Intellectual Property Policy Reform

Intellectual Property Policy Reform

Fostering Innovation and Development

Edited by Christopher Arup and William van Caenegem

This state-of-the-art study argues that reforms to intellectual property (IP) should be based on the ways IP is interacting with new technologies, business models, work patterns and social mores. It identifies emerging IP reform proposals and experiments, indicating first how more rigor and independence can be built into the grant of IP rights so that genuine innovations are recognized. The original contributions then show how IP rights can be utilised, through open source licensing systems and private transfers, to disseminate knowledge. Reforms are recommended. The discussion takes in patents, copyright, trade secrets and relational obligations, considering the design of legislative directives, default principles, administrative practices, contractual terms and licence specifications.

Chapter 2: Why Patents Need Reform, and Some Suggestions for It

William Kingston

Subjects: law - academic, intellectual property law


William Kingston There is an emerging consensus amongst users and students of the patent system that it is not performing as it ought to, and that this performance is getting worse. A recent comprehensive analysis of a large number of US empirical investigations concluded that: The performance of the United States patent system deteriorated markedly during the 1990s as the private costs of patent litigation soared. By the late 1990s, the risk of patent litigation for public firms outside of the chemical and pharmaceutical industries exceeded the profits derived from patents. This implies that patents likely provided a net disincentive for innovation for the firms who fund the lion’s share of industrial R&D, that is, patents tax R&D. (Bessen and Meurer 2008, p. 144) And since most other countries, as will be seen below, have replicated the US system, it is a reasonable assumption that this pattern is also the global one. The simple reason why this has happened is that it is nobody’s business to see that patents work properly. Consequently, they have been shaped by the interests of those who could benefit from them, rather than from any vision of the public good. The subtitle of the book from which the above quotation is taken is ‘How Judges, Bureaucrats and Lawyers Put Innovators at Risk’. I. INVESTMENT IN INNOVATION Economic innovation depends upon investment, partly under uncertainty and partly under risk, which is uncertainty quantified. Investment under uncertainty can never be rational at all, and investment...

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