Event Report  |  11/04/2016

4th Crowdinvesting Symposium „Financial Decision Making and the Internet

The fourth Crowdinvesting Symposium took place on 4 November 2016 at the Max Planck Institute for Innovation and Competition in Munich. The topic of this year’s event was “Financial Decision Making and the Internet”, and it brought together around 70 participants to discuss current research in the areas of FinTech, crowdfunding, crowdinvesting, crowdlending and social trading. In 16 papers and eight slam presentations, economics and law scholars presented the results of their research.

f.l.t.r.: Ethan Mollick (Wharton School, University of Pennsylvania), Florian Prucker (Scalable Capital), Andrea Rexer (Süddeutsche Zeitung, Leiterin Finanzressort), Daniel Halmer (raisin), Lars Hornuf (Universität Trier, Max-Planck-Institut für Innovation und Wettbewerb). Foto: Max Planck Institute for Innovation and Competition

This year’s keynote speaker, Prof. Ethan Mollick of the Wharton School of the University of Pennsylvania, presented his current research, pointing out that crowdfunding today, far from being a niche phenomenon, is as integral a part of start-up financing as venture capital or bank loans. Following the talk was a podium discussion with the keynote speaker and a panel made up of Daniel Halmer from the Berlin-based FinTech raisin, Lars Hornuf of the Universität Trier and the Max Planck Institute for Innovation and Competition, and Florian Prucker from the Munich-based FinTech Scalable Capital. Andrea Rexer, Head of the Financial Section of the Süddeutsche Zeitung, moderated the discussion on current developments in FinTech. One central insight from the discussion is that FinTechs have a positive attitude towards market regulation, particularly when it works to reduce legal insecurities. Another key issue concerned the role that humans and algorithms will play in the future in the various financial markets.


The Crowdinvesting Symposium is an annual event that was initiated in 2013 by Jun.-Prof. Lars Hornuf, University of Trier, and Prof. Lars Klöhn, Humboldt University Berlin. The symposium offers academics and practitioners a platform to exchange ideas about the latest developments in the field of crowdinvesting as well as for networking. Moreover, it is a forum meant to inform legislators on the European and national level on a scientific basis with regard to new legislative proposals or legal reform projects. This conference is part of the research project “Crowdinvesting in Germany, England and the USA: Regulatory Perspectives and Welfare Implications of a New Financing Scheme“, supported by the Deutsche Forschungsgemeinschaft (German Research Foundation).

Award  |  10/26/2016

Best Paper Awards - "Crowdfinancing" and "Inventor Mobility"

On October 6, 2016, Michael Moedl received the KSG Best Entrepreneurship Research Award 2016 for his paper "Is Wisdom of the Crowd a Positive Signal? Effects of Crowdfinancing on Subsequent Venture Capital Selection" during the 20th Annual Interdisciplinary Conference on Entrepreneurship, Innovation and SMEs (G-Forum) in Leipzig.

f.l.t.r.: Marleen Schreiber (Karl Schlecht Foundation), Prof. Dr. Joern Hendrich Block (Trier University and Committee of the FGF e.V.), Michael Moedl (Max Planck Institute for Innovation and Competition). Photo: Dominik Wolf

The prize, endowed with EUR 2,000, is awarded by the Karl Schlecht Foundation. The non-profit foundation aims at improving leadership in business, society and politics by humanistic values and encourages and supports impact oriented projects and institutions in the funding areas leadership, ethics, education, culture and technology.

 

The paper examines the impact and signaling effects of crowdfinancing on subsequent venture capital funding rounds. Drawing on a choice experimental research design the author finds causal evidence that crowdfunding – relative to other prefunding sources – is often a negative signal for professional venture investors, but that the “crowd” can nonetheless and under certain circumstances send positive signals increasing the likelihood of subsequent financing rounds.

 

As early as August, the team of authors consisting of Matthias Dorner, Dietmar Harhoff, Tina Hinz, Karin Hoisl and Stefan Bender was awarded the AoM TIM Best Paper Award for the paper “Social Ties and Quality Signals – Lessons from the Migration of East German Inventors” at the Academy of Management Meeting 2016 in Anaheim, California.

 

The paper dealt with the impact of social ties and publicly observable performance signals on the migration of knowledge workers. The fall of the Iron Curtain and German reunification were used as a natural experiment for the migration decision of East German inventors.

