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Week 2

The document discusses the concept of the Intangible Economy, emphasizing the significance of intangible assets such as intellectual property rights. It highlights the importance of investment in creating these intangible assets and their long-term value, particularly in relation to patents. Additionally, it outlines the traits of intangibility, including scalability, sunk costs, spillover effects, and synergies.

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Muhammad Simak
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7 views45 pages

Week 2

The document discusses the concept of the Intangible Economy, emphasizing the significance of intangible assets such as intellectual property rights. It highlights the importance of investment in creating these intangible assets and their long-term value, particularly in relation to patents. Additionally, it outlines the traits of intangibility, including scalability, sunk costs, spillover effects, and synergies.

Uploaded by

Muhammad Simak
Copyright
© All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PDF or read online on Scribd
® r < The Intangible Economy Transcript too Search in video 0:00 0:19 0:24 0:30 0:32 0:38 0:44 We had seen that intellectual property rights manifest on tangible things and that fact that they are regarded as intangible rights over tangible things or physical things. Now, let us look at another aspect which has recently come up. This is the Intangible Economy. Now, scholars are in agreement that there is something called the intangible economy that has come up and we need to see because when we are talking about intellectual property rights, we are essentially talking about intangible rights. 0 Oo q THE RISE OF THE INTANGIBLE ECONOMY INVGAMONT “i n\ TAL (wom Met (Gri rinla Tne (10 NOMG1S > CpP itr ee) ae AKED MAS AS5G1S (Non - Fnvenscel) (tect rtm) \ Pa fiydp Asa businge> tev 1p Be PRODVANE Lo eumenT NM | Granomic RHove w Vv Resov“ces Seen 1° Genige ~ OvOR Bs PERIOD oF Time Cegmtg En DuEINA ®& Perovetive SEeNICES NPTEL (ope nDirttn hesoutets) mr one " "ewe Snore Team Extgnpfveg ——? Long-Tekm Cans ener eS na Pee Pays) AL ep Yon TecnniLola HL 19E HS (Tes) ee Nee NGni Peopuet Desiand (nee) JO ptAG RS — NEN Busings, movers Cesar) v ERD — TRQUe RALATIUAERES (ee, MAES) S CREMING WORLE- PET ae Grey INroRetiOn | Cfocetovi) FEN / 46 oinsratle — TH i oF ang ecONOMY (even te) vnppingec __, Ganonsty Ke caren ntti, Heinen es we, ron forsce) Lo, tii ee Feanne gets ‘so i in HAND OF ow — © Transcript Search in video 224 Forinstance, investment, capital and assets are the things that dive an economy. 232 Now, when we are talking about investments, we arelooking at the spending resources, 299 theresources that are being spent 241 Investments an important thing to Understand because i we understand investment in imangile 249 assets, then we can come up with an argument a5 whether we have an intangible economy 285 atallinthe frat place. 257 fe come'o conclusion that yes there Isinvestment that goes into the creation 303 of intangible assets and intangible assets an tel be regarded as an investment, then 310 wewilbe able to look at this argument in (rater detail and see how intellectual Property 248 fights can operate in an intangible economy, but first let us look at investment through 325 the eyes of the economists. 3:28 Novt investment refers tothe spending that Creates fed assets, 333 Now, we ae talking about non-financial eset 226 We arenot taking about shares or bonds; we are just taking about the fied asset 3:41 thatarenonnancia ‘342 Now this spending could also come from businessee and governments 347 Now, they could alo make this come up with the spending andthe resources spent are towards 2:85 creating enduring reductive services, 1358 Now production as you all know has an Important ‘thing that the economy consiers. 408 Infact, GDP is nothing, but a measure of productivity ofthe county. Ek RS 4:55 / 29:01 < Transcript too Search in video 4:34 So, we understand investment as a resource spent to create enduring productive services. 4:42 Capital is something we all know as wealth that can be owned by people. 4:48 Capital can be considered as a fixed asset providing for productive services. 