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Interestingly, this analogy works very much at the company level, but reverses at the country level. For companies, patents represent weapons in an arsenal, in

Interestingly, this analogy works very much at the company level, but reverses at the country level. For companies, patents represent weapons in an arsenal, in which MAD prevents offensive action, as you've said. For countries, the reverse holds: a country that jettisons its patent architecture, or never evolved a restrictive one to begin with, will be a bastion for innovators. The stable equilibrium is no bad patents - a lack of shallow protectionism - and the only reason patent law in the US has remained constant for so long is because of the other advantages that have given it technological and scientific primacy. As those advantages erode, patent law will loosen to stimulate competition. Perhaps there is an upside to the perception of decline?

novaleaf 12y ago
A nice hypothesis, do you have any examples that show this to be true? The realist in me bets that innovation has only a weak relationship to IP laws, and rather a strong relationship to a certain world-view that fosters innovation since childhood (go USA!)
- publysher 12y ago
  One real example is the Netherlands and the rise of Philips: http://books.google.nl/books?id=sfoujAT3b_YC&lpg=PA104&ots=BVjEuRBYkx&pg=PA104#v=onepage&q&f=false http://books.google.nl/books?id=sfoujAT3b_YC&lpg=PA104&ots=B...
- poolpool 12y ago
  How does the US foster innovation? It certainly puts the rich (Some of which who were innovators) on pedestals, but the education system certainly does not preach innovation for the first 18 years of a child's life. You could argue that it actually penalizes innovation.
  - novaleaf 12y ago
    I only have two personal anecdotes: My own childhood growing up in Washington State, and my experience in Thailand for the last 7 years. In the USA, we often hear about how our (USA) school systems are too easy/relaxed compared to foreign countries. In Thailand, it's the opposite, in the most terrible way possible. Everything is about test scores, and thus "thinking outside the box" is severely penalized. People in the USA might not have the raw-academics, but the applied problem solving and team collaboration skills absolutely crushes the competition (Though of course that doesn't help manual labor jobs much)
adventured 12y ago
Can you list numerous countries that are examples of not having a restrictive patent system, and subsequently are bastions of innovation? The US economy has been an extreme bastion of innovation for 200 years, while also having a robust patent system (one that has only recently become particularly stifling). In fact I'd argue there has hardly been a greater bastion of innovation in world history than the US economy from 1800 to 2000 or so, very few countries compete for that title. I'm very much not a fan of how the US patent system works today, but I'm finding it difficult to prove your claim based on historical evidence.
- sergiosgc 12y ago
  If you place the USA as innovation leaders in the modern world, you make it very difficult to present an example under similar conditions. You can go back in History, though. Countries involved in world discovery in the 1400-1600 were absolute innovation leaders and required no patent law.
  - TheOtherHobbes 12y ago
    They didn't need patent law, because they had princes and armies. The also had a culture in which information couldn't travel faster than a man (usually a man...) on a horse, and patentable information could only be understood by a few hundred individuals in each country, at most. One of the points of patent law is to distribute the rewards of invention, so individual inventors - not corporations - benefit from their creativity. Patent protections aren't the only element in this, but they're one element, and a lot of 20th century products would never have appeared otherwise. It's simply not historical to argue otherwise. The 21st century works differently, but with the irony that the FOSS people claim their way is absolutely correct, and no other system is workable. Sharing certainly works if you have a day job that pays your bills. But innovation is not invention. Patents were originally designed for creative inventors, not commercial packaging operations like [insert corporate giant here], or freeware mash-up/YetAnotherFramework projects. In the US at least, the system has become a joke. But just because it's broken doesn't mean that inventors shouldn't be rewarded and protected somehow.
- 12y ago
Spooky23 12y ago
I think you need to append "for software or business methods" liberally. For products where development costs dwarf manufacturing costs, patents provide the incentive to do stuff. Would anyone invest a few billion into a drug if anyone with access to a few million bucks could go manufacture it?
- metaphorm 12y ago
  software is a product where development costs (designing the product, writing the code) dwarf manufacturing cost (compiling the code, deploying the executables).
  - comicjk 12y ago
    A developed product is protected by copyright, not a patent. Software patents are for ideas, and the vaguer, the more valuable. Developing an idea like one-click ordering takes virtually no added time; all the better if you can wait for someone else to do the development and then collect the reward.
- steveklabnik 12y ago
  I've always enjoyed "Against Intellectual Monopoly" (read free online here: http://levine.sscnet.ucla.edu/general/intellectual/against.htm http://levine.sscnet.ucla.edu/general/intellectual/against.h... ), which has a chapter (http://levine.sscnet.ucla.edu/papers/ip.ch.9.m1004.pdf http://levine.sscnet.ucla.edu/papers/ip.ch.9.m1004.pdf) that specifically addresses this.
  - throwawaykf05 12y ago
    I would be wary of taking that book at its word. The authors have an agenda and they are not afraid to twist historical facts to suit their narrative. I mean, their very first chapter begins with a lie which perpetuates the myth that Watt's patent retarded steam development [1]. When the authors of [1] called out Boldrin and Levine on this, the latter responded by fabricating new myths rather than admit that the truth undermined their narrative [2]. The very chapter you cite itself has such inaccuracies. I did not track down all the stuff they cite, but I did find an instance of mischaracterizing references to suit their view points. For instance, when they discuss the German dyestuff industry, they cite a study by Murmann to support their narrative that Germany dominated in that industry due to the lack of patents. But if you look at the actual study itself, Murmann paints (heh) a much more nuanced picture. German dominance in that industry was fueled by close ties with academic research, and later by R&D labs encouraged by, of all things, the newly introduced patent laws: >When in 1877 German patent law protected dye innovations, a few German firms such as Hoechst, BASF, and AGFA saw the advantage of hiring organic chemists whose sole task was to synthesize new dyes. After these research chemists turned out economically successful dyes, firms hired more and more chemists and pioneered an entirely new corporate function, formally organized research. The birth of corporate research and development (R&D), which today is a standard activity in high-tech industries ... can be traced to the German synthetic dye firms in 1880s. By the 1890s the vast majority of dyes were being discovered in the R&D laboratories of Bayer, Hoechst, and BASF. > Whereas in the early days of the industry a firm could exist by copying dyes invented somewhere else, patent laws made the systematic application of science within the boundaries of the firm a critical dimension of remaining a leader in the industry. And elsewhere: > The most important institution in the early success of the German dye industry was the university system, but patent laws were a second key factor that allowed the German firms to capture a dominant position. With that many assertions in the study that refute their view, they cherry-pick a few comments and actually cite the study as one that supports their view. With so many mischaracterizations in there, I find it hard to take anything else they say in that book at their word. 1. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1589712 http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1589712 2. http://econpapers.repec.org/article/bpjrlecon/v_3a5_3ay_3a2009_3ai_3a3_3an_3a7.htm http://econpapers.repec.org/article/bpjrlecon/v_3a5_3ay_3a20... 3. Murmann JP, 2003, "Knowledge and Competitive Advantage – The Coevolution of Firms, Technologies and National Institutions." - http://catdir.loc.gov/catdir/samples/cam041/2003043048.pdf http://catdir.loc.gov/catdir/samples/cam041/2003043048.pdf
gaius 12y ago
a country that jettisons its patent architecture, or never evolved a restrictive one to begin with, will be a bastion for innovators. Like, say, Somalia? Your hypothesis is trivially disproved.