 

Results showed that regions with more pronounced social ties across the border prior to the fall of the Iron Curtain attracted more inventors as of 1990. Furthermore, mobility decisions made by inventors with visible performance signals were substantially less impacted by social ties than those of inventors who lacked these signals. The project was conducted with researchers from the Institute for Employment Research (IAB) in Nuremberg.

Award  |  09/29/2016

Annette Kur receives Pattishall Medal for Teaching Excellence 2016

Affiliated Research Fellow at the Munich-based Max Planck Institute for Innovation and Competition, Annette Kur, was awarded the “Pattishall Medal for Teaching Excellence 2016“ by the International Trademark Association (INTA).

In honor of Beverly W. Pattishall, this award recognizes teaching professionals in the business and legal fields for outstanding instruction in the trademark and trade identity field. Beverly W. Pattishall was a long-time partner in the firm of Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP. This award is presented every four years to a university or graduate school academic nominated by peers and students, and who best exemplifies the qualities of excellence and innovation in teaching subjects related to trademarks and trade identity.


Dr. Kur received an outstanding 18 nominations for this award. In one of the nominations, a former student described Dr. Kur as, “not only instrumental in triggering [her] interest in intellectual property law and its international context, she has also profoundly influenced [her] outlook on trademark and design law by favoring a critical approach, rooted in legal principles, and promoting awareness and consistency of the international context in an area as internationalized as trademark law.”


“It is evident in the numerous nominations that Dr. Kur embodies the qualities of a world-class teaching professional and Pattishall Medal Award recipient. Dr. Kur’s dedication and commitment to education is exemplary and our Association is pleased to have this opportunity to recognize her achievements in the classroom,” said 2016 INTA President Ronald van Tuijl. “We are honored to present Dr. Kur with this award.”


Dr. Kur will receive US $2,500 along with an invitation to attend INTA’s Leadership Meeting in Florida in November, where she will be formally presented with the award.


The International Trademark Association (INTA) is the global association of trademark owners and professionals dedicated to supporting trademarks and related intellectual property in order to protect consumers and to promote fair and effective commerce. Members include more than 6,700 trademark owners, professionals and academics from more than 190 countries, who benefit from the Association’s global trademark resources, policy development, education and training, and international network. Founded in 1878, INTA is headquartered in New York City, with offices in Brussels, Shanghai and Washington, D.C., and representatives in Geneva and Mumbai.

Event Report  |  07/21/2016

Celebrating the 50th Anniversary of the Max Planck Institute for Innovation and Competition

With a two-day event on 12 and 13 May 2016 in the impressive rooms of the Munich Residence the Max Planck Institute for Innovation and Competition celebrated its founding 50 years ago.

f.l.t.r.: Prof. Dietmar Harhoff, Ph.D., Prof. Peter Drahos, Ph.D., Cornelia Rudloff-Schäffer, Dr. Georg Schütte, Prof. Dr. Josef Drexl, Ilse Aigner, Prof. Dr. Reto M. Hilty, Prof. Dr. Martin Stratmann, Prof. Dr. Hans-W. Micklitz. Photo: Andreas Pollok

With welcoming speeches by guests from the political, economic and academic spheres, the official ceremony, which took place in the Imperial Hall, acknowledged the significance of the Institute and the topics of its research for wide areas of society. The academic symposium, held in the Max Joseph Hall, focused on the internal perspective, looking at past research contributions of the Institute and potential avenues for future research, and included contributions by alumni, academic guests and members of the Board of Advisors.


The Institute first took up its work on 1 March 1966 as the Max Planck Institute for Foreign and International Patent, Copyright and Competition Law under the direction of Eugen Ulmer. Since then it has carried out basic research on various aspects of intellectual property and competition law, advised decision-makers in politics and economics and provided guidance for legislative proposals. Following the addition of an economic sciences department in 2013, the central focus of the Institute’s research is now on the framework conditions for innovation and competition and how to shape the processes involved by legal and economic means.


