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Economists Argue Patent System Should Be Abolished

Unknown Lamer posted about a year and a half ago | from the cold-war dept.

Patents 376

nukem996 writes "Two economists at the St. Louis Federal Reserve have published a paper arguing that the American patent system should be abolished. The paper recognizes the harm the current patent system has caused not only to the technology sector but the health sector as well."

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376 comments

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Been saying that... (5, Insightful)

MitchDev (2526834) | about a year and a half ago | (#42808013)

For years, but ain;t gonna happen. The big corps will buy the senators and reps to make sure it NEVER happens.

Re:Been saying that... (1, Insightful)

cshark (673578) | about a year and a half ago | (#42808051)

There are industries where a severely limited patent system makes sense. Any industry that's too tightly regulated by government, so that barrier to entry is impossible, like pharma or telecom. Of course you could solve the same problem by pealing back the red tape as well. Competition in the free and open market is the only thing that truly breeds innovation. No free market, no competition. It's easy.

Re:Been saying that... (3, Insightful)

tyrione (134248) | about a year and a half ago | (#42808433)

There are industries where a severely limited patent system makes sense. Any industry that's too tightly regulated by government, so that barrier to entry is impossible, like pharma or telecom. Of course you could solve the same problem by pealing back the red tape as well. Competition in the free and open market is the only thing that truly breeds innovation. No free market, no competition. It's easy.

You live in a deluded fantasy that free market and zero regulation means honest brokers and business ventures. Grow up and get passed Friedman's fallacy along with Ayn Rand.

Re:Been saying that... (0, Troll)

Anonymous Coward | about a year and a half ago | (#42808453)

Please explain how free market is a fallacy.

Please also cite your sources and please, don't use ad-hominem attacks, they only make you come off like an idiot/asshat which, I am sure you are not.

Re:Been saying that... (4, Informative)

hedwards (940851) | about a year and a half ago | (#42808715)

Because it's never existed, never will exist and even Adam Smith saw that the government was going to have to be involved to keep the actors honest. And it should be obvious to anybody who's actually dealt with corporate enterprises that they're more interested in the immediate profits than what they can profit from a few years down the road. Assuming that they're not planning to dismantle the outfit and sell it off chunk by chunk.

Re:Been saying that... (2, Insightful)

arth1 (260657) | about a year and a half ago | (#42808889)

Please explain how free market is a fallacy.

In a completely free market, the big fish will eat the small, and the player with the deepest pockets can own it and become a monopoly.
With a monopoly, the market forces cease to have meaning.

And this is indeed what we see - the biggest become bigger, and the small have no chance of competing, only of being bought and closed down so the monopolies and oligopolies can be maintained.

Re:Been saying that... (4, Insightful)

hsmith (818216) | about a year and a half ago | (#42808923)

Yeah, IBM will always be the biggest PC manufacture. K-Mart will always be the largest box store. Hechts will always be one of the largest clothers. Kodak will always be the leader in film. Yep, big companies only get bigger!

Re:Been saying that... (3, Informative)

beelsebob (529313) | about a year and a half ago | (#42809081)

IBM, K-Mart, Hechts and Kodak didn't operate in free markets. They operated in regulated markets that enforced the lack of monopolies, along with other things that are detrimental to economic growth that the free market allows.

Re:Been saying that... (0)

Anonymous Coward | about a year and a half ago | (#42808593)

Nowhere in his post was "zero regulation" mentioned. That's your own strawman right there.

Re:Been saying that... (2)

LordLimecat (1103839) | about a year and a half ago | (#42808623)

Believing that capitalism generally works (it does, and this is historically verifiable) doesnt mean youre in bed with Ayn Rand or that it makes all involved moral actors.

He spoke of competition and innovation, not honest brokers. The beauty of capitalism is that it doesnt matter if youre honest or not, if you provide crappy service you will be out competed.

Re:Been saying that... (2)

XxtraLarGe (551297) | about a year and a half ago | (#42808687)

You live in a deluded fantasy that free market and zero regulation means honest brokers and business ventures. Grow up and get passed Friedman's fallacy along with Ayn Rand.

