The Office of the Chief Scientist
Benchmarking Australian Science, Technology, Engineering and Mathematics report [
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Science, technology, engineering and mathematics, referred
to as STEM, are central to our future because of their role
in securing Australia’s competitiveness in a rapidly changing
world. The Prime Minister, the Hon. Tony Abbott MP,
acknowledged this on 11 June 2014, when he said, ‘… science
is at the heart of a country’s competitiveness, and it is important
that we do not neglect science as we look at the general educational
and training schemes’.
In view of the central importance of STEM, we need
to know how we perform. We need to get ‘a fix’ on our
performance—not an easy one, against ‘the world’, but
a more challenging one, against nations that, like us, are
essentially free-market economies with serious science
engagement. We often depict Australia as ‘punching above
its weight’ in research performance, with about 3 per cent
of research outputs from 0.3 per cent of the world’s
population. But approximately 90 per cent of all STEM
research publications are attributed to roughly 15 per cent
of countries and 90 per cent of citations are attributed to
approximately 13 per cent of countries. Where we stand
relative to ‘the world’ is of marginal value only, serving
mainly to direct our attention from where it should be,
which is on how to improve.
STEM is a global enterprise. As nations with which we
collaborate and compare ourselves take planned, often
urgent, action to improve their STEM base, we must be alert
to the changes and decide what we ourselves want to do.
In order to make wise choices, however, we need to know
the baseline from which we start and have a view about
where we want to be within a reasonable time.
This report provides insights into where we are and will
help us decide what we should do. As an analysis mostly at
a high level—signposts in kilometres not metres, let alone
centimetres—it is intended to highlight performance and
trends that might warrant further investigation, prompt
questions for government and contribute to discussion on
the future shape and scale of Australian STEM.
Chapter 4 of the report
examines the number of Patent Cooperation
Treaty patent applications and triadic patent families filed
by Australian inventors compared with inventors from
other countries.
It states -
4.1 MAIN FINDINGS
- The number of Patent Cooperation Treaty applications
and triadic patent families filed by an Australian inventor
has fallen steadily in recent years. PCT applications have
fallen by 22 per cent from their peak in 2005; triadic
applications have fallen by 45 per cent from their peak
in 2000.
- The number of PCT applications and triadic patents has
increased for all the comparator countries other than the
United Kingdom.
- The number of Australian PCT applications with a
foreign co-inventor increased between 2002 and 2011.
Despite this, the proportion of Australian PCT patents
filed with an international co-inventor in 2011 was lower
than that for most of the comparator countries, including
all the European countries.
4.2 BACKGROUND
Patent systems have an important role in stimulating
technological innovation by providing legal protection for
intellectual property and disseminating useful technical
information (Merrill et al. 2004). This facilitates technology
transfer and the commercialisation and diffusion of
knowledge. The patent system has clear economic objectives,
but it also leads to non-economic benefits by increasing
innovation and opening up access to new technologies
(Advisory Council on Intellectual Property 2011).
Patents can demonstrate a country’s capacity or willingness
to exploit knowledge and translate it into potential
economic benefits (European Commission 2012). They have
been used to track knowledge diffusion across countries,
regions, technologies and companies and to assess the
international reach of innovative activities (Dernis 2007).
Patent counts have been described as ‘measuring something
above and beyond R&D inputs, a creation of an underlying
knowledge stock’ (Hall et al. 1986).
4.3 TERMINOLOGY
Like many countries, Australia issues national patents
through a national patent office, thereby protecting
inventions developed within national boundaries.
Local patents represent only a small proportion of total
Australian patents, however: a better benchmark for
innovation with international ramifications is a comparison
of applications under the PCT and triadic patent families.
For the purposes of this report, the nationality of a patent is
considered to be the inventor’s country of residence.
4.3.1 The Patent Cooperation Treaty
Australian patents provide protection within Australia.
To obtain protection in other countries inventors can
either file separately in individual countries or file a single
international application under the Patent Cooperation
Treaty, which is administered by the World Intellectual
Property Organization. A patent registered under the PCT
is the closest thing to an international patent and protects
inventions in over 180 countries.