In his welcoming speech, Prof. Dietmar Harhoff, Ph.D., Managing Director of the Max Planck Institute for Innovation and Competition, described the Institute’s four name changes in recent years as an expression of the “dynamic nature of its fields of research and the increasing interconnectedness” of the Institute. He cited among its current topics digitalization and connectedness. “Seen in this light, business models and data protection issues, but also the design of copyright and competition legislation, have a much stronger international dimension than ever before in the history of the Institute“, emphasized Harhoff. The scientific guidance of standardization measures is an important task. Not least through its “increased focus on the empirical analysis of the workings of legal norms and the activities of economic agents on markets”, the Institute has opened itself up to new research methods. Even with the Institute’s dynamic history, however, it has always had an “element of great reliability”, Harhoff stressed: “The Institute has succeeded time and again in finding excellent, talented employees in all areas”.


The President of the Max Planck Society, Prof. Dr. Martin Stratmann, praised the Institute “an excellent example of a successful founding and a constant process of adjustment to the scientific questions of the day”. The topics of innovation and competition are “today more important than ever”, Stratmann stated. “They dominate the headlines and are omnipresent in the innovation dialogue with the German Chancellor”, said the President. “And our MPI for Innovation and Competition is right at the heart of it, and with its legal-economic orientation it is best prepared to get at the very essence of innovation and competition as such – independently and from a scientific perspective”. The inclusion of the field of innovation economics in an Institute with an orientation toward intellectual property and competition law was a logical but in and of itself nevertheless a “very innovative step”, said Stratmann, citing the worldwide recognition of the Institute’s expertise: It was not without reason that Federal Minister of Justice Heiko Maas last year referred to the MPI as “the most important European think tank for intellectual property and copyright law”. As examples of the Institute’s activities Stratmann named the Conflict of Laws in Intellectual Property, or “CLIP”, Principles on issues of international procedural law and applicable law in the area of intellectual property, which were formulated under the direction of the MPI for Innovation and Competition and the MPI for Foreign and International Private Law, as well as the Institute’s consultation activity during the adoption of the Directive on Collective Rights Management and the subsequent German implementation in a new Act on Collecting Societies.


Just how studious the researchers at the Institute are, the Max Planck Society President was able to report at first hand: When he leaves his office in administrative headquarters at the end of the day, in the opposite wing of the glass science complex, he can always see researchers working in the Institute’s library, “some with law books, some without, from all parts of the world and always bent in intense concentration”. This, he confirmed, stands for many things that comprise the core ideals of the Max Planck Society: “Internationality, interdisciplinarity and up-and-coming scientists who are eager to work“. A Max Planck President, he concluded, could not have a more satisfactory end to his working day.


State Secretary Dr. Georg Schütte from the Federal Ministry for Education and Research likewise held the bundling of competences in economics and law within one Max Planck Institute to be “a good solution”. With its new orientation, the Institute plays “an outstanding role in the field of innovation research in Germany” today. The pervasiveness of digitalization in all areas of work and life means that immaterial goods are more and more becoming an integral part of new business models in our net-based economy. Because this trend will shape not only our way of working, but also our way of life in crucial ways, it also increasingly raises “ethical questions”, explained Schütte, listing the most urgent ones: “Who has the primary right to personal data, and especially the knowledge generated from these data: the provider of data, the collector of data, or the user of data? Who under the legal regime is originally vested with the right to dispose of non-personal and yet activity-based data, even if such data might again be transferred? And how can a common basic consensus be achieved in this area by international cooperation?” These questions cannot be answered without legal-ethical value judgments. “In your Institute we have an institution”, State Secretary Schütte declared, “that, both with its analysis concerning the protection of immaterial goods and with the corresponding topics in innovation and entrepreneurship, has filled in a crucial gap in German research”.


Bavarian Minister for the Economy Ilse Aigner congratulated the Max Planck Institute as an “internationally renowned think tank”. She described Bavaria’s strategy for dealing with the digital challenge through its economic and scientific policy, for instance by creating 20 new digital professorships or support for digital start-ups. Aigner defined her goal as putting Bavaria at the head of the digital economy in Germany. “Big data”, she said, is one major emerging topic in which the strictures of data protection and thus of the law will undeniably have to be observed. “You won’t run out of topics for your work anytime soon”, the politician predicted.


