Factors Affecting the Power of Patent Rights

Abstract

In this paper, we identify three policy instruments governments have at their disposal to affect the power of patent rights to prevent imitation: the size of the inventive step used to make the patent granting decision, the rigour of the patent examination process and the predisposition of the courts to affirm the patent office's decision. We develop a simple framework to analyse the effects of changing these policy instruments on ex ante investment in invention in the light of recent concerns about the potential effects of socially undesirable patents.