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Development in the BRICS

The Geography of Innovation is Changing

May 10, 2013 | by ANA GARCIA & LUIS FERNANDES

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Patent registration, scientific citations and R&D policies: How the emerging powers Brazil, Russia, India, China and South Africa demonstrate the path of uneven development.

Economic growth accompanied by R&D and innovation are significant factors for many countries to sustain long-term social-economic development. A combination of those elements has created, among other important factors, changes in economic global governance with the rise of new emerging powers. But how close are these emerging powers, the so-called BRICS (Brazil, Russia, India, China and South Africa) to achieving gains in innovation?

These countries’ economic growth is significant. In 1980, the BRICS (including the former Soviet Union) made up 21 per cent of global GDP/Purchasing Power Parity, as opposed to the United States’ 21 per cent, Western Europe’s 24 per cent, Japan’s 8 per cent, and the rest of the world’s 26 per cent.

In 2008, the BRICS’ (now including just Russia) share of global GDP/PPP rose to 29.5 per cent of global GDP, compared to the United States’ 18.5 per cent, Western Europe’s 17 per cent, Japan’s 5.5 per cent and 29.5 per cent from the rest of the world.

The diffusion of economic activities from core to peripheral countries is part of the dynamic of uneven development. The concentration of capital, industry and economic activities in the core tends to be diffused toward the periphery in the global economy, shifting the dynamic poles in the global system.

In this process of diffusion some countries initiate their industrialization using more current efficient techniques, as well as lessons already learned by core countries. The evolution of the BRICS demonstrates this process of uneven development, since they could absorb the diffusion of industrial and technological activities with differentiated political and economic capacities.

The BRICS’s Growth in Scientific Production is Slower Than Their Economic Growth

In the information age, innovation gains strategic importance to leverage economies. The science and technology (S&T) and R&D fields are today one of the main factors in this uneven development among countries, as issues of technology and knowledge diffusion are subject of increasing and varied struggle in the international system.

A classical indicator for development in scientific knowledge is the rate of publications in international indexed scientific journals. This measure shows that the growth in participation of the BRICS is slower than their economic growth.

In 1996, the BRICS accounted for 9.1 per cent of scientific literature (compared to the United States’ 32.2 per cent, Western Europe’s 33.3 per cent, Japan’s 8.3 per cent and the rest of the world’s 17.1 per cent). In 2010, the BRICS increased their share to 21 per cent (compared to the United States’ 22.6 per cent, Western Europe’s 27.4 per cent, Japan’s 5.1 per cent and the rest of the world’s 23.1 per cent).

These measures indicate that, despite the growth in scientific research (largely driven by Chinese scientific accomplishments) Western Europe and the United States still occupy the top positions in publications in international indexed scientific journals.

National Patent Registration in the BRICS Has Tripled in the Past Decade

Data from registries of patents and industrial innovation demonstrates a similar trend. Patent registry, in practice, awards importance and more comprehensive protection especially at the United States Patent Office (USPTO). Here, innovations from the BRICS accounted for only 0.3 per cent of patents registered in 2000. By 2009, while participation from the BRICS is still meager, patents registered from these nations at the USPTO had grown to 2 per cent.

Since patent registry at the USPTO is a costly and difficult process for businesses and institutions outside of the United States, intellectual property rights (and, therefore, control over new technologies and products in the global market) remain concentrated in today’s developed countries.

Now, the registry of patents in national offices shows in international comparison other numbers. According to statistics presented by the World Intellectual Property Organization (WIPO), the global share of patents registered in the national patent offices of the BRICS countries tripled, from 5 per cent of global registries in 2000 to 15 per cent in 2009.

China accounts for much of this growth and this jump in patent registry during the 2000’s reflects China’s emphasis on innovation. The BRICS study of the Bertelsmann Foundation's Sustainable Governance Indicators also shows that Chinese research and innovation policy largely supports innovations.

According to WIPO’s World Intellectual Property Report 2011, the geography of innovation is changing. Even though rich countries still dominate expenditures on R&D (making up 70 per cent of total global investment), middle-income countries increased their share of global R&D investment by 13 percentage points between 1993 and 2009. China itself accounts for the lion’s share of this increase — accounting for over 10 of those percentage points. In 2009, this makes China the second largest investor in R&D.

China Incorporates Innovation as a Pillar of Economic Growth

These whole set of data show “three paces” of uneven development. In reference to the economic dynamism and the shift of industrial activities and investments toward the BRICS, changes have taken place in an accelerated fashion, resulting in a rapid and significant increase in GDP/PPP in these countries.

The scientific production capacity of the BRICS, exemplified in the rate of participation in international indexed scientific publications, accompanies to some extent this growth, albeit at a slower pace. The patent registries, as an indicator of innovation, show that the inequality between the BRICS and the traditional powers is still accentuated, and does not accompany economic growth. Apparently, however, China incorporates innovation as a pillar of its economic growth, as evidenced by the increase in patent registrations, which may soon rival the level of core countries.

We look, therefore, to the need for the BRICS to incorporate research, development and innovation into their economic growth, if they want to achieve social-economic development in the long term, and change their power position in the world order.

Ana Garcia is a researcher at the BRICS Policy Center in Rio de Janeiro.

Luis Fernandes is Professor of International Political Economy at the Pontifical Catholic University of Rio de Janeiro and current Executive Secretary of the Brazilian Ministry of Sports.

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