Your use of straw man arguments is an obvious sign of maturity...

Re:Been saying that...Wrong, Simply Wrong. (4, Insightful)

BoRegardless (721219) | about a year and a half ago | (#42808827)

Wrong, wrong, wrong. You are obviously not in the medical business.

No CAT Scan, MRI or Cancer drugs would have been invented without patents to give the inventors time to make their years of investment back by a period of exclusivity. Regulation by the government (mostly for safety & efficacy) is just another business expense, like fuel, that all players pay. The price to enter the game.

I have spent over $1m with my partner over 5 years to develop a product and get it FDA cleared for sale with 3 patents. We simply would not have started this project without knowing we could patent what we do, because otherwise J&J and P&G would both copy our product starting the day we released it publicly.

There would then be almost no way to make our investment back at that point, without patents.

P&G and J&J can compete with us, but they can't do it by just copying. They will have to invent something even better that gets the results a different way. That is progress. Mankind has progressed this way at the fastest rate in the history of man, and virtually all of it in the last 200 years. Patents drive innovation. Ordinary citizens benefit from the release from drudgery as a result. It only took about a century to relieve about 80% of the population involved in hard physical farm work down to 5% of the population in farm work, supported mostly by farm machinery inventions.

I am sick of the lack of knowledge (lack in the education system) of how mankind has advanced and how the business process aids new products when people can spend years of hard work and spending of large sums of money with no guarantee at all of success, but knowing that if they can get limited time protection for their work they can then have a chance to profit.

Re:Been saying that...Wrong, Simply Wrong. (0)

Anonymous Coward | about a year and a half ago | (#42809085)

I am sick of the lack of knowledge (lack in the education system) of how mankind has advanced and how the business process aids new products when people can spend years of hard work and spending of large sums of money with no guarantee at all of success, but knowing that if they can get limited time protection for their work they can then have a chance to profit.

You are sick because the education system does not promote your ideology?

"pealing"... (0)

Anonymous Coward | about a year and a half ago | (#42808831)

LOL.

Re:Been saying that... (2)

moderatorrater (1095745) | about a year and a half ago | (#42808951)

Of course you could solve the same problem by pealing back the red tape as well

In pharma, that red tape is known as "making sure the drug doesn't outright kill you." It's not perfect and it's currently being gamed, but the red tape is absolutely necessary.

The other problem with pharma is that the red tape is only necessary for the first person to do it. Thus, if the patent system goes away but the red tape stays there, then innovation will disappear completely because everyone will jump on the new drugs with generics and no need to recoup the costs of making sure it doesn't kill people.

There are things that need fixing with pharma, but simply eliminating red tape and patents certainly won't do it.

Re:Been saying that... (0)

Anonymous Coward | about a year and a half ago | (#42808073)

Or someone will listen to the other economists who disagree with these two

you have that backwards (4, Interesting)

fascismforthepeople (2805977) | about a year and a half ago | (#42808091)

The big corps will buy the senators and reps to make sure it NEVER happens.

You have that exactly backwards. Large corporations would prefer to have no patent system at all. To a large corporation a patent is a barrier to profit. A patent prevents a large company from making a cheap clone of an existing product and selling it to unsuspecting consumers at a profit. The reason why companies are buying up each others' patents is only to protect themselves; they would just as soon see the patent system go away entirely. It has brought about an arms race between companies, where none of the participants actually want to partake in the race - however they can't afford to abandon it either unless they know everyone else will do the same. And the only way to know that is to have everyone forced to do it.

Re:you have that backwards (4, Insightful)

lorenlal (164133) | about a year and a half ago | (#42808419)

I think a middle ground is the more prudent course of action. I actually wonder if this suggestion was put out there as a starting point to begin negotiations. I'd certainly love to see us do away with software (since that's copyright IMHO), and business practice patents. But, I'm willing to bet that there are still plenty of justifiable reasons to keep patents for new inventions. I'm also sure we can reasonably debate how long these patents should be good for, and also address the processes of attaining one.

