51 Data from the USPTO shows that leading companies in the most productive services, activities took out few patents as can be seen from Table 3 .11. The firm with the most patents is Target, a retailer, with 441 patents since 1976. By comparison, during the same period, IBM was granted more than 49,000 patents, GE more than 27,000, and Intel – a relatively young firm compared to the first two – more than 16,000. Table 3.11: Patents Granted to Services-Oriented Firms Firms Cumulative Number of Patents since 1976 Accenture 284 Goldman Sachs 50 JP Morgan 29 General Electric Capital 45 Citibank 112 American Express Travel 181 GE CAPITAL COMMERCIAL FINANCE 16 UNITED PARCEL SERVICE OF AMERICA 210 Fedex Corporation 3 BANK ONE, DELAWARE, NATIONAL ASSOCIATION 8 THE CHASE MANHATTAN BANK 31 CITICORP DEVELOPMENT CENTER 56 GE CORPORATE FINANCIAL SERVICES 6 VISA INTERNATIONAL SERVICE ASSOCIATION 59 REUTERS LIMITED 32 RESTAURANT SERVICES 6 Wal-Mart 15 Target 441 Note: Patent search was conducting using the above assignee names. Data current as of October 28, 2008 Source: USPTO (). Empirical findings have pointed to the high returns that accrue from R&D and also the relationship between R&D and technological change which feeds GDP growth 50 This might be linked to the strength of labor unions and other laws protecting small services providers. 51 While process innovations associated with investment in IT hardware led to positive productivity growth for the financial sector, the financial crisis of 2008 calls into the question of the merit of a number of product innovations in financial sector (and the effectiveness of data mining techniques), especially that of derivatives ("Wind Down" 2009). 33
(Wieser 2005). Not all activities stimulate R&D because in many, the scope for conducting formal research is relatively small. Most services fall into this category as do a number of light industries. Figure 3 .8 shows the R&D intensities (measured by R&D spending as a share of sales) among different subsectors based on top 1,000 R&D spenders globally, and Figure 3 .9 which uses data from 10 leading OECD countries presents the variation in research intensity across a range of subsectors. Clearly, the manufacturing industries led by office and computing machinery are in the forefront followed by pharmaceuticals and machinery and transport equipment. In fact, the bulk of R&D spending is in just three areas, electronics, pharmaceuticals (including biotechnology) and machinery and equipment of all kinds, particularly automotive equipment (see Figure 3 .10). The auto industry will remain one of the most research intensive and one where the scope for innovation is wide for a number of reasons. First, the development of commercially viable “clean” automobiles will absorb a large volume of R&D in hybrid, electric, and fuel cell technologies plus other alternatives.
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