We Have Too Many Patents, Not Too Few

Moneybox
A blog about business and economics.
July 6 2012 1:16 PM

We Have Too Many Patents, Not Too Few

My latest column is about a new US Patent and Trademark Office initiative to open field offices, which will let them hire more and better patent examiners and process their work more quickly. It sounds nice, except the patent application backlog isn't what's wrong with the US patent system. The problem is far too many patents in areas where government-created monopolies do much more to stifle innovation than bolster it.

Judge Richard Posner said the same thing yesterday in an interview with Reuters:

Posner said some industries, like pharmaceuticals, had a better claim to intellectual property protection because of the enormous investment it takes to create a successful drug.
Advances in software and other industries cost much less, he said, and the companies benefit tremendously from being first in the market with gadgets - a benefit they would still get if there were no software patents.
"It's not clear that we really need patents in most industries," he said.
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I don't think it's clear that we need patents for pharmaceuticals either, but we do needsomething. Proposals to reform pharma patents typically involve some alternative mechanism for financing innovation. I would tax pills and use the money to finance prizes. But the point is that in many industries you could just scrap the patents and that's your solution right there.

It's particularly good to see Posner on this bandwagon because to an extent the conventional wisdom on the patent situation in digital industries has been cleaving along a "geeks vs lawyers" axis of polarization. Posner is a very famous legal scholar, and should help get the geek point of view much-needed exposure in law schools.

Matthew Yglesias is the executive editor of Vox and author of The Rent Is Too Damn High.

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