I don't think the *only* reason companies are buying up other patents are for protection. I think we all know some cases where they're being bought up for the purpose of going on the offensive. There are also many patents out there that are even serving their original intent too, I'm sure.

Re:you have that backwards (1)

fascismforthepeople (2805977) | about a year and a half ago | (#42808631)

I don't think the *only* reason companies are buying up other patents are for protection. I think we all know some cases where they're being bought up for the purpose of going on the offensive.

In business sometimes people go on the offensive to protect themselves. If they can file a lawsuit before their competitor, they can actually reduce their own legal costs in the course of doing so as they don't have to wait for court documents to reach them and pay their attorneys to evaluate them.

In other words, the first move has a distinct advantage in many legal proceedings.

Re:you have that backwards (1)

Runaway1956 (1322357) | about a year and a half ago | (#42808947)

Yes, and most of those "defensive offensive" suits are filed in East Texas, coincidentally, right?

Come on, think. Why do the more legitimate corporations NEED a defense? The only reason they need defenses, is because there are scumbags out there trying to get rich off of other people's work, and other people's investments. There are predatory people who have incorporated themselves, with the sole purpose of finding, and acquiring useless, stupid, obvious patents, for the purpose of raping legitimate businesses.

If you can't name a patent troll in less than two minutes, then you're not competent to use Google.

The best thing that could happen to businesses, worldwide, is that tomorrow morning, all software and process patents were declared null and void. Real patents all downgraded to ten or fifteen years duration, preferably ten.

Copyright law needs to be stood on it's head as well.

I approve of both patents, and copyright. If they were fixed, I would begin to respect the legal systems that surround them. As things stand, I have zero respect for any of it. Zero.

Re:you have that backwards (2, Insightful)

Anonymous Coward | about a year and a half ago | (#42808477)

I'll take some of whatever you're smoking. Patent law is overwhelmingly used for offensive strategies, as opposed to defensive strategies (as you claim). And the vast majority of invocations of patent law are performed by mega-corporations, rather than the little guy (as you claim).

It is almost too ironic that you told the guy above you that he "has it backwards".

Re:you have that backwards (1)

Anonymous Coward | about a year and a half ago | (#42808823)

The big corps will buy the senators and reps to make sure it NEVER happens.

You have that exactly backwards. Large corporations would prefer to have no patent system at all. To a large corporation a patent is a barrier to profit. A patent prevents a large company from making a cheap clone of an existing product and selling it to unsuspecting consumers at a profit. The reason why companies are buying up each others' patents is only to protect themselves; they would just as soon see the patent system go away entirely. It has brought about an arms race between companies, where none of the participants actually want to partake in the race - however they can't afford to abandon it either unless they know everyone else will do the same. And the only way to know that is to have everyone forced to do it.

Tell that to apple

Re:you have that backwards (0)

Anonymous Coward | about a year and a half ago | (#42808939)

It seems there was a gentlemen's agreement in the PC software industry not to wage war based on patents in the early days; not many were even filed. That lasted until the mid-90s or so, then after the web took off companies went crazy filing patents for everything anyone could think of. Companies like IBM rely on patent licensing as a large stream of income.

Re:you have that backwards (1)

nedlohs (1335013) | about a year and a half ago | (#42808989)

Yes. Large pharma companies famously hate the patent system. They would much rather generic versions of their new drugs be available as soon as they get FDA approval. All that lobbying Pfizer has done to get patent laws strengthened and to try to convince the US government to pressure other countries not to allow generic nelfinavir was in some parallel universe.

Re:you have that backwards (1)

fascismforthepeople (2805977) | about a year and a half ago | (#42809065)

Yes. Large pharma companies famously hate the patent system

Big pharma is undoubtedly the largest exception to that, although they could be convinced otherwise. If you told them that tomorrow they could start releasing any drug they want without testing, but in trade they had to agree to abolition of the patent system, they would jump at the opportunity.

Re:you have that backwards (0)

Anonymous Coward | about a year and a half ago | (#42809005)

You have that exactly backwards. Large corporations would prefer to have no patent system at all.

How many large corporations are campaigning for that? Google maybe to some degree (though not I think "at all"), who else?