4:53 So, investment into the productive services can be by way of capital. 4:59 So, capital can be the fixed asset that actually creates these productive services. 5:04 Now, capital in the traditional understanding we can understand capital as wealth. 5:10 So, the fixed assets providing for productive services is what can be is what we can call 5:19 as capital. 0 Oo q Pere fot bet" INVESTMENT eet Comparer (eRvou A) l PRiSge PRAM Patent = INTANGIBLE poset pencoss of _ Lah. 744m 7 PenovetioN Vaive { (renters ina a) Cegatep by & INTANGIBLE IugsTM EN! NPTEL Prien’ Fok A PeVK ~ INVgS mene { funemn Carat (eRvoveee) Yawwe { L = me Eisovncgy) 1 G1 » PATENT prises PRAM "al La Utes =[THTGule AsET Bt a an 2 et fenpverion! go meus). Z cegntep by eThnineL wpsTT (Feces aeseCEE aE Transcript too Search in video 75 7:21 gear, 7:33 7:35 TA4 7:50 7:52 We saw that there is an expectation of value, only then we consider something to be an asset. So, in the case of a patent, there is certainly long term value because if a patent is granted regardless of which country grants that patent, the patent tends to live for 20 years from the date of application. So, the patent has a value so, we consider this process, the producer investing resources on something that arises from a process of production which has got long term value in the creation of a patent. A patent is an intangible asset. 0 Oo q 4065 OF INTANANGLE INvEesTm~NTS InConbrerd invetmestS ——» Labovr Hee OF MenphT} Comfuteeisep isfoa men on) oes s, Of rRrate(, (Gorrumee ¢ prIngnse) AEE peed INNOVATING PROPER Partin, aly Rien , Pasion (EAD, RENSTIC WHOLKS, MBUSTEAAL PcB\ANs) AE NRRLS Patents COPyNGAT (hove EONMIC OMPETENYES ———> MARKS Beeman, Bernipinin, Busi Perit ) NPTEL 4065 OF INTANANGLE INvEesTm~NTs INTONAVBLE invadmMestS —> Lreovk yng oF Teorey | Camtusees sep iseok. en on! Pests, OMyratcl, (Serrnree & peTngnse) Ta Teg PeeS 2 INNOVATING Panrers gaint, Cat Rion , PI ee (040, AeNsTic works, InsvSTEAL OB\aNS) MSIE MALLS PATE COryeNT , RAPE 3 ENON IC anraEnyEgS ——> & MARKS TRAINING, BRANDING, BUSI Revie ) NPTEL 15 CREAM inal, IMarsinbrgs AN Investment 2 InwestongnT —» lost 5 UP ard inegatment ¢ Ss Long THM RAVEN) way Ane FAURN) J plana Bierce InsvenMenst Neen atest; regres (eT) Not invA iments OLbrarsptionAL- CATAL At rinsia by ® NPTEL < Transcript too Search in video 16:30 16:37 16:43 16:44 16:49 16:55 16:57 17:01 Now, if you are able to measure intangibles which would also tell us that you are able to measure the value of intellectual property because intellectual property is a type of an intangible. Now, if we are able to measure the value of intellectual property, then we can attribute value to intellectual property itself though intellectual property valuation is a branch that is growing. Measuring intangibles; so, how do we measure intangibles? Now, there are some difficulties in measuring intangibles because they could be an intanaible 0 Oo q ® NPTEL MGASVAING INA AN @IBLES ). WuGRG sO tnvG Mand 1S INVOLVED — SPILL DVRS —_—— pada anita 2. ND COMRRRAGLYZ MARKT Pag - ot 24 procegustgrs - Cost of 5eNAL0| 2. How TMG 5 Stadt 2-> bone gga iv Gi> IN Unters BLES — graupirity os \Po - 20° I vALuAtion — Mow 0 ming ALSET Ceerep By INVESENT MGASURING IN AN @IBLES ecpTion (Rrysi CAL ) - FALL - DLE ATIC ? el Yana of wets) io one (intarsouBre) - Feel Coreen ons IgeneLi Steisticm BMCERY Pe ce ee R&D vsefuL FoK 10 are eer (mowreres) UK OFFIC OF NATIONRL STATISTICS [ar] @) otek intense - 29 ERRS NPTEL ——— < Sea 23:23 23:32 23:37 23:43 23:50 23:51 23:57 23:59 Jug RISG OF THE Thelntangible Economy Y Torn tiars Transcript rch in video So, this just tells you that though some studies tell us that the life length of an investment Cae AAAS — etHOus Corrtm (2018) wisKe, -& STieesl WESTLAKE aan x is between 3 and 10 years, we find that the products that come out of these investments are able to enjoy much longer protection, that is what we call the term of intellectual property, the time during which intellectual property rights offer an exclusivity to the creator. Now, all this is taken from the capitalism without capital which is a recent book, The Rise of the Intangible Economy. Now, let us look at the cost of Gilead. i Oo q ® NPTEL Ang UM oF GaurgAp’s SONPLON (na-C) CO [Link]/about-sovaldi/what-is-sovaldi ASSOVALDE emer