Ullberg Speaks to United Nations about Patent Markets, Innovation

by Rashad Mulla

Ullberg Speaks to United Nations about Patent Markets, Innovation

Eskil Ullberg is an expert on patents, technology, exchange theory and intellectual property, and he recently brought that expertise to the international stage by speaking at a United Nations panel: “Science, Technology and Innovation for Development.” More than 100 nations were represented at the Nov. 16, 2012 panel where Ullberg, a visiting research scholar in Mason’s Interdisciplinary Center for Economic Sciences (ICES) and a visiting assistant professor in the Department of Economics, addressed the infusion - or lack thereof - of technology into lower-developed countries.

Ullberg advocated combining the patent system with an educational, social agenda to include more nations in the global economic system and better promote technology building on human capital formation. First, he pointed out that the current patent system, designed to protect the rights of inventors, does not encourage or involve smaller companies as much as large companies. As the system currently stands, large companies engage in substantial litigation with each other for the rights to own a patent, and smaller companies, which cannot match the financial and legal resources of their larger counterparts, tread more carefully when it comes to innovation. And because even smaller, less-developed countries churn out knowledge and ideas at an increasingly rapid rate, using the patent system to link these ideas would put more minds toward solving everyday problems, while allowing smaller companies and poorer countries to reap the financial rewards of innovation.

This leads to Ullberg’s second point: the patent system tends to reward litigious behavior rather than collaboration. As an example, he discussed the recent court battle between Apple and Samsung, in which a California court rewarded Apple $1 billion in damages for borrowing mobile phone design ideas from Apple. He noted that in US patent law, if one company simply accuses another of potential infringement, the accused must disclose, by court order, all of its private information on the issue, paying for the entire process. In Europe, by contrast, the loser of the court battle pays for the costs. 

“The incentives written into law reward rent-seeking litigation and enforcement of the patent system more than negotiation,” he said. “How can we make negotiation more interesting and attractive than litigation?”

The emphasis is misplaced, explained Ullberg: “Companies should be driven by the value of the technology to the economy. How we get there is the question.”

Ullberg has been at George Mason University for six years. He worked for 20 years in international management consulting in Europe, and was invited to come to ICES to study experimental economics with Nobel Prize-winning economist Vernon Smith. He currently teaches in the economics department, and in the spring of 2013 he will lead a National Science Foundation-funded workshop on internationalization and competitiveness. Ullberg released a book in 2011, Trade in Ideas - Performance and Behavioral Properties of Markets in Patents (Springer, 2011). This semester, he is continuing his research on markets and patents, and is authoring a Swedish Research Council-funded study on trust between firms, in which he features 14 companies.

“What the U.N. is doing has the potential to have a huge economic impact around the world,” Ullberg said. “It’s a great honor to have spoken there. We need to keep working to see how we can allow for exchange and tradability between the economic north and south.”

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