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Taylor Wessing Global Intellectual Property Index 2009

Jurisdiction Analysis

In order to examine how stable the rankings might be in the future, the overall GIPI 2 rating has been contrasted with a jurisdiction’s sensitivity (measured by the sensitivity to changes in the instrumental factors). Each of the instrumental factors was examined to see how it changed jurisdiction rankings. The variance of the scores is termed ‘sensitivity’. If a jurisdiction’s ranking changed markedly over the 16 sub-indices, it might be anticipated that it had a lot of potential to improve, or decline. If a jurisdiction’s ranking remained fairly stable over the sub-indices, its rating is more likely to remain fairly stable in the future:

Chart 2 – Sensitivity to Instrumental Factors

 

Sensitivity to Instrumental Factors

 

This categorisation identifies different types of jurisdiction:

Leaders & Evolving jurisdictions

The tier 1 jurisdictions are mainly in the Leaders sector whilst tier 2 jurisdictions are close to the border between the Leaders and Evolving sectors. The tier 3 jurisdictions are in the Evolving sector but have higher sensitivity to the instrumental factors. This indicates that they may be volatile in their future ratings.

Volatile and Minor jurisdictions

The BRIC jurisdictions are in the Minor sector except Russia which is in the Volatile sector with the tier 4 jurisdictions. Brazil, India and China have relatively low sensitivity to changes in the instrumental factors and seem unlikely to radically change their ratings soon.

Another measure of how volatile a jurisdiction's ranking might be is the ‘spread’ or variance of the individual assessments given to each jurisdiction (i.e. some respondents assessed them highly and other respondents assessed them poorly). The sensitivity described above and the variance of assessments are plotted together below:

Chart 3 – Sensitivity to Instrumental Factors v Variance of Assessments

 

Sensitivity to Instrumental Factors v Variance of Assessments

 

There are three ‘bands’ of jurisdictions:

The ‘Unpredictable’ jurisdictions in the top right of the chart have a high sensitivity and a high variance of assessments. These jurisdictions (the tier 5 jurisdictions and surprisingly Canada from tier 2) have the highest potential volatility in GIPI ratings.

The ‘Stable’ jurisdictions in the bottom left of the chart (including most of the tier 1 jurisdictions) have a low sensitivity and a lower variance of assessments. These jurisdictions are likely to exhibit the lowest volatility in future GIPI ratings.

‘Dynamic’ jurisdictions in the centre have the potential to move in either direction.

It is interesting to compare the jurisdictions categorised as unpredictable in GIPI 1 with those categorised as stable. The average movement of the unpredictable jurisdictions is over 22 points whilst the average movement of the stable jurisdictions is under 11 points. We will watch the progress of the unpredictable jurisdictions with interest.

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