DRAFT WORKING PAPER

Historical analysis of the development of semiconductor industry in Silicon Valley shows that patenting and licensing policies have had a profound impact on the evolution of ICT industry and regional growth. Weak intellectual property rights and social networks with strong ties seem to underlie the growth dynamic in Silicon Valley in the 1950s and 1960s. Independent of institutional and social factors, a key developmental factor has also been the exceptional technological trajectory of semiconductors. Software technology has many similarities with semiconductor technology. One may therefore ask, what an analysis of the history of the development of semiconductor industry could tell us about the future of software industry. In particular, an interesting question is whether institutional characteristics, including the regime of intellectual property rights, could be organized so that rapid growth would be possible in software industries in the future. 1 The views expressed in this draft working paper are intended to promote discussion and research. They do not represent the views of the Joint Research Centre, th