Chapter 1: IP – a platform for productivity and growth

Australian firms are facing heightened geopolitical risk, rapid technological change, and globally reconfiguring supply chains. In such contexts, intellectual property (IP) serves not only as a mechanism for protecting inventions and brands, but as part of the economic toolkit that supports productivity, competition and business resilience. This chapter presents new research by IP Australia and its research partners, showing how firms use IP to manage risk, support growth, and compete in an increasingly uncertain and interconnected global economy.

Two themes are explored.

First, this chapter shows how patents and trade marks are associated with performance at critical points in a firm’s life. It presents new evidence for what happens inside Australian firms when they register their first IP rights, finding persistent effects on productivity and sales.

Second, this chapter highlights how a well-calibrated IP system and international cooperation can shape technological progress across borders – with particular relevance for middle-power economies such as Australia.

At a glance

• The first time a firm engages with IP marks a pivotal point in its growth. A firm’s first patent or trade mark grant coincides with sustained increases in income and productivity, usually as the firm shifts from experimentation to market activity.
• Patents and trade marks support different dimensions of a firm’s performance. Patents are associated with improvements in technological capability and production efficiency, while trade marks are linked to revenue expansion and labour productivity gains as firms build market presence and scale.
• The impacts of engaging with IP are persistent and strongest in IP-intensive sectors. The performance effects associated with first IP engagement endure over time. They are most pronounced in industries where innovation, branding and differentiation are central to competition.
• Patent policy shapes technological competition beyond national borders. A well-calibrated and internationally-aligned IP system influences innovation by firms in Australia and in global markets.

PerkyPod: Positioned to manage risk and grow strategically

Australian innovator Louise Burr understands the potential risks to her business. When starting her plant pot business, PerkyPod, Louise was intentional about 2 things. First, she was determined to produce her self-draining pots in Australia. Second, she made sure to secure IP rights to protect the unique design. Louise explains how this strategy has positioned PerkyPod well for future partnerships and investment.