based on the recommended “four pillars” framework. These four pillars are defined as3:
- Economic and institutional regime – an economic and institutional regime that provides incentives for the efficient use of existing and new knowledge and the flourishing of entrepreneurship
- Educated and skilled population – an educated and skilled population that can create, share and use knowledge well
- Efficient innovation system – an efficient innovation system of firms, research centers, universities, think tanks, consultants and other organizations that can tap into the growing stock of global knowledge, assimilate and adapt it to local needs and create new technology
- Dynamic Information and Communication Technologies (ICT) infrastructure – ICT that can facilitate the effective communication, dissemination and processing of information
Intangible or indirect benefits
The implications of improving
software IPR protection
on the knowledge economy’s
four pillars framework
Intangible benefits can manifest themselves in various forms:
- Increased innovation and creativity
- Productivity gains
- Time savings
- Quality of foreign investment dollars
- Quality of domestic investment dollars
- Change in mindset towards unlicensed usage/ IPR infringement
- IPR reputation of a country
In essence, the intangible or indirect benefits that would be derived from further improvements in software IPR protection in China can assist in building these four pillars in a knowledge economy.
1 Intangible / indirect benefits are defined here as the benefits for which direct economic value is difficult to quantify, but which nonetheless have an impact on the economy in a different form.
2 A knowledge economy is defined by The World Bank as one in which “organizations and people acquire, create, disseminate and use knowledge more effectively for greater economic and social development”. A knowledge economy allows a country to develop more efficient ways of producing goods and services, which in turn results in more effective and affordable delivery mechanisms to a larger group of people.
3 Source: The World Bank
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