Innovation and creativity are essential for sustainable growth and economic development.  Several core conditions enable innovation and encourage economic growth: strong standards and effective enforcement of intellectual property protection, vigorous competition and contestable markets, open trade and investment in a stable economic environment, a strong and sustainable fundamental research and development infrastructure, sound policies and mechanisms to promote the science-innovation interface, efficient and transparent regulatory systems, ethics and the rule of law, and a strong emphasis on education at all levels.
Intellectual property protection is one of the central public policy pillars on which the knowledge-based industries and global markets of the 21st Century rest.  Rapid changes in key technological, policy, and social drivers all underscore their growing importance. Intellectual property rights (IPRs) provide an increasingly critical legal and policy toolkit for spurring innovation, for stimulating the investments needed to develop and market new innovations, and for diffusing technology and other knowledge in socially beneficial ways. Sound framework conditions for a well-constructed IPR regime, therefore, are indispensable.
Nonetheless, certain policymakers, non-governmental organizations, academics and others have questioned the role of IPRs in the emerging 21st Century economy.  Some simply oppose the role of property rights and the primacy of market-oriented economies on ideological grounds.  Others question the “social contract” associated with granting and promoting intellectual property rights when compared to public sponsorship, government subsidies or other government-directed tools. Still others oppose the underlying technological advances and global market competition that are taking place and, therefore, conclude correctly that IPRs play an important role in creating and sustaining these developments which they view negatively. Finally, some others recognize the importance of IPRs but argue that intellectual property rights increasingly retard, rather than promote, innovation and economic growth.
In this discussion paper, BIAC summarizes an affirmative case for why a well-developed, carefully balanced system of intellectual property rights provides a fundamental foundation for promoting and achieving sustained creativity, innovation and economic performance in the 21st Century.  The first section highlights the importance of IPRs in meeting today’s and tomorrow’s key economic and technological challenges.  It identifies some of the driving forces and challenges that demonstrate the importance of intellectual property rights and the need to get the legal and policy framework for IPRs “right”.  The second section draws upon this forward-looking, affirmative case for IPRs to suggest the pivotal role that the OECD should play and to recommend a proactive, multi-point OECD work program related to intellectual property rights over the next few years.
This paper has been prepared for the Ministerial meeting of the OECD’s Committee for Scientific and Technological Policy (CSTP) in January 2004. It also, however, should be of equal interest to policymakers in national governments, other OECD Committees and the wider business community.