Home > Topics > The Policy and Legal Environment for Innovation > Technology Transfer Snapshots from Middle-Income Countries: Creating Socio-Economic Benefits through Innovation > Editor's Summary, Implications and Best Practices

Technology transfer can improve lives by introducing innovations that directly contribute to improved public health, nutrition, and communications. Less obviously, but more importantly, the polices that promote technology transfer, such as an emphasis on personal rights and education, also promote economic development. Ideally, any positive changes in political or economic climate will create a self-perpetuating cycle: an improved economic environment and a general increase in education levels will lead to improved public health, which will in turn strengthen the economy.

This chapter examines how technology transfer policies can have broad-ranging, positive impact for a nation, raising the standard of living, improving the economy, and opening opportunity. It starts with the story of George Washington, who was not only the first President of the United States, but also one of the first to license new flour mill technology that dramatically reduced the need for manpower and increased the output of high-quality flour. Washington’s licensing of U.S. Patent No. 3 benefited not only its inventor, Oliver Evans, but also the country as a whole: within two years over a hundred other U.S. mills were using Evans’ technology, which boosted U.S. agricultural exports to Europe. On the other hand, when penicillin was discovered by Professor Fleming, the drug was not patented. Since no one could profit from it, the drug languished until World War II dictated its mass manufacture. In short, when the adoption of new technologies is encouraged, more jobs will be created, poverty will decrease, and there will be greater opportunities for economic growth. Indeed, according to Bill Gates, the nature of the global economy increases the need for incentives to innovation given “the economic competition between nations going forward, particularly with regard to the rapid innovation and development in emerging economies … We need incentive systems that drive that innovation in an appropriate manner, because we can no longer compete exclusively on the basis of labor.”

As the chapter then points out, technology transfer is a complicated process, and the journey from exploratory research to successful product can be a long one. R&D falls into three categories or phases:

1. Basic research
2. Applied research
3. Commercial development

Primarily addressing government policymakers, this chapter defines the policy conditions needed for a robust national technology transfer system:

1. Government support of science education, research, and related infrastructure, that will create an enabling environment
2. Rule-of-law protections (predictable laws, fair enforcement, judicial remedies), including those relating to intellectual property
3. A reliance on market forces, which foster informed risk taking and private sector investment, to determine which technologies and products should be developed.

The chapter argues that these three factors are mutually interdependent and should all be present to create a favorable environment for technology transfer.

To support these claims, the experiences of five geographically and developmentally diverse countries with technology-transfer policies are described: Brazil, Israel, Jordan, India, and Ireland. As a result of technology-transfer reforms, each country enjoyed growth in R&D, technology transfer, and economic activity. If one or more of the above three requirements was missing, the country did not advance technologically or economically.

The key lesson offered by this chapter is that the strengths of government and the private sector can be synergistically applied to improve the lives of all of us. Accomplishing this will require strong, consistent support of basic research, robust IP protection, and reliance on market signals for allocating investments in commercialization. Technology transfer works best when there is strong, consistent government support of basic research, including science education and technology-related infrastructure, and robust IP protection. Government policies should also strive to encourage market guidance and private sector investment in applied research and commercialization efforts. In this way, the strengths of the government and the market can be synergistically applied to improve the lives of all.

Key Implications and Best Practices

Given that IP management is heavily context specific, these Key Implications and Best Practices are intended as starting points to be adapted to specific needs and circumstances.

For Government Policymakers

• Core elements of a robust technology transfer system include:
  1) a durable commitment to science education, research, and related infrastructure,
  2) broad rule-of-law protections, including strong IP protections, and
  3) reliance on market forces as the engine for technology transfer.
• Governments have an important role to play in providing an enabling environment for science and technology. This includes education and training opportunities for students (both at home and abroad, and both at the secondary level and at the university level), funding of basic research and early applied research, and support for the physical infrastructure of science.
• Strong IP protections, the ability of individuals to enter into enforceable agreements or contracts with others and predictable and timely judicial remedies enable the negotiation and enforcement of agreements for arms-length technology transfer transactions, both at the national and international levels.
• Strong IP protections support and facilitate inventive activity and the subsequent development of innovations in products that benefit society, for example cutting edge innovations in health and agriculture. This, in turn, fosters continued economic growth which then further drives the process.
• Those governments that have had the greatest demonstrated impact in promoting technology transfer for meaningful social and economic benefits have adopted market-oriented policies that encourage risk-taking and increased private sector investment.

For Senior Management (university president, R&D manager, etc)

• Understand the three phases of R&D (basic research, applied research and commercial development), how these contribute to innovation. Each phase of R&D should be supported within an integrated enterprise that includes best practices in IP management and technology transfer.

For Scientists

• Countries engaged in reforming their R&D and technology transfer efforts are often including royalty-sharing provisions for their university scientists. This provides an incentive for further efforts in R&D, ultimately leading to innovations that benefit society.

For Technology Transfer Officers

• Your efforts are at the center of harnessing the synergy of government investment in basic research and private sector investment in applied research and commercialization. It is at this interface of science and technology, business and law that successful technology transfer can be consistently implemented.