Both applicants and patent offices in PCT member
states benefit from the uniform formality requirements,
the international search and preliminary examination
reports, and the centralised international publication
provided by the PCT system (World Intellectual Property
Organization 2010).
4.3.2 Triadic patent families
Another measure of international innovation is the triadic
patent family—a set of patents protecting the same
invention and filed at the European Patent Office, the
Japanese Patent Office and the US Patent and Trademark
Office. It has been suggested that triadic patent families
provide an improved measure of innovative performance
and technological change at the international level (Dernis
2003). This is because triadic patent families cover a single
invention and the resultant indicators are less influenced by
individual patent offices’ rules and regulations and patenting
strategies (Dernis 2007).
4.4 DATA SOURCES
The OECD Patent Database, created by the Directorate
for Science, Technology and Industry, covers patents filed
under the PCT, and counts are based on data received from
the European Patent Office. Only the original application
is counted, thus avoiding double-counting of the same
invention. The EPO Database provides good coverage for
both OECD member and non-OECD member economies
from 1981. PCT applications are presented according to the
region of the inventor’s residence and the priority year.
The OECD Patent Database also covers triadic patent
families. Data on triadic patent families are mainly derived
from the EPO’s Worldwide Statistical Patent Database
(PATSTAT).
4.5 COUNTRIES ANALYSED
As in the previous chapter, two groups of benchmarking
nations were identified for analysis—countries at stages of
development similar to that of Australia and with similar
governance systems (the United States, Canada and
selected European nations), and selected countries in the
Asia–Pacific region.
This chapter compares Australia with the 11 European
comparator countries (Austria, Belgium, Denmark, Finland,
France, Germany, Ireland, Norway, Sweden, Switzerland
and the United Kingdom), North America (Canada and the
United States), and countries in our region (China, Japan,
New Zealand, South Korea and Singapore).
4.6 PATENT APPLICATIONS IN AUSTRALIA
AND ELSEWHERE
4.6.1 Australian patent applications, 1981 to 2011
In 2012, 26 358 ‘standard patents’ were filed in
Australia—10 per cent by Australian residents and
90 per cent by foreign applicants (IP Australia 2013).
PCT applications accounted for 72 per cent (19 107)
of the total. US residents filed the highest number of
Australian standard patents (11 376), followed by Japan
(1746) and Germany (1594).
The number of PCT patent applications by an Australian
inventor increased from 172 in 1981 to a peak of 2092 in
2005 (see Figure 4-1). The most rapid growth was between
1996 and 2005; this was followed by a 22 per cent decline
from 2005 to 2011.
Triadic patent families form a much smaller group
than PCT patents (see Figure 4-2). In 1985 there were
153 triadic patents with an Australian inventor, compared
with 357 PCT patents. By 2000 the number of triadic
patents had increased to 380 (a 148 per cent increase)
and PCT patents to 1755 (362 per cent). After 2000
triadic patent families began to decline (by 45 per cent
from 2000 to 2011), whereas PCT applications continued
to rise until 2005.
The decline in PCT applications after 2007 might in part
be a reaction to the global financial crisis. The Department
of Industry reported an 11.6 per cent decrease in Australian
standard patent applications (that is, applications filed in
Australia) from 2007 to 2009. It attributed this to economic
disruption caused by the GFC (DIISR 2012). By contrast,
the decline in triadic patents started in 2001, six years before
the GFC began.
4.6.2 Australia’s patent applications and those of
comparator countries, 2002 to 2011
With the exception of the United Kingdom and New
Zealand, the number of PCT applications filed by each of
the comparator countries increased between 2002 and 2011
(see Figure 4-3 and Table 4-1). Australian applications
declined by 7 per cent, compared with increases of between
10 and 50 per cent in many of the European comparator
countries. Australia’s rank within the comparator countries
decreased from ninth in 2002 to eleventh in 2011, with
Switzerland and China overtaking Australia.
The United States had the greatest number of PCT
applications in both 2002 and 2011. By 2011, however, the
gap between the United States and its nearest competitor,
Japan, had decreased. China’s PCT applications grew by
1194 per cent between 2002 and 2011, from 1316 to 17 027.
