Patents That Kill 240
wabrandsma (2551008) writes From The Economist: "The patent system, which was developed independently in 15th century Venice and then in 17th century England, gave entrepreneurs a monopoly to sell their inventions for a number of years. Yet by the 1860s the patent system came under attack, including from The Economist. Patents, critics argued, stifled future creativity by allowing inventors to rest on their laurels. Recent economic research backs this up."
Re:Absolutely (Score:5, Informative)
Re:Alternatives? (Score:5, Informative)
You replace patents with nothing. Empirical research has shown that patents don't do squat and lead to less overall innovation and wealth creation than without patents.
There are many ways to research it empirically. You can compare/contrast countries where one country disallowed patents in a particular field. You can compare/contrast where one country had a stronger patent regime than another in the same field. (It goes without saying you want to look at countries with similar industrialization levels). You can compare across fields in the same economy by, for example, looking at innovation in a field with weak--or no--IP protection with a field with stronger protections. And you can use historical or contemporary data.
Anyhow, there are many sources of empirical data to judge the efficacy of patent policies. It turns out that when you do rigorous research and look at all the data, patents are a net loss across the board. The only place where patents arguably make sense according to empirical data is in pharmaceuticals, but only because without patents companies provably couldn't afford the regulatory cost imposed upon them by the FDA. But FDA regulation is has been shown to be too strict and unnecessary at current levels. So we'd be better off with a market free of patents (more, cheap drugs with higher efficacy), as long as some other regulations were changed.
You can read a short book describing all the arguments and with a summary of the empirical research. It's called "Against Intellectual Monopoly", and one of the authors also wrote the paper mentioned above.
See http://www.amazon.com/Against-Intellectual-Monopoly-Michele-Boldrin/dp/0521127262/ref=cm_cr_pr_product_top
Free version is here: http://levine.sscnet.ucla.edu/general/intellectual/againstfinal.htm
People love to use hypotheticals to defend patents and IP in general. But at the end of the day it's an empirical question, not a question of theory. Common hypotheticals always have unstated premises which even in classical economics are not necessarily true. When you look at the empirical data, those hypotheticals and their premises are shown to be bogus.