International Business Chapter 10 1 Knowledge Becoming Less Dispersed And Easier For Countries Control There General Consensus

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CHAPTER 10

THE INTERNATIONAL KNOWLEDGE STRUCTURE: CONTROLLING FLOWS OF

INFORMATION AND TECHNOLOGY

Overview

Wealth and power often flow from access to and control over knowledge and technology. In this

chapter we examine ways in which knowledge and technology are created, diffused, and governed.

After defining the knowledge structure and identifying the main actors in it, we look at the

political economy of information. The key point is that governments and private businesses are

We then examine how developed countries try to foster innovation through a variety of policies

affecting technology, research, and skilled workers. We analyze comparative trends in state-funded

R&D and the drawbacks of relying on the private sector to spearhead national innovation efforts.

We also explain mechanisms by which the United States seeks to prevent foreign state and foreign

(copyrights, patents, trademarks, and geographic indications). We think the IPE literature has

historically neglected IPRs, and we hope that instructors will find IPRs worthy of serious

coverage. We present six different theoretical perspectives on intellectual property—those of

Key Terms

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intellectual property rights (IPRs)

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information sovereignty

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data localization

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Internet of Things (IoT)

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research and development (R&D)

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global value chains

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economic citizenship

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Trade-Related Aspects of Intellectual Property Rights (TRIPS)

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Patents

Teaching Tips

• While both parts of the chapter are important, individual instructors should feel free to

emphasize either the policies to promote information control, knowledge acquisition,

• Students will benefit from gaining a clear understanding of the differences between

different kinds of intellectual property. Moreover, class discussion is enhanced by debating

the relative merits of strong versus weak protection of IPRs. Point out that IPRs are not just

• Students may be unaware of the many ways in which states try to foster innovation and

knowledge-based industries through direct funding, IPRs, export controls, and immigration

and education policies. You might want to debate in class what students think is the

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creativity.

• A fun way to generate discussion about trademarks is to have your class watch the 2010

Oscar-winning animated film Logorama, in which police chase a criminal through a city

• Have students read some State Department cables released by Wikileaks and report on

what they contain.

1. According to Balaam and Dillman, what four major trends in the international knowledge

structure have become apparent over the last few decades? Comment on their potentially

unsettling or liberating effects.

2. Describe some ways that governments try to foster innovation in society.

3. What are some of the likely reasons why the United States opposes the norm of

information sovereignty and policies requiring data localization?

7. What are Intellectual Property Rights (IPRs) and why are they important in today’s global

markets? Briefly compare and contrast the mercantilist, liberal, and structuralist views on

IPRs.

8. Trade-Related Aspects of Intellectual Property Rights (TRIPS) is a controversial

agreement. Why?

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Sample Multiple-Choice Questions

1) Which of the following do Balaam and Dillman posit is an important trend in the

knowledge structure over the last twenty years?

a) Human capital and technology are becoming less important than control of land and

2) Which person is the leading force behind Wikileaks?

a) Chelsea Manning

3) Which statement is inaccurate?

d) The United States has a surplus in trade of digital and digitally-enabled services.

4) Which of the following scholars argues that the state should have a large role in funding

national R&D and fostering innovation?

5) Which of the following is not a government innovation policy in developed countries?

a) controls on technology exports

6) Which of the following statement is correct?

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a) The United States spends more money on R&D each year than any other OECD

7) Financialization is closely associated with each of the following except

a) shareholder value theory.

8) The United States seeks to prevent foreign countries from accessing U.S. advanced

technology by

9) Which of the following policies would an IPE scholar probably not consider to be

mercantilist?

a) deemed export controls

10) IPRs are an important issue for developing countries because

11) The act of a state allowing a domestic private company or government body to produce

and sell a good under patent without the consent of the patent holder is called

a) parallel importing.

12) Which of the following statements would an economic liberal probably agree with?

a) Technological laggards need to fight for more “policy space” in IPRs.

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13) What is the triple helix?

a) a regime to strengthen patents, copyrights, and trademarks

14) Which of the following is an example of efforts by developing countries to advance their

interests in the face of strong IPRs?

a) turning a blind eye to counterfeiting of foreign goods

15) Which of the following is probably the least controversial intellectual property issue?

a) TRIPS

16) Which statement about copyrights is correct?

a) The TRIPS agreement stipulates a minimum time period for which member states must

17) Which statement reflects the position of a “balancer” on IPRs?