Speaking for the Academic Advisory Board, Prof. Dr. Hans-W. Micklitz (European University Institute) focused on the new culture of interdisciplinary research. “The Advisory Board congratulates the Max Planck Society for its courageous and groundbreaking decision to bring together law and economics under one roof”, Micklitz said. With its new orientation, he noted, the Max Planck Institute for Innovation and Competition is not only following the suggestion of the German Council of Science and Humanities, which has in clear terms stressed the necessity of a stronger interdisciplinarity between the social and the economic sciences, but will also allow the German law and economics disciplines to forge a “link to developments in Europe and the USA”. From the perspective of the legal sciences, the Max Planck Institute for Innovation and Competition is taking on a centurial task – “what the Americans call ‘law and …’: law and social science, law and art, law and music, and now likewise law and economics”, as Micklitz described the challenge. “Collaboration can only succeed by means of a theory-based common methodology”.


Further words of welcome were spoken by Cornelia Rudloff-Schäffer, Chair of the Board of Trustees and President of the German Patent and Trade Mark Office, and Prof. Dr. Bernd Huber, President of the Ludwig-Maximilians-Universität. The key-note speech was held by Professor Peter Drahos, Ph.D., of the Australian National University.


The musical setting for the official ceremony was provided by a very special program: Richard Strauss’ Lieder cycle “Der Krämerspiegel”. This rarely performed work, a series of songs from the year 1918 with lyrics by Alfred Kerr, originated in a dispute between the composer and the music publisher Bote & Bock. Strauss, who fought tirelessly for improvements to copyright law in Germany – and who is also known as the “godfather” of the collecting agency GEMA, in the “Krämerspiegel” (or “Shopkeeper’s Mirror”), satirizes the tense relationship between creators and publishers in mordant aphorisms: “The artists are the creators, Their misfortune is the bloodsuckers” (“Die Künstler sind die Schöpfer, ihr Unglück sind die Schröpfer”). Presenting this “work of revenge in words and music” were soprano Ute Ziemer and Julian Riem on the piano.


Academic Symposium

At the academic symposium in the Max Joseph Hall of the Munich Residence, Director Dietmar Harhoff outlined the challenges arising from the growing significance of the Internet. “Our understanding of innovation up until now has been technology-heavy – but now we are observing that innovation increasingly tends to be rooted in new, Internet-based business models”. Director Prof. Dr. Josef Drexl referred to “competition as an important infrastructure for innovations” in which the principles of use have to be updated constantly, such as in the current topic of big data. Director Prof. Dr. Reto M. Hilty pointed out the discrepancy between the highly dynamic markets with ever new innovative products and the seemingly static instruments for regulating them using proprietary rights. A more competition-oriented conception of IP rights, he argued, would not contradict patent law, but it might take more adequate consideration of the dynamics of the markets, an area that the Institute is to study in more detail in the future.


The Institute’s two departments presented the current state of their research during the full-day event and discussed research strategies and future areas of emphasis with international experts and alumni of the Institute.


An introductory lecture by Dietmar Harhoff on “Innovation and Entrepreneurship” was followed by a podium discussion. The participating panelists were Dr. Heinrich Arnold, Senior Vice President, Telekom Innovation Laboratories, Deutsche Telekom AG; Prof. Petra Moser, Ph.D., New York University School of Business, NYU Stern; and Prof. Dr. Dres. h.c. Arnold Picot, Ludwig-Maximilians-Universität (LMU) Munich. The discussion was moderated by Prof. Dr. Karin Hoisl, Universität Mannheim.


The session entitled “Property” was opened with a key-note lecture by Reto Hilty, which was followed by a podium discussion. The invited panelists were Alison Brimelow, CBE, President emerita, European Patent Office (EPO); Prof. Dan L. Burk, University of California, Irvine School of Law; and Prof. Michel Vivant, Sciences Po Law School, Paris. Prof. Dr. Alexander Peukert, Goethe Universität Frankfurt, led the discussion.


The session on “Innovation in Competition Law” was introduced by Josef Drexl. The participants in the podium discussion following his key-note address were Prof. Michal Gal, University of Haifa School of Law; Prof. Warren S. Grimes, Southwestern Law School, Los Angeles; and Prof. Dr. Kai-Uwe Kühn, Centre for Competition Policy (CCP), University of East Anglia. The session’s moderator was Prof. Dr. Rupprecht Podszun, Universität Bayreuth.


