Study 2003: Innovative exporters and intellectual property regimes in selected service industries

The changing composition of the Organisation for Economic Co-operation [OECD] and Development economies, and the rapid growth of trade in services have placed the role of services and services innovation into policy debates on innovation. Despite the increasing importance of the service sector, empirical evidence and theoretical frameworks of innovation in the service sector remains largely underdeveloped.

The study "Innovative exporters and intellectual property regimes in selected service industries: Evidence from the Canadian Survey of Innovation 2003," examines the relationship between intellectual property rights and the performance of firms in service industry sectors. It uses innovative exporting firms as the unit of analysis for two dynamic service industry sectors: information and communication technologies and selected professional scientific and technical.

The empirical analysis in this study is based on data from the Survey of Innovation 2003. The study compares innovative exporters that used formal and informal intellectual property regimes. Formal regimes include patents, trademarks and registration of industrial design; informal methods include secrecy, complexity of design and lead-time advantage on competitors.
This study found that significant differences exist between innovative exporters using formal intellectual property regimes and those using informal regimes.

In the most general terms, innovative exporters with formal regimes had a greater commitment to research and development (R&D) activities and to export activities.

In terms of R&D, they are more likely to have R&D personnel, to carry out both internal and external R&D activities, and to use R&D staff as a source of information.

In terms of export activities, exporters with formal intellectual property regimes are more likely to obtain more than 50% of their revenues from exports. They are more likely to consider the development of export markets as an important factor in the success of their firm.

Exporters using formal intellectual property regimes are more likely to have more novel innovative products than those with informal regimes. This can perhaps be explained by the greater investment in R&D. This could improve the competitive advantage of the firm in the global marketplace.