Re:Been saying that... (0, Funny)

Anonymous Coward | about a year and a half ago | (#42808335)

Economists Argue Patent System Should Be Abolished

Meanwhile, a group of Very Rich White Guys(tm) directly abusing the patent system argue that "if those economists were so good at their jobs, they'd be richer and whiter than they are, and thus here's our campaign contributions to ensure this never happens".

When questioned about the ambiguous syntax and whether this meant abolishing the patent system would never happen or if the economists would never become richer or, in the Very Rich White Guys'(tm) words, "whiter", the VRWG simply stared back at this reporter with angry glares on their faces and took note of the website for whom I report, getting their checkbooks ready and speed-dialing congresspeople.

Re:Been saying that... (1)

LordLimecat (1103839) | about a year and a half ago | (#42808639)

Hooray for racism in disguise! Why, exactly, does it matter whether these villains of yours are white or not?

Watch... (2, Insightful)

MickyTheIdiot (1032226) | about a year and a half ago | (#42808037)

They're careers will be systematically destroyed.

Not to mention what they say, even if perfect in its documentation and rationality, will just be ignored.

Economists that don't toe the corporate line of thinking get booted.

Re:Watch... (4, Funny)

MickyTheIdiot (1032226) | about a year and a half ago | (#42808053)

Just to head off the obvious troll being obvious.. I messed up and did not use the proper version of "their." Soooo sorry.

Re:Watch... (0)

Anonymous Coward | about a year and a half ago | (#42808973)

*blink* I was confused for a minute. GP is an obvious troll but you're talking about someone "trolling" by correcting your spelling. Actually, that's tedious and pedantic, but not trolling. While "they're [sic] careers will be systematically destroyed" is trolling - it's non-relevant, controversial, backed up with no justification and basically just put out there as "fact" when at best it's (fairly paranoid) opinion.

Economists' real problem is a complete lack of empirical knowledge. The paper says innovation doesn't accelerate with number of patents. Irrelevant. Plenty of systems improve with addition of X, but don't improve *more* with addition of *more* X. X might broadly be called a "catalyst". The question is, is innovation faster with patents, or without patents? Are patents a catalyst? Since there is no way to experimentally test the "without patents" case, they have basically no idea if patents work as designed or not.

So yes, this will be ignored, and rightly so, because it doesn't say anything.

Oh, I'll accept that it confirms certain people's biases (e.g. 95% of the readership here), but that's not the same as saying anything.

Re:Watch... (0)

Anonymous Coward | about a year and a half ago | (#42809035)

Just to head off the obvious troll being obvious.. I messed up and did not use the proper version of "their." Soooo sorry.

You reponded with a sentence fragment and threw in a couple extra periods to boot.

Re:Watch... (0)

Anonymous Coward | about a year and a half ago | (#42808101)

As they should be, damn anarchists strike again. Probably vile liberals like the tons on this site.

Re:Watch... (4)

amiga3D (567632) | about a year and a half ago | (#42808391)

Actually I'm a strong conservative and I entirely agree with them. It's the simple truth and the patent system is destroying this country. I think it's so screwed it needs to be done away with and rewritten from scratch. There should be some protection for real inventions but this incremental, "we modified this so it now works this way" bullshit needs to go. Software patents need to be totally abolished. During the early days of software development before the patent nightmare we now endure there was rapid growth. Have an idea? Go for it! Now it's have an idea, call the lawyers.

Re:Watch... (0)

Anonymous Coward | about a year and a half ago | (#42809029)

It's super rare for me to encounter an actual Conservative these days. Could you have a word with the wingnuts on twitter who misleadingly call themselves Conservative and are destroying the brand? #TGDN #TCOT #REDNATIONRISING

They're very reality-resistant, and love being misled and fleeced by con-men like Rush Limbaugh, David Barton, and the Breitbrats, but maybe you can talk some of them down by approaching them as someone with something in common who wants to save Conservatism.

Oh Give Me a Break (4, Insightful)

eldavojohn (898314) | about a year and a half ago | (#42808257)

They're careers will be systematically destroyed.