iomna | arcarics | onanee mesos O° KS ABOUT SOVALDI SAFETY INFORMATION SAVINGS What le coven cnahwesntarsoomted fective in adults who hi DI, there's hope t at you can take the known if SOVALDI is safe and etfectiv have cred four AAAs OF IAtanieneiLity I. Scacngier ty 2 SuNkenngss 3. SPILLOSERS 4. SYNERDIES ® — < Transcript Hox Search in video 0:49 _Intangibles: when we talk about intangibles, we are talking about ideas, commercial relationships 0:58 and know-how ideas can be protected, 1:00 The expression of ideas can be protected by the copyright regime, know-how: when it is 1:05 _ translated onto a product which involves a technology that can be protected by patents. 112 Commercial relationships are largely protected by the law with regard to confidential information 1:16 or what we also call trade secrets. 1:19 That is largely the contractual regime. 1:21 Youcan have a contract with a person with to whom you are disclosing relationships, 1:27. Commercial relationships or commercially sensitive information and bind that person through a 1:32 non-disclosure agreement in such a way that a trade secret is protected. 1:38 Now, let us look at the four traits of intangibilty. [NAads ABLES COMngRine RELA TONSHIES ® four RAIS oF SCALABILITY 2. SUNKENNGSS 3, SRLLOYERS INTanGyeiL ty A, SINGROY ES ® ~ $IEEDECEEDEDEERECESESOEEEERISECESEESECEEEDSIESDSSISDISZIDISIEDISIECISISIISISIIOISIIOZL, | < Transcript Search in video 1:48 1:51 1:54 2:00 2:02 2:08 2:14 2:21 2.00 The intangible asset is scalable. The second, trait is sunkenness. The intangible asset is created by cost that is sunk in the sense that you will be hard to recover those costs. The third, trait is spillover: spillover in the sense that when an intangible asset is created apart from the person who created the asset, others get benefit too. And fourth, trait of intangibility is that it can cause synergies having one intangible asset and another asset together can cause synergy which would normally not be the case If tha accate ara nead sanaratahi i Oo q ). SCALABILITY " Capacity - NON LIWAL 3 — Knowl @pmé aoe FWILICAL ROSES HONE PHYSICAL LImetATion S Ex3. NP4eL CLAsses 8 9 [wo a] Wit Ae Nd Lint of jspusTRiare PrPLICATIor! (Prténss) fx. \ 2 SWRQING A book Jee or CAKG Ex. 2: PEPLG in A £00m NO Lmet on 1) SCRLABILITY catacity ~ 7 NON LIVAL ~ KrionL@rne &F9D iapusteine pEeLicntions (Patents) omy &2 Ex3 ® < Smnernm A BOK / PH Cug oF CAKE (OE omnes (AEA GENS. HONE PEOPLE ins A ROOM TnyScaL LamvtATiON > ae Been ee] eee — intone Transcript too Search in video 3:45 3:52 3:56 4:01 4:07 4:10 4:15 4:20 Now, knowledge goods and non-rival goods tell us that there are certain goods that are non-rival in nature especially for this is true for intangible goods. Rival goods are goods which can be used by only one person or a group of people. When a group of people, consume a goods, it is simply not made available for others. For instance, a piece of a cake. A piece of a cake can be shared by a finite number of people. There are limitations to what you can do with a piece of a cake. A book on the other hand can also be read 0 Oo q 2. SUNKENNGSS Lose of CREATION OF Ind FIRST LOY - IRReLERNOLE OT anicensoer wiesponis wists - Lan, vic Pie a GiLeno’s GoNALDI — £\ B\LLION R4d haan To REcoveK TERMS TOOLS NPTEL tm , FRETORY Hy the good times 3. SILLBVERS BEndrirt Mny Reed 40 otmgers - ‘lon - BXCLUPABLE ” IM\ {ation AND COMIN) — ‘fhe - Smal prone caegey pwage may owt tent RLLAKe ReneOe lorurion: GOVANMAT FudPmid (v6.30. 49) Disney - MICKEY MOUSE (14@) —— (2°22) A. SYNGRAIES \eLud ih IRNEIBLES INAOES MEN COmelieD APPLE - GorTuineg Hreoninke + SuPrLY Cnn FoRMLLA + DISTRIBUTION Cocrh-Loia- BRAND, 5 KHEN \9CAS Lome TOAGMER INNoVATION — Wun, MAPraN Suace none — VSR, Pir BnB ® NPTEL otamnd un certhin TY Of oF rng FORK InTAN one’s [. ROSCA 2- Lost gst gongs pisrvtgs ork 1 ® NPTEL otamd un cer thin TY ok ita On BUES t ————, Absa OF ety 2- LOM G5T GON ED —__—_—_—_— piseetds ort ie < Transcript too Search in video 23:21 Now, what is the outcome of these four things? 23:25 So, the outcome of these four traits of intangibility is that one, it causes uncertainty and two, 23:35 it causes contestedness, uncertainty because there is intangibles by the nature 23:44 We saw that because of the sunkenness and because of the spillover that intangibles 23:51 create it is hard to ascertain and derive the value of an intangible. 