This chapter provides an introduction to Intellectual Property, Innovation and Economic Inequality. It begins by discussing the problem of economic inequality, including the scale of that problem, types of economic inequality, and extant research on such inequality. The chapter then outlines the structure of this volume, which is divided into three parts: (1) theoretical, empirical, and policy issues; (2) intellectual property and national inequality; and (3) intellectual property and global inequality.

This chapter criticizes the oversimplification of the binary North–South debate on intellectual property, innovation, and global inequality and highlights the wide geographic, sectoral, and income inequalities within middle-income countries. It begins by explaining why the arrival of these countries has called into question the North–South debate. The chapter then moves from the widely studied subject of global inequality to the underexplored topic of national inequality. Focusing on the intellectual property context, the discussion highlights the considerable subnational variations in the economic and technological conditions of middle-income countries. To combat national inequality, this chapter concludes by recommending interventions in three areas: (1) international norm-setting, (2) national policymaking, and (3) academic and policy research.

Innovation is at the core of economic development, growth, and structural change. Yet, it does not spur in nor flow to all corners of the world. This chapter reviews and describes empirically the uneven geographical distribution of innovation and its dynamics, at both the national and subnational levels. It also compares such distribution in relation to other indicators of economic activity. The chapter then examines the potential consequences of such unequal distribution, particularly for its possible influence on inter-regional income inequality, and discusses how inevitable they might be. In light of available evidence, it explores what the role of policy could be.

Low- and middle-income countries (LMICs) are confronted with a new world order in which the major economic powers that promoted multilateralism have moved toward nationalism, localization of production, and de-legalization of dispute settlement in favor of balance of power diplomacy. A counterpart to this trend is declining interest in developmental assistance. It remains to be determined how countries that are not part of the new great power dynamic will acclimate to this new world. LMICs have the opportunity to leapfrog in the current technological environment. A key challenge is securing adequate capital investment, including through the private sector. There is a trend among the capital-exporting countries to negotiate bilateral and plurilateral agreements with LMICs that preclude regulatory measures requiring technology transfer as a condition of foreign direct investment. Because individual private investors within LMICs may lack substantial bargaining power, these agreements diminish LMICs’ capacity to secure favorable terms for technology transfer. LMICs confront terms of trade that favor high-income countries and, more broadly, the ascendance of managed trade policy among economically powerful states. These factors portend the perpetuation of the marked disparity in the distribution of global income and wealth. There are no “magic bullet” solutions on the horizon.

This chapter reviews available economic theories and empirical evidence about the potential roles intellectual property (IP) rights play in generating or reducing economic inequality, emphasizing international data. Basic evidence demonstrates the simultaneous growth in internal income inequality across countries and increasing IP protection in the prior 25 years. It is tempting to assign causality from IP to inequality but doing so confidently is challenging and has not yet been accomplished systematically. Through encouraging technology diffusion, global IP reforms likely contribute to convergence in average incomes between advanced economies and select emerging and developing countries.

The needs of the global South are proving to be far more complex and challenging to ameliorate than anticipated when the World Trade Organization was established amid promises of enhancing social welfare. In particular, inequality among member states has persisted despite the optimistic projections made during the Uruguay Round negotiations. This issue concerns intellectual property scholars because economic theory suggests that technology policy is a key contributor. After discussing the roles that innovation and international intellectual property protection play within the theory of economic inequality, this chapter focuses on the impact of international patent law. It demonstrates how the demands of the North for ever-stronger patent and patent-like protection exacerbate the problem of technological inequality. The chapter ends with suggestions for ways in which the patent system could be restructured to better enable local inventors to avail themselves of the global knowledge base and enhance the incentives available to innovators who fulfill the needs of the South. In the authors’ view, reducing intellectual property-based inequality in the ways this chapter outlines is a key step toward mitigating the problem of income inequality.

The process of constitutionalizing intellectual property rights highlights absurdities associated with unequal and asymmetrical power relations within the politics of intellectual property and exposes the inherent conflicts between international legal harmonization and unbalanced trade powers in intellectual property constitutionalism. This chapter begins by demonstrating the gap between the mere existence of a constitutional equality provision and its application on the ground. The chapter then examines how inequality is a defining concept in intellectual property that can be articulated in many forms. It discusses intellectual property constitutionalism and highlights the lack of scholarly attention to intellectual property in formal constitutions and the implications. This chapter further demonstrates the incorrect assumption that adding intellectual property rights to a constitution will provide better protection for these rights and discusses how this assumption is predominantly a result of global political inequality and asymmetrical power relations. The chapter evaluates the ideological motivations of countries to adopt intellectual property as a socio-economic right in their formal constitutions. It further introduces and empirically analyzes the results of the collected data. This chapter concludes by discussing the inequality-related consequences of unbalanced constitutional commitments in the intellectual property area.