Of the Asia–Pacific countries analysed, PCT patent activity
in China was well behind that of Japan but ahead of Korea,
Australia, Singapore and New Zealand. Asian nations have
led the growth in patent applications, with China, Korea,
Japan and Singapore increasing the most.
The number of Australian triadic patent families declined
by 29 per cent between 2002 and 2011, from 294 to 209.
Among the 19 countries analysed in this chapter, Australia
had the fifth lowest number of triadic patent families in
2011 (see Figure 4-4).
4.6.3 PCT applications in Australia and comparator
countries after the global financial crisis
After the global financial crisis global PCT applications
fell by 4.5 per cent in 2009 (World Intellectual Property
Organization 2010), the first such decrease in three decades
(Mara 2010). In some ways the GFC rearranged the
international patent landscape, resulting in large decreases in
applications in many Western nations but growth in many
Asian countries. China, in particular, experienced a large
increase in PCT applications between 2008 and 2009, at
29.7 per cent (see Table 4-2).
The countries that experienced the greatest decrease in
PCT applications immediately following the GFC were
Ireland (–11 per cent), Denmark (–10 per cent), the United
Kingdom (–6 per cent), Sweden (–5 per cent) and the
United States (–4 per cent). Although Australia’s PCT
applications increased by 1 per cent between 2008 and 2009,
the number declined again in 2010 and 2011, continuing the
fall from the 2005 peak (see Figure 4-1).
The overall patenting trend for Australia before and after the
GFC was one of declining PCT and triadic patent activity.
This contrasts with most of the European countries analysed:
all but the United Kingdom achieved overall growth in PCT
patent applications from 2002 to 2011, despite a general
slowdown in the post-GFC years.
4.6.4 International collaboration in PCT patents,
2002 and 2011
Globalisation trends are reflected in the internationalisation
of R&D and innovative activities (Guellec & Potterie
2001). Cross-border co-invention represents international
collaboration in the inventive process (Dernis 2007).
In 2011 the share of Australian PCT patent applications
filed with a co-inventor located abroad was 17 per cent
(see Figure 4-5). Cross-border co-invention was lower
in Australia than in all the analysed European countries,
New Zealand (23 per cent), India (29 per cent), Canada
(31 per cent), Singapore (33 per cent) and Indonesia
(52 per cent). Australia’s cross-border co-invention did,
however, increase from 14 per cent in 2002 to 17 per cent
in 2011.
4.7 COLLABORATION BETWEEN BUSINESS
AND RESEARCH INSTITUTIONS ON
INNOVATION
Australia’s low patenting rates reflects the poor
collaboration between business and research in the public
sector (Figure 4-6). Australia has the lowest level of business
to research collaboration among the comparator countries.
In OECD analysis of innovation active businesses, out of
a total of 33 countries, Australia ranks 32nd on business
to research collaboration for small to medium enterprises
(SMEs), and 33rd for large firms (OECD 2011b).
Similar analysis by the ABS, for countries for which data
are available but including businesses with 0–9 employees,
improves our position to 15th for SMEs and 21st for large
firms. Only 13.7 per cent of our large firms collaborated
with research organisations: slightly above the level of
collaboration—9.6 per cent—by our SMEs (Department
of Industry 2013).
4.8 CONCLUDING REMARKS
Australian industry is dominated by small to medium
business enterprises rather than R&D-intensive
multinational enterprises. This industry structure probably
influences Australia’s patenting profile. Although business
funds large amounts of R&D (see Chapter 5), the
outcomes of this R&D have not resulted in large numbers
of patentable inventions. The low proportion of researchers
in businesses (compared with higher education—see
Chapter 8) and the low level of business to research
collaboration might further limit Australia’s capacity to
produce new intellectual property with commercial potential.
The majority of patents applied for at the Australian
Patent Office are from international patent holders:
Australia imports more patentable intellectual property
than it produces.
These findings complement those in Chapter 2.
Australia has a low to mid-range level of performance
in patenting compared with European comparator
countries and much lower than the larger economies of
the United States, Japan and China. Our performance
is poor—particularly when viewed against the dynamic
patent activity among Asian nations.
