generated by the NIEs, Taiwan (China) and Korea in particular, which by 2004 had become the 4<sup>th</sup> and 5<sup>th</sup> biggest recipients of USPTO patents in the world, after the US, Japan and Germany.

**Table 6.  USPTO Patents Granted ***

||Number o<br>|f Patents<br>|Patents<br>|per 10000<br>|0 People<br>|
|---|---|---|---|---|---|
||1990-04|2000-04|1990-04|2000-04|% Change|
|East Asia (9)|2239|12108|0.14|0.72|17.6|
|NIEs|2159|11601|2.93|14.74|17.5|
|Hong Kong|184|616|3.15|9.32|11.4|
|Korea|633|4009|1.44|8.67|19.7|
|Singapore|36|382|1.09|9.87|24.6|
|Taiwan, China|1307|6593|6.30|30.17|17.0|
|S.E. Asia|31|140|0.01|0.04|15.3|
|Indonesia|6|15|0.00|0.01|8.8|
|Malaysia|13|64|0.07|0.28|15.3|
|Philippines|6|18|0.01|0.02|10.4|
|Thailand|6|43|0.01|0.07|20.9|
|China|48|368|0.00|0.03|22.9|
|World|107361|182523|1.98|2.95|4.1|
|Developed (21)|104170|168017|12.88|19.58|4.3|
|Japan|22647|35687|18.23|28.54|4.6|
|USA|59024|97104|23.00|33.56|3.9|
|Developing||||||
|Latin Amer. (11)|173|368|0.04|0.08|6.3|
|Emerg.Europe (9)|205|348|0.07|0.12|5.6|
|Source: US Patent a|nd Tradem|ark Office.|* Annual|averages.||

As with R&D, there is also a wide variation in patenting across East Asia. Taiwan (China) now generates some 30 patents per 100,000 people, about as many as Japan and the United States, the best performers among the developed economies. Korea, Hong Kong and Singapore generate around 8-10 patents per capita per year, similar to the performance of the developed OECD countries in the mid 1980s, although only about half the average OECD level today. Further down the scale, Malaysia generates 0.2-0.3 patents per capita, similar to Korea in the mid 1980s. Finally, countries such as China, Indonesia, Philippines and Thailand bring up the rear with patents per capita in the 0.01-0.07 range, although patenting in China is rising very rapidly from a low base.<sup>27</sup> Exhibits 9 and 10 show a scatter diagram of patents per capita versus per capita income (in PPP terms), using panel data for 1977-2004. (The sample is shown in two exhibits, to permit display of greater detail at different scales). As with R&D intensity, patents per capita tend to rise much more than proportionately to per capita income – 7-8 times more in this case. Thus patents per capita in Singapore are 30 times those in Malaysia, even though Singapore’s per capita income (in PPP terms) is only about 3 times higher than Malaysia’s. The exhibits pick out the trajectories of patents and income for individual countries over time. Exhibit 3 shows that 27 Hu and Jefferson (2005) suggest several reasons for the acceleration in Chinese patenting: (i) the acceleration in China’s R&D spending noted above; (ii) strengthening of China’s Patent Law in 1992 and 2000; (iii) the vast influx of foreign direct investment to China, which has greatly increased the market value of intellectual property for both foreign and domestic firms; (iv) the rapid relative growth of ‘complex industries’ like electronics and machinery, which involve many separately patentable sub-products and processes; (v) the acceleration of enterprise reform after the mid 1990s, which has greatly strengthened private property rights vis-à-vis state owned enterprises.

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