The three main themes were brought together in a final podium discussion. Participants in this debate were, besides the Institute’s three Directors Harhoff, Hilty and Drexl, Heinrich Arnold of Telekom Innovation Laboratories; Petra Moser of the New York University School of Business; Dan Burk from Irvine School of Law; Michel Vivant from Sciences Po Law School; Michal Gal of the University of Haifa School of Law; and Warren S. Grimes of Southwestern Law School. The moderator of the session was Dr. Gert Würtenberger, President of the Deutsche Vereinigung für Gewerblichen Rechtsschutz und Urheberrecht (GRUR).


The academic day ended with summarizing remarks by Peter Drahos of the Australian National University.

Miscellaneous  |  06/15/2016

Press release: Max Planck Institute for Innovation and Competition hosts its first “Journalist in Residence”

Manfred Ronzheimer to investigate the renewal of innovation journalism in Germany.

Manfred Ronzheimer
Miscellaneous  |  05/02/2016

EIPIN awarded grant for European Joint Doctorate

The European Intellectual Property Institutes Network (EIPIN) has been granted EU funding to offer a European Joint Doctorate.

Members of the network, which was founded in 1999 to intensify cooperation between European institutions in the field of intellectual property and their students, are the Munich Intellectual Property Law Center (MIPLC), Queen Mary University of London, University of Strasbourg (CEIPI), Alicante University and Maastricht University.


A total of 15 doctoral candidates will be accepted into the program, which will receive EU funding in the amount of 3.8 million euros over a period of four years. Each of the EIPIN member institutions will supervise three doctoral candidates and act as co-supervisor for three further candidates being advised by one of the other EIPIN member institutions. Also planned in the framework of the doctoral program are internships with leading European organizations in innovative sectors of the economy (e.g. telecommunications, music, seeds) and seminars (e.g. on methodology). Furthermore, participants are intended to participate in the annual EIPIN congress.


EIPIN submitted its proposal, entitled “EIPIN Innovation Society”, in January 2016 within the framework of the EU’s Horizon 2020 program. The goal of the proposal is to investigate the effects of intellectual property rights (IPRs) on the innovation potential of a society as well as how best to design IPRs in order to facilitate and not check innovation.


For EIPIN Member MIPLC the University of Augsburg will be the institution awarding the doctoral degree. The Max Planck Institute for Innovation and Competition, which acted as a supporting institution for the grant proposal and is one of the sponsors of the MIPLC, will collaborate with the University of Augsburg in the running of the program and will provide supervisors for the doctoral candidates.

Miscellaneous  |  04/25/2016

Study “Copyright and Innovation in Digital Markets” presented to Justice Ministry

On 25 April 2016 Prof. Dietmar Harhoff presented the study “Copyright and Innovation in Digital Markets”, which he co-authored with Prof. Reto M. Hilty and Dr. Alexander Suyer, to Federal Minister of Justice and Consumer Protection Heiko Maas.

Dr. Hubert Weis, left, Head of the Commercial and Economic Law Directorate, and Heiko Maas receive the study from Prof. Dietmar Harhoff, Ph.D. Photo: German Federal Ministry of Justice and Consumer Protection

The Ministry had commissioned the Max Plank Institute for Innovation and Competition to prepare the study in order to provide a better empirical basis for legal-political discussions of copyright law in the digital age.


Digitalization is a key driver for innovations and the emergence of new business models. Internet-based value-creation processes are increasingly changing the basic conditions for creativity while at the same time opening up new ways to disseminate and use many different types of content. Accordingly, copyright as a legal instrument to promote innovation and creativity is also confronted with new challenges. Its role in this context must be determined not only from a legal, but also from an economic perspective. Basic groundwork for this task includes charting and analyzing those technological and economic changes that digitalization and interconnectedness entail. Trends regarding technological developments and value-creation models are particularly visible in the kinds of young enterprises that are currently introducing innovative, internet-based business models. If there is a connection between their business models and copyright law, this connection can make it possible to draw conclusions as to which basic legal conditions might influence innovation in digital markets in a positive or a negative way.


For the study, 40 startups with internet-based business models were surveyed, whereby “startup” was defined as an enterprise under ten years old implementing an innovative business model or innovative technology and striving for significant growth. The goal of the interviews with the startups was to determine which parameters of copyright law the entrepreneurs saw as containing a potential for conflict with their own business model. Thus the first step was to determine what role copyright-protected content played in the creation of value and who the authors of this content were. Next, it was ascertained what copyright-related questions, insecurities or risks arose for the startups with regard to this content. Finally, the entrepreneurs were asked how they responded to these challenges in their day-to-day business.


