Critic of Software Patents Wins Nobel Prize in Economics

doom writes "You've probably already heard that the Nobel Prize for Economics was given to three gents who were working on advances in mechanism design theory. What you may not have heard is what one of those recipients was using that theory to study: 'One recent subject of Professor Maskin's wide-ranging research has been on the value of software patents. He determined that software was a market where innovations tended to be sequential, in that they were built closely on the work of predecessors, and innovators could take many different paths to the same goal. In such markets, he said, patents might serve as a wall that inhibited innovation rather than stimulating progress.' Here's one of Maskin's papers on the subject: Sequential Innovation, Patents, limitation (pdf).

Thats all nice, but

[should_be_linear]

since when geniuos minds play any significant role in politics? I imagine politician thinking "This guy would would give me half a million if I support software patents BUT there is this famous research study... Oh god, if I only could support both!".

Re:Not Nobel Prize in Economics

[djmurdoch]

Honestly any economist who doesn't recognize the value of creating and protecting intellectual property rights in an information economy is a POORLY trained economist.

As far as I can see, Maskin isn't against IP, only patents. His article says "copyright protection for software programs (which has gone through its own evolution over the last decade) may have achieved a better balance than patent protection." Copyright is IP too.

Re:Not Nobel Prize in Economics

[jimstapleton]

there's a value in creating and protecting it, yes, but there is also a penalty in hoarding it.

In these third world countries, the leadership can be fairly well off - the problem is that all of the wealth is congealed into a very small space.

A balance is needed, as with anything.

Re:Nobel Validity

[Anonymous Coward]

Here is a quote from the official statement put out by the committee on why Gore was selected:
"Extensive climate changes may alter and threaten the living conditions of much of mankind. They may induce large-scale migration and lead to greater competition for the earth's resources. Such changes will place particularly heavy burdens on the world's most vulnerable countries. There may be increased danger of violent conflicts and wars, within and between states."

One point a lot of people are missing is that often the prize has gone into people's efforts towards peace and not their accomplishment at providing peace. It is almost a sort of encouragement to continue their work. Sometimes it doesn't always go that way.

Another point is that Arafat was not a dictator, he couldn't have been as their is no Palestinian State. He was handpicked to lead the Palestinian Authority by the west and Israel (big mistake). He was given the prize for his combined efforts with Israeli leaders back then towards trying to form a peace deal - it was an acknowledgement and encouragement for his efforts. In the end he failed woefully. That in no way diminishes or invalidates the prize.

Re:Not Nobel Prize in Economics

[A beautiful mind]

Seconded. The Nobel Prize in Economics is NOT a real Nobel, and is awarded by the socialist Swedish central bank. Their awards are biased.

Honestly any economist who doesn't recognize the value of creating and protecting intellectual property rights in an information economy is a POORLY trained economist. Hernando de Soto has pegged a lack of real property rights as the primary issue that prevents wealth from being created in the third world (agricultural economies). It follows that in economies (such as the US/Europe) which derive their wealth, more and more, from intellectual property, that the ability to protect those rights is ultimately to our benefit.

Not to rain on your parade but you seem pretty biased or to be more accurate parroting certain right-wing dogmas. Intellectual property doesn't exist. It is an umbrella term at best, but mostly it is a word designed to mislead and cause confusion. The value created by creating and protecting patents and to a lesser extent copyrights is seriously outweighed by the bad effects of giving a monopoly on specific information or methods to private companies or persons.

Copyright and patents do not create wealth, they make all of us poorer, because they tend to inhibit progress as the professor who got the Nobel has shown in the specific case of patents and the IT industry.

Also, quoting wikipedia:

The Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel (Sveriges Riksbanks pris i ekonomisk vetenskap till Alfred Nobels minne), usually called the "Nobel Prize in Economics", is a prize awarded each year for outstanding intellectual contributions in the field of economics. The prize is generally considered the most prestigious honor in economics.

I guess I'll be devils advocate...