This was published in September of 2012 [stlouisfed.org] by the St. Louis Fed, when can I expect to see their careers systematically destroyed? Does that take longer than five months to walk someone out of such a highly visible position? Even Richard Stallman cited this [slashdot.org] when he responded to one of my questions.

Not to mention what they say, even if perfect in its documentation and rationality, will just be ignored.

After reading much of the report, I don't think it is "perfect in its documentation and rationality." While it brings up great examples of serious problems with the US Patent System (like software patents, the poster child for all that is wrong with patents), it does not examine examples where the patent system has worked. It seems to pretend like patents have never done anyone any good ever. Nor does it discuss how we would have to revert to trade secrets and lying awake at night wondering if one of our employees had just brought a bunch of documents over to our competitor for an undisclosed sum -- which employee would you charge with corporate espionage? All that fun stuff is completely ignored so I would consider the report lacking in thoroughness. They also spend a lot of time discrediting studies that claimed patents are beneficial which is all well and good. It doesn't follow that patents are completely bad, however.

Economists that don't toe the corporate line of thinking get booted.

I don't think that's true. I think it's true that economists who attack corporations for the sake of attacking corporations get booted ... but that's just because they let personal biases get in the way of research. It's odd, Blodrin and Levine actually cite a bunch of cases where the big corporations got bit in the ass (like the Motorola, Samsung, Apple, etc cell phone patent fiascos). So, you know, I think that patent reform (and maybe abolition) is actually starting to look beneficial for many corporations that want to expand even further.

Re:Oh Give Me a Break (2)

tyrione (134248) | about a year and a half ago | (#42808455)

It's a couple of Supply Side Neo-con economists who were against Stimulus and Pro-Austerity talking about economic equilibrium as if Economies are in a fixed sphere with a fixed about of water that given enough release of pressure we level out and stabilize. Their applications are absurdly shallow and small in scale, which is ironic for two macroeconomic theorists. The best news is that the overwhelming majority of global economists think they're full of crap.

Re:Oh Give Me a Break (1)

Vaphell (1489021) | about a year and a half ago | (#42808891)

as if Economies are in a fixed sphere with a fixed about of water that given enough release of pressure we level out and stabilize

fixed no, but if you don't see for example outsourcing as a process of leveling out on a global scale then i don't know what to tell you. Trade is arbitrage and arbitrage is taking advantage of inequalities not unlike a watermill taking advantage of water flowing downwards or a lightbulb glowing because the electric current wants to level out the difference of electric potential
The overwhelming majority of global economists is occupied with redefining the units of currency (apparently hoping that people won't notice that money and actual purchasing power are not the same thing) and reducing complex problems to simple scalars like aggregate demand way too much.

Re:Oh Give Me a Break (1)

TheRealMindChild (743925) | about a year and a half ago | (#42808457)

Not to mention, you just opened a floodgate straight to hell in terms of crime. Each company would need to employ bigger sleazes and craftier spies than their competition to be able to stay on top. You start having corporate sponsored mobs

Re:Oh Give Me a Break (0)

Anonymous Coward | about a year and a half ago | (#42808929)

We already have that with patent lawyers.

Re:Oh Give Me a Break (0)

Anonymous Coward | about a year and a half ago | (#42808511)

Trade secrets? Ohh pish-posh. By the time a competitor can get the expertise to implement whatever was stolen from you, they'll already be behind.

Most modern tech is outdated in short order. The group doing the research will have a huge home-field advantage.

Just make a law stating that poaching/bribing other company's employees for trade secrets that encourages/causes said employees to break an NDA, is punishable.

You don't need patents to enforce these things. Just show probable cause of trade secrets being stolen and request discovery to audit the paper trail to see if the other company can prove that they created it themselves.

Re:Oh Give Me a Break (2)

steelfood (895457) | about a year and a half ago | (#42808735)

I've said it before, and I'll say it again: not having patents would confer significant, often insurmountable advantages to large corporations.

I do advocate patent reform, but outright doing away with it will be bad for all but a handful of people at the very top of the corporate ladder.