The study was commissioned by the German Federal Ministry of Justice and Consumer Protection and carried out jointly by the Max Planck Institute for Innovation and Competition and the Center for Digital Technology and Management (CDTM). A multidisciplinary analysis taking technical, economic and legal aspects into account, the study reveals many of the challenges faced by German copyright law with respect to innovation in digital markets. The work thus provides an empirical basis for drafting proposals for a reform of German copyright law.

Miscellaneous  |  03/10/2016

Eric von Hippel and the User Innovation Paradigm

"Revolutionizing Innovation: Users, Communities, and Open Innovation" now published by MIT Press.

Harhoff, Dietmar; Lakhani, Karim R. (eds.) (2016). Revolutionizing Innovation: Users, Communities, and Open Innovation. Cambridge, MA: MIT Press. ISBN: 9780262029773.

“Revolutionizing Innovation: Users, Communities, and Open Innovation”, edited by Dietmar Harhoff (Director at the Max Planck Institute for Innovation and Competition) and Karim R. Lakhani (Associate Professor of Business Administration at Harvard Business School), has now been published by MIT Press (https://mitpress.mit.edu).
 

The volume provides a comprehensive and multidisciplinary view of the field of user and open innovation, reflecting advances in the field over the last several decades. The book is dedicated to the economist Eric von Hippel who, since the 1980s, pioneered a groundbreaking view of innovation. Von Hippel shows that in many cases users of products and services create innovations and that subsequently producers take up these innovations and develop them further. Thus he counters the dominant paradigm which casts profit-seeking firms as the main drivers of technological and organizational change. In their research projects, von Hippel and colleagues found empirical evidence that flatly contradicted the producer-centered model of innovation. Large parts of the knowledge economy now routinely rely on user innovation, communities, and open innovation to solve important technological and organizational problems.
 

The contributors to the volume—including many colleagues of Eric von Hippel—offer both theoretical and empirical perspectives from such diverse fields as economics, the history of science and technology, law, management, and policy.
 

On 17 March 2016, 6:00 -8:00 p.m., Eric von Hippel himself will give a lecture about “Free Innovation and the Internet” at the new Munich Center for Internet Research (MCIR) of the Bavarian Academy of Sciences and Humanities addressing the question how the internet modifies innovation. The presentation followed by a discussion can also be watched via live stream (http://www.mcir.badw.de/). The viewers may ask questions via live chat. See also: http://www.ip.mpg.de/en/the-institute/events/free-innovation-and-the-internet.html.

Miscellaneous  |  02/29/2016

Press release: Max Planck Institute for Innovation and Competition: Web Relaunch

With its new homepage, the Munich research institute places its new profile in the spotlight alongside its interdisciplinary work, diverse projects and publications.

Miscellaneous  |  02/17/2016

Commission of Experts for Research and Innovation (EFI) presents annual report 2016 on research, innovation and technological performance in Germany to German Chancellor Merkel

f.l.t.r.: Prof. Dr. Uwe Cantner, Prof. Dr. Monika Schnitzer, German Federal Minister of Education and Research Johanna Wanka, German Chancellor Angela Merkel, Prof. Dietmar Harhoff, Ph.D., Prof. Dr. Uschi Backes-Gellner, Prof. Dr. Ingrid Ott, Prof. Dr. Christoph Böhringer. Photo: Svea Pietschmann

On February 17, 2016, the Commission of Experts for Research and Innovation chaired by Prof. Dietmar Harhoff, Ph.D., Director at the Max Planck Institute for Innovation, has presented the ninth report on research, innovation and technological performance in Germany to the German Chancellor Angela Merkel. The Commission of Experts for Research and Innovation (Expertenkommission Forschung und Innovation - EFI) provides scientific advice to the German Federal Government and periodically delivers reports on research, innovation and technological productivity in Germany. A key task is to provide a comprehensive analysis of the strengths and weaknesses of the German innovation system in an international comparison. Furthermore, Germany's perspectives as a location for research and innovation are evaluated on the basis of the latest research findings. EFI presents proposals for national research and innovation policy.