Economics of Innovation and Intellectual Property Rights
Peking University, Fall 2016
Information, Research and Innovation are key drivers of growth and prosperity in the modern economy. Policy makers and entrepreneurs need to understand the economics of research and the roles of various policies in fostering sustained innovation in a world of proliferating intellectual property rights. This course addresses these issues.
We start with the history of research and innovation and the institutions that have supported it since ancient times. We then consider the standard modern economics of invention, introduced by Arrow, Nelson and others; the major types of research management systems; the nature and economic effects of the various modern intellectual property rights; major innovation achievements including examples from agriculture, pharmaceuticals, alternative energy sources, software, and electronics. We discuss the determinants of the direction of innovation, the roles of the public and private sectors, open source innovation, the interaction between innovation and market structure, the role of antitrust, the access of the poor to needed technology, and the challenges of ongoing global intellectual property negotiations.
Students on this class will read and become familiar with some historical examples of the innovation process, and study topics including:
Prerequisite: intermediate microeconomics and introductory calculus.
The main text is Suzanne Scotchmer, Innovation and Incentives. Cambridge, MA: MIT Press, 2004.
Office Hours: After class 9:30-10:30 pm.
There will be a total of five problem sets throughout the semester, one midterm and one final exam.
Each student is expected to submit at least one news item (please, no corporate press releases) analysis related to innovation or intellectual property before the last class. This will be graded with a maximum score of 5%. Good sources include Science, Nature, Technology Review, New York Times, The Economist Science and Technology news, National Science Foundation: Science and Engineering Indicators
In each class, all students will be expected to take an active role in class discussions, and in critically examining the contributions of others. Class participation is crucial for all students. Do not be shy; I have never heard a stupid question from a student yet!
Midterm Exam 25%
Final Exam 40%
News Article 5%
Class Participation 5%