Slashdot points us to an article about a new research report, commissioned by a biotech trade group that argues the evidence shows that patents spur innovation, rather than hinder it. However, as some quickly noticed, the report has severe methodological flaws, starting with the fact that it seems to use patent activity as a proxy for innovation. So, it argues that stronger patent law creates more patents (or more funding of patents or more sales/licensing of patents) -- and then claims that clearly there's more innovation. But we already knew that patent laws spur patents. The question -- not answered in the report -- is about the actual impact on innovation.

Just as an example, the report provides some case studies from different countries. In one of them, it talks about how Taiwan basically took the US' Bayh-Dole Act, which encourages the locking up of university research... and shows there was much more patenting afterwards. The report discusses how "impressive" this is:

A 2010 study of the effects of this legislation on university patenting activity provides a concrete and detailed example of the positive effect the introduction of technology transfer mechanisms can have. The study examines patents granted to 174 Taiwanese universities during the period of 2004 to 2009 and compares this to the period preceding it. Strikingly, the study finds a sharp and sustained increase in university’s patenting activity: patenting increased from 446 patents in 2004 to 1,581 by 2009. This is an impressive increase of 354%. As importantly, apart from a slight drop in 2007, this growth has been progressive and sustained year after year.

Yup. So patent laws that expand the coverage of what's patentable and provide incentives for more patents... increase the number patents. What does that say about innovation? Abso-freaking-lutely nothing. And, in fact, if you look at the actual research on the impact of Bayh-Dole in the US, while it similarly increased patent activity, it didn't increase research, and actually held it back. This is because university research is meant to be shared and meant to be discussed and to have others work on it. That's how great research is done: with lots of sharing of information and ideas to spark new thinking. But the Bayh-Dole Act basically told researchers to shut up, keep things secret, and patent the results. Because of that there are a lot more patents, but a lot fewer real breakthroughs, because you no longer have the same information sharing, discussion and openness that created true innovation in the past.