Why Patent Law Doesn't Do Innovation Policy

Abstract

Calls for patent law to take on a more explicit innovation policy agenda have recently increased in urgency. There is however a considerable difference between incentive to invent and incentive to innovate in terms of outcome. Institutional dynamics in patent systems based on the incentive to invent premise constrict rationality and decision-making capability to the extent that an injection of externally devised ‘innovation policy’ seems impossible unless also accompanied by far reaching institutional changes. In both US and Europe technology-specific legal standards in patent law and market specific economic analysis in competition law are a natural point of congruence when considering existing institutional dynamics that support innovation.

This short essay looks primarily at European law to analyse the different ways in which patent law is inured to resist the imposition of economic analysis common to competition policy. There are however spaces within current legal rules that lend themselves well to an examination of the sector specific commercial contexts of inventions. These can and ought to be used robustly to better reflect elements of market specific innovation policies.

Keywords: Innovation, Patent law, Competition, Antitrust, Institutionalism, Incentive to invent