October 31, 2023

As part of its efforts to protect intellectual property rights, the Singapore Parliament passed the Patents Act on 31 October, 1994. Given the difficulties for private parties to derive commercial benefits from investment in basic scientific research, besides legal protection, public funding is also necessary to sustain basic research. A natural question then is, to what extent should the benefits of basic scientific research be spread and used for the sole benefit of the funding nation, i.e., ‘localizing’ the research findings.

The traditional explanation for the phenomenon of localizing research findings is that using the new discoveries also requires complementary knowledge and know-how that is not part of the knowledge presented and published in the form of basic research. Such tacit knowledge limits who can exploit the basic research findings. In ‘Tacit knowledge, localization push, and diffusion of science: Evidence from Singapore’ (Science and Public Policy, 2021), Associate Professor Albert Hu (NUS Economics) and Mr Vu Thinh Ly (Gojek) propose the alternative hypothesis that localization of knowledge is the result of policies by the local government that fund basic research.

Data used in the research came from records of citations of papers authored by Singaporeans. Specifically, the authors found that only 10% of the papers were cited more than five times, with less than half a percent of them cited more than fifty times.  Non-corporate patent applicants, which were mostly public institutions, contributed 75% of Singapore patents, and they drove most of Singapore’s commercialisation of basic research. Conversely, the corporate sector made use of foreign basic research patents much more often. The authors argue that local basic research is heavily localised, in the sense that papers authored by Singaporeans are disproportionately cited by Singapore patents and are predominantly accounted for by public institutions. Thus, localization in Singapore is significantly driven by public sector efforts.

In addition, the authors examined whether localization driven by public policies is efficient. They point out that localization necessitated by tacit knowledge makes the resulting exploitation of knowledge more productive than that undertaken by a distant party without such tacit knowledge. In contrast, government-driven localization may occur even when the tacit component of knowledge is absent, leading to no productivity advantage of localization. The latter seems to be the case for Singapore. The authors found that Singapore papers citing patents received fewer citations than their foreign counterparts. This suggests that for the purpose of promoting Singapore’s basic research, localization may be less effective than distant diffusion of research findings made overseas.

However, the authors also acknowledged that Singapore patents are more likely to be registered in major jurisdictions (the US, the EU, and Japan) than foreign patents. But they postulated that this could be because Singapore’s public institutions making the foreign registrations are less cost-weary and value multi-jurisdiction patents more.

Read the article here: https://academic.oup.com/spp/article/48/1/16/5989818