The State Of Innovation Is Not Defined By The State Of Our Patent Trolls
from the separating-out-the-realities dept
I had been debating whether or not it was worth actually writing anything about President Obama’s State of the Union address earlier this week but had mostly decided to skip it. It was full of vague promises — some of which sounded good, but most of which were woefully short on details. I was slightly surprised that President Obama did not make any real reference to intellectual property laws as being a key driver of innovation — though, from his comments in the past, it appears he does believe that to be the case. The one time he mentioned any sort of intellectual property by name — patents, in this case — he did make a statement that made no sense and I debated writing up something on it.
However, as Dave H informs us, Matt Yglesias did the work for me, and wrote basically the post I would have written about why President Obama’s line about patents in the State of the Union was misleading. It’s the only mention of patents or copyrights at all, and the statement is simply:
“No country has more successful companies, or grants more patents to inventors and entrepreneurs.”
This makes the same fundamental mistake that we discussed in which USPTO boss David Kappos seems to think that China deciding to get more patents means that it’s being more innovative. Yglesias makes the point quite well:
The bigger issue is that the quantity of patents the government hands out to inventors and entrepreneurs is measuring two different things simultaneously. One is how many new ideas do inventors and entrepreneurs send in patent applications for. The other is how loosey goosey does the patent office get about what it deems patentable…
To offer an analogy that I actually think isn’t stretched at all, but 21st century standards Isaac Newton should have patented calculus (“A Method For Using Fluxions To Determine Instantaneous Rate of Change”) and then waited patiently until Leibniz published his superior method and then sued the pants off anyone who tried to take a derivative without coughing up a hefty license fee. But would that world have been a better place? The issue isn’t really so much the rents that Newton would have thereby extracted (I’m not going to begrudge one of human history’s greatest geniuses a fortune) but the barriers to entry that would have been created as a secondary consequence. A world in which smart people have access to the stock of existing human knowledge and are free to apply it in new ways is a world of competition and innovation. A world where you need to consult with an army of lawyers first isn’t. If you ask the people who care most about promoting entrepreneurship in America about this they kind of shrug, concede that the patent system is hopelessly broken, and then confess to despair that it can or will be fixed.
In a broader sense, a lot of our politics is about symbolism. And symbolically intellectual property represents itself in the contemporary United States as a kind of property–it’s right there in the name. But it’s better thought of as a kind of regulation. Patents and copyrights are modeled, economically, the same as you would model any state-created monopoly.
Excellent point. The one thing I’d add is that if the number of patents is really being used as a metric for innovation or competitiveness, then that’s easy to fix: just approve lots more patents (oops that’s being done). Taken to a logical extreme, you just approve every application that comes in and you’ll clearly have more patents than everyone else (and it will likely encourage even more people to “patent” stuff, knowing that they’ll get such a monopoly, right?). So, under that scenario, you’ll certainly have more patents than anyone else in the world… but would it make the economy more innovative? I don’t think anyone could reasonably argue yes. The number of patents measures the number of patents. It does not measure innovation or competitiveness, and it’s wrong, misleading and dangerous to imply otherwise.