Professor Mario Kafouros, Chair of International Business and Innovation at Alliance Manchester Business School gave a speech at a recent Distinguished Professor Seminar Series in Hong Kong. Professor Kafouros spoke about Intellectual Property (IP) laws and their impact on a firm’s profitability.
The Institute of International Business and Governance (IIBG) invited Professor Kafouros to speak at their Distinguished Professor Research Seminar Series. The latest series of events focus on the theme: Beyond Covid-19: Rethinking the future of business. Professor Kafouros delivered a speech about his recent research into the relationship between IP protection, innovation and economic returns, titled: "See you in court? Protecting Intellectual Property in the Global Economy.”
The research was inspired by the established agreement that a firm’s ability to profit from their technologies depends on the strength of IP laws. What Mario's study seeks to show, in his words, is: “that profiting from technology is also determined by how effectively firms engage in patent infringement litigation (i.e. taking legal action against their rivals) to create isolating mechanisms and protect their technologies.” His study also shows that patent infringement litigation is specific to industries and geographies, which disproportionately affects revenue-generation and costs and, therefore, its net effect on firm profitability. Mario summarised his findings: “The study helps us understand why innovative firms experience different profitability outcomes, through identifying contingencies that influence the economic returns from patent litigation.”
Professor Kafouros also serves as the Associated Head of Research in Alliance Manchester Business School. He holds extensive industrial and academic experience in the fields of innovation and international business and strategy as well as wider knowledge from disciplines such as economics, geography and law. His wider research into the forces driving innovation, internationalization and firm performance in the global economy informed his speech at the event. His other research interests concentrate on the consequences of international strategies for firm competitiveness and the mechanisms enabling multinationals to benefit from technological development.
The event took place virtually on 21 October, with an audience comprising of over 65 academics and researchers. Mario's speech was followed by an extensive Q&A session, where he answered engaging questions such as, “how can firms protect their technologies in countries that are characterised by weak legal protection?” and there was also discussion about the role of IP protection in emerging countries such as China.
Reflecting on the event and his research, Mario said: “I thoroughly enjoyed the session, and I very much appreciated the enthusiasm and participation of everyone. One of the biggest takeaways is that IP protection has two faces. On the one hand, strong IP protection motivates organisations to invest in innovative activities by increasing the economic returns to such activities. On the other hand however, we should keep in mind that technological advance is an evolutionary process that requires people and organisations to use and combine prior ideas and technologies. Hence, if IP protection is particularly strong, it can lead to the underutilisation of existing ideas and technologies and in turn decrease the rate of innovation”.