novaleaf 12y ago

A nice hypothesis, do you have any examples that show this to be true? The realist in me bets that innovation has only a weak relationship to IP laws, and rather a strong relationship to a certain world-view that fosters innovation since childhood (go USA!)

publysher 12y ago
One real example is the Netherlands and the rise of Philips: http://books.google.nl/books?id=sfoujAT3b_YC&lpg=PA104&ots=BVjEuRBYkx&pg=PA104#v=onepage&q&f=false http://books.google.nl/books?id=sfoujAT3b_YC&lpg=PA104&ots=B...
poolpool 12y ago
How does the US foster innovation? It certainly puts the rich (Some of which who were innovators) on pedestals, but the education system certainly does not preach innovation for the first 18 years of a child's life. You could argue that it actually penalizes innovation.
- novaleaf 12y ago
  I only have two personal anecdotes: My own childhood growing up in Washington State, and my experience in Thailand for the last 7 years. In the USA, we often hear about how our (USA) school systems are too easy/relaxed compared to foreign countries. In Thailand, it's the opposite, in the most terrible way possible. Everything is about test scores, and thus "thinking outside the box" is severely penalized. People in the USA might not have the raw-academics, but the applied problem solving and team collaboration skills absolutely crushes the competition (Though of course that doesn't help manual labor jobs much)

adventured 12y ago

Can you list numerous countries that are examples of not having a restrictive patent system, and subsequently are bastions of innovation? The US economy has been an extreme bastion of innovation for 200 years, while also having a robust patent system (one that has only recently become particularly stifling). In fact I'd argue there has hardly been a greater bastion of innovation in world history than the US economy from 1800 to 2000 or so, very few countries compete for that title. I'm very much not a fan of how the US patent system works today, but I'm finding it difficult to prove your claim based on historical evidence.