[distantbody]

(emphasis mine)

He determined that software was a market where innovations tended to be sequential, in that they were built closely on the work of predecessors, and innovators could take many different paths to the same goal. In such markets, he said, patents might serve as a wall that inhibited innovation rather than stimulating progress.

...That still leaves the opposition with plenty of wiggle room; they don't exactly sound like the words for an open-and-shut case...

This may not lead to patent reform very soon

[Anonymous Coward]

The USofA makes a lot of money selling its IP to the rest of the world. Getting countries like China to play nice with our copyrights and patents is a 'big deal'. It is therefore unlikely that Uncle Sam will soften his position on either. Mickey Mouse will be copyrighted forever. Ridiculous patents will still be granted and enforced. Patent trolls will continue to get rich.

The trouble with the above is that innovation will move to other countries and America will be left behind. I can easily envisage a scenario where Linux is driven out of America by a patent troll for instance. The rest of the world will abandon Microsoft and that revenue stream will dry up.

The only way we can keep ahead of the rest of the world is by fostering innovation. That requires a lot of legal reform. I just don't think the entrenched interests are willing to let it happen in a timely manner.

Re:Has anyone else noticed...

[knight24k]

But when a software product progresses with little or no competition to speak of, it's innovation stops, it gets bigger, slower and more bloated.

I guess that explains Vista.

Re:Not Nobel Prize in Economics

[Tim C]

Of course you realise that every single one of those economies started out by vigorously ignoring IP, especially that of other nations, until such time as it had some of its own to protect and only then implemented its own IP-related laws, don't you?

You do also realise that there are many other factors in why the US and Europe, Japan, etc are more prosperous than third world countries, don't you, and that blaming it all on a lack of IP laws is simplistic almost beyond belief?

What is obvious to the dev community...

[zullnero]

Is mindblowing to the average person. This is the sort of paper that really needs to be distributed as much as possible (but rewritten to be understandable to the layman), because there really needs to be a great deal of political support for such an exemption from the patent process here. The biggest problem is that the software industry has already defined a piece of software as a patentable product, similar to a car or a monitor, and the general populace believes that to be true. However, you don't make a new car by tearing out the carburetor of a 1995 Ford, clean it up, add a couple parts from a 2002 Chevy to it, and stick it into your new car. However, that is precisely how software is generally made. There's your layman's explanation right there.

Re:Has anyone else noticed...

[foniksonik]

Have you looked at DNA lately? In the ancient bacteria, fossil fishes and fungi of the world the DNA is svelte and cleanly coded.... all streamlined to do a few tasks very efficiently, then move forward a few billion years and you get rats and primates.... all bloated with junk and things like consciousness that are completely unnecessary to survival, just bells and whistles really.

I'm not sure what it is you're arguing against.. sounds like you're agreeing with parent post 100% ;-p

p.s. so when is the bloat in our software going to self-actualize and become our computer's soul? I hope it's not based on Windows... what a freakin mess that would be, all freaked out about security, indecisive and completely self-conscious about being genuine... ugh it probably WILL be windows, that sounds like 99% of the people I know.

Analogy is not identity

[Nicolas MONNET]

IP is not the same as physical property, but the concept of owning an abstract thing (the monopoly granted by the patent) is pretty closely related to the concept of owning a physical thing.

Analogy is not identity. Although I guess it depends on what the meaning of "is" is. Or something.

And the analogy breaks even more when you try to stretch it.

Re:Not Nobel Prize in Economics

[DanielJosphXhan]

It would follow if the two were remotely the same thing.

But of course they're not. Intellectual property is only useful and valuable when it assists in the creation of real-world value, the very thing that third-world countries neglect.

Other than that, intellectual property has no value. No scarcity, none of the properties that make real-world property valuable.

The only value it can have, then, is the value that we (or they, or whomever) force upon it. IP can have value only by collective agreement. And, unlike real property and real things, that agreement very easily be broken and cannot be easily enforced, making even the agreement worthless.

Unless, of course, everyone is completely honest and law-abiding.