Professor Michael P. Ryan, Ph.D.
Capabilities, Intellectual Property
Institutions, and Development
Country Capabilities
“Driving explanation for sustained absolute country
advantages is to be found in the persisting variation
of organizational and institutional capabilities across
time.” (Kogut, 1991:33-34)
Capabilities are dynamic=
“the capacity to renew competences”
(Teece, Pisano, and Shuen, 1997:515)
How Do Firms Compete/Innovate?
Create and Integrate Knowledge
(Kogut and Zander, 1992; Grant, 1996)
How do Entrepreneurs Innovate?
Prior Knowledge-Based Creation
(Shane, 2000)
Tangible and Intangible Resources
Wernerfelt, Strategic Management Journal (1984)
Grant, California Management Review (1991)
Resource=any strength or weakness of firm; tangible and
intangible assets tied semi-permanently to the firm (Wernerfelt)
Major categories of resources (Grant, 119):
 Financial
 Physical
 Human
 Technological
 Reputation
 Organizational
Colombian Coffee Growers Federation
Intangible Asset
Juan Valdez Brand Strategy 1960
Trademark Law and
Marketing Scholarship
•Source Identity
(Brown, 1948; Lemley, 1999; Litman,
•Commercial Meaning
(Schecter, 1927; Landes & Posner, 1987;
Beebe, 2003-2004, 2005)
Colombian Coffee Growers Federation
• International Marketing Offices
Amsterdam, New York, Tokyo, and Beijing
• 1,500 trained agronomists
• 10-point quality management grading system
• 15 provinces; 35 cooperative; 25 inspection centers;
516 purchase centers
Colombian Coffee Growers Federation
Colombian Coffee Growers Federation founded in 1927
328,000 growers federation ID card (500,000+growers)
4,368 growers elected to committees
364 municipality committees
15 regional committees
National Coffee Congress
National Coffee Board
2,500 employees – 5-point HRM evaluation criteria
National Coffee Fund US$1.5 billion to growers early 1990s
CSR – 180 clinics; 200 health centers; 681,000 vaccinations; 6,000
schools; 5,000 teacher housing facilities; 10,000 miles of roads;
3,000 bridges
Colombian Coffee Growers Federation
DYNAMIC Capabilities
• Chinese Market Opportunity?
• Juan Valdez Cafes?
• Freeze-Dried Coffee?
Common Pool Resources
for Development
Forestry, Biodiversity, Agriculture
Where does breakthrough
technology innovation occur?
“Invention is the first occurrence of an idea for
a new product or process, while innovation is
the first attempt to carry it into practice.”
(Fagerberg, 2005:4)
What characteristics of capabilities and
institutions explain why breakthrough
technology innovation takes place in one
country but not in another?
Comparative Study of Breakthrough Bio-Medical
Technology Innovation in Brazil and India
Breakthrough Bio-Medical Technology Innovation
(Wholly-New Product or Chemical Entity)
Sao Paulo: Institute Butantan, University of Sao Paulo,
Delhi and Bangalore: All India Institute of Medical Sciences, Department of Biotech ,
National Institute Immunology, National Institute of Translational Science,
National Research Development Corporation, IISc—Bangalore,
IIT-Delhi, University of Delhi,
Biomed Tech Innovations in Sao Paulo
• Ache Laboratories Farmaceuticos
• Institute Butantan Center for Applied Toxinology/COINFAR
• Pele Nova Biotecnologia
• Genoa Biotecnologia
• Recepta Biopharma
Biomed Tech Innovations
in New Delhi and Bangalore
• Lifecare Innovations
• Premas Biotech
• bigtec Labs
Breakthrough Biomed Technology
Capabilities and Institutions
in Brazil and India
• Brazil = FINEP & FAPESP (NSF-like) + university and
public research institutes, including technology
incubators + active patent office + global networks
• India = new Biotechnology Industry Research
Assistance Council (Dept of Biotech/Ministry of S&T
plus stakeholders) + new university and public
research institute cluster parks + global networks
Study of Breakthrough Green Tech Innovation
in China
Beijing and Shanghai
Chinese Academy of Sciences, Fudan University, Institute for Environment &
Development, Peking University, Tsinghua University
Beijing and Shanghai Breakthrough
Green Tech Innovator-Entrepreneurs
• Beijing GW Process Technology Company
(Professor Li and Dr. Li)
• Tsinghua Solar Systems
(Professor Yin Zhiqiang)
• Shanghai Garbage Recycle Company (pseudonym)
• Pearl Hydrogen Technology Company
(Brian Tian)
Breakthrough Green Tech Innovation
Capabilities and Institutions in China
Entrepreneurial public research institutes &
universities + technology parks + senior
government advocacy + active patent office +
global networks + emerging angel/venture
capital investment (?)
How Do Entrepreneurial Universities Emerge?
Public Good of Basic Science
(Nelson, 1959)
Entrepreneurial University and
Public Research Institute
(Etzkowitz, 1998)
How Do Technology Networks Emerge?
Network Governance Facilitates
Diverse Knowledge Integration
(Powell, 1990)
Public-Private Bio-Medical Technology Networks
Integrate Science and Commercial Knowledge
(Powell, Doput, and Smith-Doerr, 1996)
Do Patents Encourage R&D?
Do Patents Encourage
Technology Markets?
Patents Solve Technology Appropriability Problem
(North, 1981; Teece, 1987; Dam, 1994)
Patents Facilitate Technology Markets
(Arora, 1995)
How Do Risk Capital Markets Emerge?
•Entrepreneurial Public Research Institutes and
Universities (Incubators)
•Public S&T Funding Agencies
•Angel and Venture Capital Investors
Michael P. Ryan
“Patent Incentives, Technology Markets,
And Public-Private Bio-Medical
Innovation Networks in Brazil”
World Development 38(2010)1082-1093
Professor Michael P. Ryan, Ph.D.

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