sergiosgc 12y ago
If you place the USA as innovation leaders in the modern world, you make it very difficult to present an example under similar conditions. You can go back in History, though. Countries involved in world discovery in the 1400-1600 were absolute innovation leaders and required no patent law.
- TheOtherHobbes 12y ago
  They didn't need patent law, because they had princes and armies. The also had a culture in which information couldn't travel faster than a man (usually a man...) on a horse, and patentable information could only be understood by a few hundred individuals in each country, at most. One of the points of patent law is to distribute the rewards of invention, so individual inventors - not corporations - benefit from their creativity. Patent protections aren't the only element in this, but they're one element, and a lot of 20th century products would never have appeared otherwise. It's simply not historical to argue otherwise. The 21st century works differently, but with the irony that the FOSS people claim their way is absolutely correct, and no other system is workable. Sharing certainly works if you have a day job that pays your bills. But innovation is not invention. Patents were originally designed for creative inventors, not commercial packaging operations like [insert corporate giant here], or freeware mash-up/YetAnotherFramework projects. In the US at least, the system has become a joke. But just because it's broken doesn't mean that inventors shouldn't be rewarded and protected somehow.
12y ago

Spooky23 12y ago

I think you need to append "for software or business methods" liberally. For products where development costs dwarf manufacturing costs, patents provide the incentive to do stuff. Would anyone invest a few billion into a drug if anyone with access to a few million bucks could go manufacture it?

metaphorm 12y ago
software is a product where development costs (designing the product, writing the code) dwarf manufacturing cost (compiling the code, deploying the executables).
- comicjk 12y ago
  A developed product is protected by copyright, not a patent. Software patents are for ideas, and the vaguer, the more valuable. Developing an idea like one-click ordering takes virtually no added time; all the better if you can wait for someone else to do the development and then collect the reward.
steveklabnik 12y ago
I've always enjoyed "Against Intellectual Monopoly" (read free online here: http://levine.sscnet.ucla.edu/general/intellectual/against.htm http://levine.sscnet.ucla.edu/general/intellectual/against.h... ), which has a chapter (http://levine.sscnet.ucla.edu/papers/ip.ch.9.m1004.pdf http://levine.sscnet.ucla.edu/papers/ip.ch.9.m1004.pdf) that specifically addresses this.
- throwawaykf05 12y ago
  I would be wary of taking that book at its word. The authors have an agenda and they are not afraid to twist historical facts to suit their narrative. I mean, their very first chapter begins with a lie which perpetuates the myth that Watt's patent retarded steam development [1]. When the authors of [1] called out Boldrin and Levine on this, the latter responded by fabricating new myths rather than admit that the truth undermined their narrative [2]. The very chapter you cite itself has such inaccuracies. I did not track down all the stuff they cite, but I did find an instance of mischaracterizing references to suit their view points. For instance, when they discuss the German dyestuff industry, they cite a study by Murmann to support their narrative that Germany dominated in that industry due to the lack of patents. But if you look at the actual study itself, Murmann paints (heh) a much more nuanced picture. German dominance in that industry was fueled by close ties with academic research, and later by R&D labs encouraged by, of all things, the newly introduced patent laws: >When in 1877 German patent law protected dye innovations, a few German firms such as Hoechst, BASF, and AGFA saw the advantage of hiring organic chemists whose sole task was to synthesize new dyes. After these research chemists turned out economically successful dyes, firms hired more and more chemists and pioneered an entirely new corporate function, formally organized research. The birth of corporate research and development (R&D), which today is a standard activity in high-tech industries ... can be traced to the German synthetic dye firms in 1880s. By the 1890s the vast majority of dyes were being discovered in the R&D laboratories of Bayer, Hoechst, and BASF. > Whereas in the early days of the industry a firm could exist by copying dyes invented somewhere else, patent laws made the systematic application of science within the boundaries of the firm a critical dimension of remaining a leader in the industry. And elsewhere: > The most important institution in the early success of the German dye industry was the university system, but patent laws were a second key factor that allowed the German firms to capture a dominant position. With that many assertions in the study that refute their view, they cherry-pick a few comments and actually cite the study as one that supports their view. With so many mischaracterizations in there, I find it hard to take anything else they say in that book at their word. 1. http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1589712 http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1589712 2. http://econpapers.repec.org/article/bpjrlecon/v_3a5_3ay_3a2009_3ai_3a3_3an_3a7.htm http://econpapers.repec.org/article/bpjrlecon/v_3a5_3ay_3a20... 3. Murmann JP, 2003, "Knowledge and Competitive Advantage – The Coevolution of Firms, Technologies and National Institutions." - http://catdir.loc.gov/catdir/samples/cam041/2003043048.pdf http://catdir.loc.gov/catdir/samples/cam041/2003043048.pdf

gaius 12y ago

a country that jettisons its patent architecture, or never evolved a restrictive one to begin with, will be a bastion for innovators. Like, say, Somalia? Your hypothesis is trivially disproved.