Innovation in Times of Conflict

Despite an unprecedented level of global economic integration, which has also led to a record volume of intellectual property flowing across borders, the world finds itself amid serious global conflicts once again. With an increasing emphasis on national security, states are adopting interventionist approaches to achieve non-economic objectives such as maintaining technological superiority. The growing tendency to intervene in the diffusion of technology for security reasons poses challenges to innovation. The article discusses various instruments states use to intervene in innovation processes, including investment control, patent secrecy orders, and export controls. Such strategic behaviour by a state, however justified it may appear to be, is alien to the market-based innovation system. The relationship is further complicated by the unique security needs of each state, the immense complexity of the innovation ecosystem, and the information asymmetry between the market participants and the state. The article provides policy suggestions to help mitigate the issue, such as promoting cooperation and transparency, and enhancing judicial effectiveness. „Es ist der Handelsgeist, der mit dem Kriege nicht zusammen bestehen kann.“ (“It is the spirit of commerce that cannot coexist with war.”)