Patent systems for encouraging innovation: Lessons from economic analysis
Economic theory views patents as policy instruments aimed at fostering innovation and diffusion. Three major implications are drawn regarding current policy debates. First, patents may not be the most effective means of protection for inventors to recover R&D investments when imitation is costly...
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| Published in | Research policy Vol. 35; no. 9; pp. 1423 - 1440 |
|---|---|
| Main Authors | , , |
| Format | Journal Article |
| Language | English |
| Published |
Amsterdam
Elsevier B.V
01.11.2006
Elsevier Elsevier Sequoia S.A |
| Series | Research Policy |
| Subjects | |
| Online Access | Get full text |
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| Abstract | Economic theory views patents as policy instruments aimed at fostering innovation and diffusion. Three major implications are drawn regarding current policy debates. First, patents may not be the most effective means of protection for inventors to recover R&D investments when imitation is costly and first mover advantages are important. Second, patentability requirements, such as novelty or non-obviousness, should be sufficiently stringent to avoid the grant of patents for inventions with low social value that increase the social cost of the patent system. Third, the trade-off between the patent policy instruments of length and breadth could be used to provide sufficient incentives to develop inventions with high social value. Beyond these three implications, economic theory also pleads for a mechanism design approach: an optimal patent system could be based on a menu of different degrees of patent protection where stronger protection would involve higher fees, allowing self-selection by inventors. |
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| AbstractList | Economic theory views patents as policy instruments aimed at fostering innovation and diffusion. Three major implications are drawn regarding current policy debates. First, patents may not be the most effective means of protection for inventors to recover R&D investments when imitation is costly and first mover advantages are important. Second, patentability requirements, such as novelty or non-obviousness, should be sufficiently stringent to avoid the grant of patents for inventions with low social value that increase the social cost of the patent system. Third, the trade-off between the patent policy instruments of length and breadth could be used to provide sufficient incentives to develop inventions with high social value. Beyond these three implications, economic theory also pleads for a mechanism design approach: an optimal patent system could be based on a menu of different degrees of patent protection where stronger protection would involve higher fees, allowing self-selection by inventors. All rights reserved, Elsevier Economic theory views patents as policy instruments aimed at fostering innovation and diffusion. Three major implications are drawn regarding current policy debates. First, patents may not be the most effective means of protection for inventors to recover R&D investments when imitation is costly and first mover advantages are important. Second, patentability requirements, such as novelty or non-obviousness, should be sufficiently stringent to avoid the grant of patents for inventions with low social value that increase the social cost of the patent system. Third, the trade-off between the patent policy instruments of length and breadth could be used to provide sufficient incentives to develop inventions with high social value. Beyond these three implications, economic theory also pleads for a mechanism design approach: an optimal patent system could be based on a menu of different degrees of patent protection where stronger protection would involve higher fees, allowing self-selection by inventors. [PUBLICATION ABSTRACT] Economic theory views patents as policy instruments aimed at fostering innovation and diffusion. Three major implications are drawn regarding current policy debates. First, patents may not be the most effective means of protection for inventors to recover R&D investments when imitation is costly and first mover advantages are important. Second, patentability requirements, such as novelty or non-obviousness, should be sufficiently stringent to avoid the grant of patents for inventions with low social value that increase the social cost of the patent system. Third, the trade-off between the patent policy instruments of length and breadth could be used to provide sufficient incentives to develop inventions with high social value. Beyond these three implications, economic theory also pleads for a mechanism design approach: an optimal patent system could be based on a menu of different degrees of patent protection where stronger protection would involve higher fees, allowing self-selection by inventors. |
| Author | Encaoua, David Martínez, Catalina Guellec, Dominique |
| Author_xml | – sequence: 1 givenname: David surname: Encaoua fullname: Encaoua, David email: encaoua@univ-paris1.fr organization: CES, Université Paris I, MSE, 106-112 Boulevard de l’Hôpital, 75647 Paris Cedex 13, France – sequence: 2 givenname: Dominique surname: Guellec fullname: Guellec, Dominique email: dominique.guellec@oecd.org organization: Organisation for Economic Cooperation and Development (OECD), France – sequence: 3 givenname: Catalina surname: Martínez fullname: Martínez, Catalina email: catalina.martinez@iesam.csic.es organization: Consejo Superior de Investigaciones Científicas (CSIC), Unidad de Políticas Comparadas (UPC), Spain |
| BackLink | http://econpapers.repec.org/article/eeerespol/v_3a35_3ay_3a2006_3ai_3a9_3ap_3a1423-1440.htm$$DView record in RePEc https://shs.hal.science/halshs-00177614$$DView record in HAL |
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| SubjectTerms | Economic analysis Economic theory Economics Economics and Finance Humanities and Social Sciences Incentive mechanism Innovation diffusion Innovations Inventions Inventors License fee Patent subject matter Patentability requirements Policy making Research and development Research policy Sequential innovations Studies Technology policy |
| Title | Patent systems for encouraging innovation: Lessons from economic analysis |
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