Furthering class warfare (5, Insightful)

fascismforthepeople (2805977) | about a year and a half ago | (#42808043)

The patent system, for as much as it gets bad press, offers the little guy (independent inventor) a chance to get ahead. With no patents, anyone with money can make a clone of an existing product and do whatever they want with it, including selling their clone as the original item. Such a patent-less system undoubtedly favors the wealthy who have access to the means to do such things.

And when you accelerate the acquisition of power, you encourage oppression in the name of profit. This leads directly to fascism for the people.

Re:Furthering class warfare (5, Insightful)

MickyTheIdiot (1032226) | about a year and a half ago | (#42808061)

This might be true in a society where the corporate elite can use the court system as a weapon.

Re:Furthering class warfare (5, Insightful)

h4rr4r (612664) | about a year and a half ago | (#42808075)

At one time it did that, now it does not.

Go pantent something as the little guy, they big boys will then patent every use of your thing they can think of or tie you up in court until you are bankrupt.

Re:Furthering class warfare (1)

LordLimecat (1103839) | about a year and a half ago | (#42808667)

Examples, please.

Re:Furthering class warfare (5, Interesting)

Maximum Prophet (716608) | about a year and a half ago | (#42808903)

Examples, please.

Philo T. Farnsworth. http://en.wikipedia.org/wiki/Philo_Farnsworth [wikipedia.org]

Basically invented television, then RCA under Sarnoff stole it. I don't think he ever went bankrupt, but his laboratory equipment was repossessed. All and all, he spent much more time in the courtroom than any inventor should.

Re:Furthering class warfare (1)

Anonymous Coward | about a year and a half ago | (#42808919)

The poster child story is this one: http://www.forbes.com/asap/2002/0624/044.html

They don't even need to go to court, just threaten to do so.

Re:Furthering class warfare (1)

Skinkie (815924) | about a year and a half ago | (#42808081)

Have you been looking at kickstarter? The independent investor does get support and funding now out in the open while in past times this didn't happen. Whats wrong with a bit of competition? If someone really could make a clone of a product at a tenth of the price, everyone benefits including the original inventor that could copy the production strategy.

Re:Furthering class warfare (1)

fascismforthepeople (2805977) | about a year and a half ago | (#42808133)

If someone really could make a clone of a product at a tenth of the price, everyone benefits including the original inventor that could copy the production strategy.

No. Most often the inventor does not benefit, as the clone is often of inferior quality. This leaves the inventor looking like someone who made a shitty product and the demand erodes to the point where the inventor's name is no longer good for anything. And being as the production strategy usually entails sending production to a country where people can be paid less than a dollar a day, knowing the new strategy is of no value to a small inventor.

Re:Furthering class warfare (2)

Skinkie (815924) | about a year and a half ago | (#42808385)

Patents are not brands. So the original brandname is still protected.

Re:Furthering class warfare (1)

fascismforthepeople (2805977) | about a year and a half ago | (#42808613)

Patents are not brands. So the original brandname is still protected.

Only to a certain extent. If you make the JoeCo Frobulator 1 with no patent, someone else could make a cheap clone called the Frobulator 1 and make it look the same without issue. Likely they could get away with even calling it the JoeCo Frobulator 1 for some time as well before anyone would take action against them. If you have registered a company name of JoeCo they might only need to manufacture it somewhere else and put a label saying JoeCo on it and they'll be able to get around that issue as well.

Re:Furthering class warfare (1)

Marxdot (2699183) | about a year and a half ago | (#42808137)

No, patent systems are dominated by large businesses patent-trolling. Independent inventors (or just people who would very fairly like to use certain algorithms, in the case of software patents) get trampled upon 9,999 instances out of 10,000.

Re:Furthering class warfare (1, Insightful)

Joce640k (829181) | about a year and a half ago | (#42808285)

The patent system, for as much as it gets bad press, offers the little guy (independent inventor) a chance to get ahead. With no patents, anyone with money can make a clone of an existing product and do whatever they want with it, including selling their clone as the original item.

That's the theory, yes.

The practice is that the wealthy just use the patent system as a weapon against small guys to achieve the exact same thing.

