Patents and the Regress of Useful Arts

Abstract:     
Patent systems are often justified by an assumption that innovation will be spurred by the prospect of patent protection, leading to the accrual of greater societal benefits than would be possible under non-patent systems. However, little empirical evidence exists to support this assumption. One way to test the hypothesis that a patent system promotes innovation is experimentally to simulate the behavior of inventors and competitors under conditions approximating patent and non-patent systems. Employing a multi-user interactive simulation of patent and non-patent (commons and open source) systems ("The Patent Game"), this study compares rates of innovation, productivity, and societal utility. The Patent Game uses an abstracted and cumulative model of potential innovations, a database of potential innovations, an interactive interface that allows users to invent, make, and sell these innovations, and a network over which users may interact with one another to license, assign, infringe, and enforce patents. Initial data generated using The Patent Game suggest that a system combining patent and open source protection for inventions (that is, similar to modern patent systems) generates significantly lower rates of innovation (p<0.05), productivity (p<0.001), and societal utility (p<0.002) than does a commons system. These data also indicate that there is no statistical difference in innovation, productivity, or societal utility between a pure patent system and a system combining patent and open source protection.

Keywords: Patent, patent law, patent system, patent clause, intellectual property, innovation, open innovation, commons, technological innovation, invention, game, simulation, empirical, productivity, social utility, license, infringement, enforcement, economic experiment

JEL Classifications: K10,K11,K12,K19,K20,K21,K22,K23,K29,K30,K31,K32,K33,K39,K40,K41,K42,K49

Accepted Paper Series