23:57 Now, Coca Cola may be able to value its brand at a very high price. 24:01 They simply may not be anybody to buy the brand because of its valuation, because of 24:07 the uncertainty that goes into the valuation 0 Oo q POLICY CHALLENGES IN AN INTANGIBLE ECONOMY H PRORITIGS Govghinenty NOCD fo KOOKS ©) Poprrymneaes, gg To UPERHPr?: — wnteneo - If br% 4 rioems (LAN) _ GYNGRAIGS - 10GKS TO CoM fownek _ SURUGNNAS — INVOSTMENT IN INfPNA\BLES GPL LOVORS — PUBLIC INVES INGA T IN INTRnIGIELES Basie, Lescnecn IN _ INGeyPLiNiES— pnecéos To taToTen MEpiCweS Uke }. Conrestep 1 OWINGRSNIE PROMOTES INVESTMENT is INTANGIBLES ince ges inOSTmenT S (een I tions] NE RGpved LYNGRENES Sor (ward a WGMK |p Rants - INTERLOUINE PktGeTS 10-Gum VAnvd PatestS Cleacer \@ e1anTs| & —_ we > improve QuALiTy OF EXAMINATioN TREE ® 1. Conegstep - Le DrinGesnie Meamores INVESTMENT IH INTANGIBLES Imee casio iivEstmerst S a Ee me eon ane Ret Aeneoy OF ME nom, Soran [ROE 1 branes | Inigeouninin eons ~ Fagus dn RESEA NNWE PrtenssS rapeove QUALITY OF EXAMINATION 1 < Transcript SEO Search in video 7:16 The other group which advocates for weak intellectual property rights largely look at the software 7:26 industry and the telecom industry where there are quite a lot of interlocking patterns, 7:31 and say that in these technologies for the technology to grow. 7:36 There has to be a weaker standard of intellectual property right. 7:40 That is the reason why some countries do not offer patent protection for software. 7:46 And similarly for telecoms. 7:48 Telecoms lastly are set by standards and in the telecom sector you have standard essential 0 Oo q J. contestep 1. DrinGesnit PeamoreS INVESMIT IH INTANIBLES mencnse wvesnent’ } [eeean eat JS S eowe sraenones jm Soran AHO Mt Rants ie InfeeLounintn teers ~ 10.6400 S0¢,. ———_ z may» Reacer neve Craoas SMe Quai 0 pemsinasod 4 < Transcript Search in video 9:41 So, intellectual property disputes arise largely because of the fact that the boundaries are 9:48 not clear. 9:49 They could also arise, because of the granting organization say the patent office did not 9:56 doagood job while examining those applications. 10:00 That is another reason why you can have intellectual property disputes. 10:03 One, inherently the patent was not capable of defining the borders of the intellectual 10:09 property right or when the patentgot granted, the examination that went into it was not 10:15 rigorous. 10:16 Now, we will look at a study towards the end of this of this week's course which pertains 10:24, ‘to the Novartis standard. 10:26 We will look at the Novartis case, then we will look at what the standard that was set 2. SYNERGIES |. D-CREMTINA IP 2. Wnoitiony FOR LNOWLANEG To SPeEno ¢ MIX 3. Ens OF 9rStNGSS - SIARA 4 Run nd YORK NO (GoPLE WNELEAATE FORIGG NIP . oo \ LON pon 3. SUNKGANGSS DGSlan OF FintANUAL MARKGTS Ank BROKKS CesreR \R VeLURTION BrQeoninh on If - Informs niBLe BAKED LPRMS © Ganty insGImgnts A. SLL NAS 1. PYBLIC IdNOSIMG TD h49 2. Punvina by Bh nes — Gvoard , Farcapovk 3. Porcey - StmbIver (tater) InvgsTMgn¢ - Ue Govt - IN ReGPRRLM IN UNINASITIES (gue PencweemenT INCRE) NATIONAL Perpomrt? TRIINING 4 EDUCATION Ze NAGEL HRSKAL GT. AL 21 $. Ingavars 17 prignts + acres 1D MGV CANE? | DIFFERENTIAL PRICE — Monotory PRICE FOR DRUMS UNIVERSAL PL 0 < mee Reracn (can PARALLEL IMPORTATION nnd $. ingavars tf Je pragntg + CLO A Agnes DIFFERENTIAL: rece — (monotory PRICE FOR DRUHS Repene CAANE) — PARALLEL IAPORT ATION -~ < Transcript se Search in video 19:19 Now, the reason for pharmaceutical companies involving in setting a universal price is 19:26 that they fear that they could be a reference pricing. 19:30 Reference pricing pertains to price that is set by one government could be used as a reference 19:37 by another government to bargain with the pharmaceutical companies. 19:40 So, they do not want different prices to be used as a point for bargaining and bringing 19:46 down the prices. 19:47 So, they cite reference pricing as one of the reasons why they follow a universal price, 0 Oo q §. inoaones tf 1. paegertg + neuesp To meniemes —— 7 FOR ORS Reraene threreey UNIVELSAL PR og

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