One of the important things you need to think about is whether you can safeguard the ‘intellectual property’ (IP) of your business idea. There are a number of ways you can do this: patents, trademarks, copyrights, industrial design rights and, in some countries, trade secrets. The justification of these rights is that they encourage the creation of IP and pay for associated research and development. It is claimed that there are substantial benefits in terms of economic growth for countries that encourage IP protection, whether or not it is a form of monopoly. A report by Shapiro and Pham (2007) observes that, while economists trace 30 to 40% of all US gains in productivity and growth over the course of the 20th century to economic innovation in its various forms, today, some two-thirds of the value of America’s large businesses can be traced to the intangible assets that embody ideas, especially the IP of patents and trademarks. They claim that ‘IP-intensive industries produce 72% more value added per employee than non-IP-intensive industries and create jobs at a rate 140% higher than non-IP intensive industries, excluding computers/electronics’. The authors go on to say that ‘promoting and protecting new IP should be a high priority for US policymakers’.
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