Wednesday, April 24, 2013

The Case Against Patents


The Case against Patents 
Michele Boldrin and David Levine 
Journal of Economic Perspectives, Winter 2013, Pages 3-22 

Abstract: The case against patents can be summarized briefly: there is no empirical evidence that they serve to increase innovation and productivity, unless productivity is identified with the number of patents awarded — which, as evidence shows, has no correlation with measured productivity. Both theory and evidence suggest that while patents can have a partial equilibrium effect of improving incentives to invent, the general equilibrium effect on innovation can be negative. A properly designed patent system might serve to increase innovation at a certain time and place. Unfortunately, the political economy of government-operated patent systems indicates that such systems are susceptible to pressures that cause the ill effects of patents to grow over time. Our preferred policy solution is to abolish patents entirely and to find other legislative instruments, less open to lobbying and rent seeking, to foster innovation when there is clear evidence that laissez-faire undersupplies it. However, if that policy change seems too large to swallow, we discuss in the conclusion a set of partial reforms that could be implemented. 

Nod to Kevin Lewis

3 comments:

pkd said...

I thought it said "The Case Against Parents". "...there is no empirical evidence that they serve to increase innovation and productivity..." made a certain amount of sense.

Unknown said...

What about the property rights of the inventor?

Anonymous said...

@Anon: Those 'rights' (which - except for the specific prototypes physically produced by the inventor - are just legal privileges) are what are under discussion. There's plenty of evidence that actual innovation isn't much increased by patents, while rent-seeking is.

Curious how the authors deal with the effect on the domestic American economy if cheaper producers are given access to full rights to reproduce IP, though.