Article

Property rights
and public research

SERGIO SALLES-FILHO

O The topic of public-private relations is recurrent and, as such, comes up from time to time. How to analyze public-private relations in knowledge production? How should public organizations relate to the market? Why demand property rights for a cultivar developed by a public research institution? What does university have to do with technology commerce? Are these practices justifiable from a social point of view? These and other questions have always been present in the laboratories, rooms and corridors of public research and teaching organizations.

In science and technology, everything that is widely publicized will bring the best and greatest social benefit, right? Wrong, not everything, not always. It depends on a set of non-trivial factors. Similarly, everything that is privately appropriated will restrict social benefits, right? Wrong, it also depends on a certain set of variables, essentially the same ones that justify the previous statement.

In science and technology, as in everything that involves knowledge and learning, the conditions of appropriation vary considerably. Usually, those who already know something about what is being disclosed benefit more. As the levels of knowledge, information and skills to deal with knowledge and information are, by definition, unequal, it is reasonable to expect that the appropriation of knowledge will also be unequal. And this is regardless of the existence of any formal appropriability mechanism (eg patents, copyright, breeder's rights, etc.).

A world free of property rights could produce as much knowledge as possible and this would not necessarily result in widespread social appropriation of benefits. Likewise, a world full of property rights would not be capable of generating wide-ranging social benefits. The relationship between appropriability and social benefit is neither direct nor simple. Basically, individuals have different abilities to acquire new knowledge. As a general rule, the most qualified will do so more quickly and successfully, often increasing the distance between them and the less qualified. In these circumstances, disclosure without criteria may result in a worsening of the socio-economic conditions of a given set of social actors.

This is made worse if there is a regulatory framework that provides for property rights (a world like ours, with established and widely accepted property rights). If you don't want to appropriate a given piece of knowledge, don't be fooled, because someone will do it, using all the existing institutional apparatus (de jure or de facto).

An eloquent example was what happened with agricultural technologies during the historical moment that was conventionally called the Green Revolution (mid-1950s to early 1970s). Based on the development of high-yielding varieties and so-called chemical and mechanical inputs, the Green Revolution was a broad (and open) process of diffusion of a new technical-economic standard for agriculture, later known as the productivist standard.

Less developed countries were explicit targets for the dissemination of this standard. Although there were initiatives to educate farmers on the use of technological packages carrying the new standard and investments in public research and extension institutions, the adoption of the new knowledge was essentially irregular. And it was not because the research and technical assistance institutions failed (they may have failed, but the blame cannot be attributed to them without mediation), or because the information did not reach everyone equally. Socio-economic inequality grew in most regions and heterogeneities became more pronounced.

In fact, the production base was already deeply heterogeneous. Heterogeneous in its technical capacity, in its socio-economic condition, in its relations with the market, etc. That new knowledge, widely disseminated, without major scale obstacles and without legal restrictions on reproduction (there were no charges for royalties, breeder's rights or anything similar), helped to create social and productive inequalities. Those producers who already had a certain level of relationship with the market and a certain level of technological modernization made more and better use of the new standard. Those who had already innovated before innovated more.

You can then think the following. The dissemination of a new technology or new knowledge, without any assessment of its impacts and without ownership control (only with the motivation – well intentioned – of making it public), can (note that I said can, I didn't say must ) favor those who, at the start, are already better positioned. Along these lines, the results of public research, disseminated without criteria, can favor the strongest and exclude the weakest.

In economic literature, the theme appears, above all, through the definition of criteria that identify (and separate) public goods and private goods. In fact, there is numerous production on the subject and even today the possibility of separating, ex-ante, a public good from a private good is admitted. In short, non-appropriability and non-rivalry would identify a public good. In other words, if there are no mechanisms of private appropriability (difficult or impossible to appropriate the benefit generated) and if there is no rivalry in use (consumption by one does not exclude the possibility of consumption by others), the condition would be characterized of public good. Scientific knowledge would be, from this perspective, a typical public good.

With such identification it would be possible to define what should be done by public research (or even justify its existence). This view assumes that the public-private separation is a good guide for public policies to guarantee the greatest social benefit from investment (in this case, investment in research and S&T). The general idea is: public research is responsible for producing public goods and private research is responsible for producing private goods. If this once made practical sense, it definitely doesn't today. Thinking that scientific knowledge is always a public good is a mistake that can have disastrous consequences from a social and economic point of view. In the world we live in, whether we like it or not, scientific (and even more technological) knowledge, of any nature, is always very welcome and has economically measurable value and appropriability.

There is a logical separation, a very clear divide between public research organizations and the market. No one doubts that they are very different worlds, with different social functions. And it is precisely because they have different roles within the same society that one cannot ignore how the other works. The knowledge produced by one will be used by the other, in one way or another.

The fact that new knowledge has been produced with public resources does not mean that it should be made widely available. Public teaching and research organizations must evaluate the consequences of disseminating knowledge generated in their laboratories. In this sense, knowing and knowing how to use property rights is nothing more than an obligation of these institutions. It is an important step to effectively make public what was financed with public resources.

An interesting example is what Embrapa has been doing with the cultivars it develops. Combining its high competence in research with a unique ability to manage intellectual property instruments (read, the Cultivar Protection Law), the Company helped to restructure part of the national seed market, inducing the formation of more than a dozen foundations deprived of seed producers qualified to commercialize their varieties. These are organizations of small and medium-sized seed producers who would otherwise be excluded from the market, especially as a result of the advance of multinational companies in the 1990s.

Embrapa was only able to do this because it has strong competence in research, is linked to production and knew how to incorporate knowledge and skills to regulate forms of appropriation of the knowledge it generates. If it simply abdicated property rights and made its varieties available without knowing the behavior and organization of the seed market, it would be contributing to further concentrating and denationalizing the Brazilian seed market.

The point here is not to defend that there are property rights over knowledge for ideological or pecuniary reasons. That is another subject, for another debate. The point is not to have the luxury of, for the same reasons, not knowing the consequences of the institutional framework of intellectual property (in law and in fact) on the production and dissemination of knowledge.

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