Study: 45% of European GDP is attributed to IP-Active Industries, but ‘causal link’ is still lacking

63 million jobs – 29% of all jobs in the EU – are a product of IP-intensive industries, reports a joint EPO-EUIPO study that is strong on findings but according to one observer, weak on causes. 

A further 21 million people are employed in sectors that supply these industries with goods and services. These are among the findings of a joint report released by the European Patent Office (EPO) and the European Union Intellectual Property Office (EUIPO) which analyses the importance of IP rights for the EU economy between 2014 and 2016.

The 45% of EU GDP generated by patents, trademarks, industrial designs and copyrights account for EUR 6.6 trillion or about $7.5 billion.

Trademarks Lead the Way

Trade mark registrations are often indicative of future business success, establishing a company’s brand and underlining its distinctiveness in the marketplace. Industries that make intensive use of trade marks contribute 37% to the EU’s GDP and support 46.7 million jobs. Those industries also pay wages that are 48% higher than industries that do not use intellectual property rights.

Similar findings have been attained by U.S. studies.

For the EPO-EUIPO study, go here

No Evidence of Cause

“Much more could be said about the report,” reported The IPKat, a well know UK-based blog. “It would have been interesting to include the tax revenue obtained from IPR-intensive industries [Merpel notes that this could end up disappointing readers, with one IP-heavy tech giant allegedly owing as much as $14.3 billion in back taxes…].

“But the most important observation should be that the report contains no evidence of a causal relation between IPR and the studied variables, even if they appear to be correlated. The question of how IP causally [not casually] relates to economic growth has been studied for decades. In footnote 24, the report itself notes that there ‘is a rich body of economic literature dedicated to patents’, making it all the more surprising that it does not engage with this literature at all.

“This Kat’s criticism may suggest a lack of appreciation for the hard work of the economists at the EPO and the EUIPO. Not so: as stated above, studies on the real-world effects of IP are very badly needed, and any attempt at it is welcome.

“But these reports form the basis for EU policy, for instance the European Commission’s extremely important 2017 Communication on a balanced IP enforcement system [see footnote 2]. That means critical assessment of these findings by academics – and, ideally, the public – is very important, and it is hoped that this post may form a humble contribution to this debate.”

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