Table of Contents

The Intellectual Property Debate

The Intellectual Property Debate

Perspectives from Law, Economics and Political Economy

New Horizons in Intellectual Property series

Edited by Meir Perez Pugatch

Intellectual property (IP) has become one of the most influential and controversial issues in today’s knowledge-based society. This challenging book exposes the reader to key issues at the heart of the public debate now taking place in the field of IP. It considers IP at the macro level where it affects many issues. These include: international trade policy, ownership of breakthrough technologies, foreign direct investment, innovation climates, public–private partnerships, competition rules and public health where it is strongly embedded in contemporary business decision making.

Chapter 2: The TRIPS Agreement: The Damage to the WTO

Brian Hindley

Subjects: economics and finance, cultural economics, intellectual property, law - academic, intellectual property law


Brian Hindley INTRODUCTION The WTO presumably exists to increase world economic welfare. It follows that its rules and processes should be structured to ensure that the outcomes of negotiations between its members achieve that end – or, at worst, can plausibly be claimed to achieve it. From that standpoint, the TRIPS agreement represents a failure of the negotiating processes of the GATT, the predecessor of the WTO, which in this respect operated in a similar way to the WTO. The claim that the TRIPS agreement increases world welfare rests on foundations that are much too shaky to support an agreement so strong and prescriptive. The belief that the TRIPS agreement creates, or will create, a transfer of substantial wealth from the residents of poor countries to the residents of rich countries has a much firmer basis. That transfer of wealth plays a major role in justifying the suspicion with which developing countries now view the WTO, a suspicion that has plagued that institution from Seattle to Cancun, and which its supporters should deeply regret. In what follows, I elaborate on these propositions. I then turn briefly to the questions of what can be done and what should be done. ECONOMIC CASE FOR PATENTS There is a broad range of intellectual property rights. They serve different purposes and offer different ownership rights, and each therefore requires its own analysis. In this chapter, in the interests of brevity, I shall discuss patents. Much of the analysis applies without great...

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