For centuries technology transfer has been stolen and shared.

When Is Technology Transfer Okay?

by Elaine Schwartz    •    Jun 10, 2014    •    1014 Views

During the 18th century, Sweden gave cash to its “spies” in England so they could buy copper and iron production secrets. Meanwhile, England issued a patent to a chemist who just returned from Russia with a new brewing method. Moving in the other direction, Samuel Slater took from England the technology that let him establish the first US water-powered textile mill.

Where we are going with this? For centuries, nations have stolen intellectual property from afar. Feeling there was no need to distinguish between introducers and inventors, they patented the product or process and called it their own. Afterwards though, they sought to prevent other countries from doing precisely what they did.

In a 21st century version of intellectual property theft, on May 1st, the US accused Chinese military computer hackers of stealing trade secrets from our solar power, steel and nuclear plants. Broadening the topic to cybercrime, a June 2014 Intel Security report concludes that the US, Germany and China are among the largest losers.

Also though (and predictably), the US, Germany and China are increasingly facilitating global technology transfer:

Technology transfer among nations

From: McKinsey&Company “Global Flows in a Digital Age”

Below, we can get an idea of the content of the knowledge flows that move among nations.

The tension between sharing and prohibiting technology transfer.

From: McKinsey & Company “Global Flows in a Digital Age.” R&D Intensive Goods include industries like pharmaceuticals that require ideas, skilled labor and high tech.


Our bottom line? There is always a tension between protecting and disseminating new ideas. Knowledge transfers can provide a platform from which new ideas are generated and a springboard for economic growth. On the other hand, through patent and copyright protection, innovators can receive the rewards that spur further invention.

In a comment, please let us know how much you would encourage or prohibit global technology transfer.

Sources and more...H/T to James Surowiecki for his New Yorker column that alerted me to past and present technology issues, to this Doron Ben-Atar book that was my history source, and to the indictment of Chinese officials. For much more detail on global knowledge transfer, I recommend the McKinsey report and then for the theft side (which McKinsey does not touch), here is the Intel Security study.        

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