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Patent Carrots and Sticks: A Model of Nonobviousness

Lewis & Clark Law Review, Vol. 12, p. 549, 2008

Boston Univ. School of Law Working Paper No. 09-17

32 Pages Posted: 26 Jun 2008  

Michael J. Meurer

Boston University - School of Law

Katherine J. Strandburg

New York University School of Law

Date Written: June 24, 2008

Abstract

The authors develop an informal model of the impact of the nonobviousness standard on the choice of research projects. Previous models assume that the basic question confronting a researcher is, "Shall I produce this particular invention?" More realistically, the authors think a researcher asks, "Which research path shall I pursue?" The model shows that a patent serves as a carrot to induce the choice of more difficult projects than would be pursued under the no-patent alternative. The nonobviousness standard serves as a stick to prod researchers to choose even more difficult projects. The results of the model help us understand why a fact-intensive issue like obviousness is a question of law. The model also helps us understand the optimal relationship between the nonobviousness standard and patentable subject matter exclusions. Commentators often suggest subject-matter exclusions are unnecessary if the nonobviousness standard is used appropriately. The authors' model suggests this intuition is wrong for inventions characterized by large social spillovers and high social costs of patenting; a simple subject matter exclusion would be more efficient.

Keywords: obviousness, nonobviousness, patent, subject matter, question of law, question of fact, 102

JEL Classification: K20, K29

Suggested Citation

Meurer, Michael J. and Strandburg, Katherine J., Patent Carrots and Sticks: A Model of Nonobviousness (June 24, 2008). Lewis & Clark Law Review, Vol. 12, p. 549, 2008; Boston Univ. School of Law Working Paper No. 09-17. Available at SSRN: https://ssrn.com/abstract=1150741

Michael J. Meurer

Boston University - School of Law ( email )

765 Commonwealth Avenue
Boston, MA 02215
United States
617-353-6292 (Phone)
617-353-3077 (Fax)

Katherine J. Strandburg (Contact Author)

New York University School of Law ( email )

40 Washington Square South
New York, NY 10012-1099
United States

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