Re:Furthering class warfare (2)

Merk42 (1906718) | about a year and a half ago | (#42808487)

So the patent system should be fixed to bring it back to that theory, not removed because of abusive practices.

Re:Furthering class warfare (1)

tepples (727027) | about a year and a half ago | (#42809053)

Perhaps the argument is that the lack of a patent system is better than the present abusive patent system, and until the patent system can be fixed, abolishing the patent system is an improvement.

Re:Furthering class warfare (1)

nedlohs (1335013) | about a year and a half ago | (#42809063)

Sure that's another option. A much harder option since working out the details of a new system isn't trivial. An option that would take much longer.

Why not remove it and then work on adding back a fixed version. That way you get the quick fix now, and you can still have the better fix later. You also get to observe the effects of not having the system at all which will be of great benefit when designing a new system.

Re:Furthering class warfare (1)

Red Flayer (890720) | about a year and a half ago | (#42808565)

Such a patent-less system undoubtedly favors the wealthy who have access to the means to do such things.

From the perspective of many economists, this is not a problem for the overall economy. I've noticed that they tend to view consolidation as a good thing, as there are increased efficiencies due to economies of scale, etc -- i.e., better to have a big company with massive capital roll out an invention quickly and effectively than to waste capital and labor on a start-up doing the same thing and making tons of mistakes along the way, etc.

Re:Furthering class warfare (0)

Anonymous Coward | about a year and a half ago | (#42808997)

As the paper points out, anyone can think of a reasonable patent, but on balance the system does not work. To rationalize something based on only best case scenarios is an extremely common fallacy in public policy circles.

Fix Patents (4, Insightful)

Pete (big-pete) (253496) | about a year and a half ago | (#42808063)

I have my own ideas about patents, I think there should be categories, rather than all patents being valid for the same term.

Patent duration should be related to the amount of R&D needed to develop and turn into a meaningful product, so if we absolutely have to have software patents, then they should have a duration of 1 or maybe 2 years - but a pharmacutical patent with a long development process and high costs can have the full existing term.

This would maintain the purpose of patents to allow the "inventor" to control their product within a reasonable time, but it would not stifle innovation where other new developments are trapped by a massive maze of existing patents in a fast moving field.

-- Pete.

Re:Fix Patents (1)

Bigby (659157) | about a year and a half ago | (#42808139)

The purpose of the Patent is to allow the inventor make a profit without competition. Or to charge the competition for the right to compete. It doesn't have to do with research...directly.

I think the Patent term should relate to the expected depreciation of such idea. For instance, in software, most ideas are old ideas in 1 or 2 years. The Patent term could be 6 months. But in breakthrough algorithms, it could be a 5 year patent. For pharmaceutical evolution, it could be 6 months. But for breakthroughs (cure for cancer?) it could be 10 years.

Re:Fix Patents (0)

Anonymous Coward | about a year and a half ago | (#42808591)

The purpose of the Patent is to allow the inventor make a profit without competition.

Absolutely wrong. The purpose of patents is to convince inventors to share their discoveries by offerring a temporary monopoly of such technology. Before patents, there were only trade secrets, and there were a lot of them. Technology was stagnant because when soemone discoverred a competative advantage, they (and their apprentices) put more effort into keeping it a secret than looking for a way to improve it more.

Design patents, software patents, yeah, those are useless. However, do not kill the entire patent system just because it has a tumor on the side. Cut off the tumor and try to minimize the damage to healthy areas.

Re:Fix Patents (0)

Anonymous Coward | about a year and a half ago | (#42808529)

...but a pharmaceutical patent with a long development process and high costs can have the full existing term.

I've thought for a long time that pharmaceutical patents should be in a category all their own, but not the way you're thinking. The problem with letting companies patent drugs is that the demand for many kinds of drugs is inelastic, so the number of people able to afford the drug is in inversely proportional to the inventor's profit margin. That's directly contributes to the United States' spiraling national health care costs and produces human suffering and misery.

Accordingly, the length of a pharmaceutical patent should be set not to a fixed term, but rather should expire once the inventor has recouped their R&D costs and some fixed amount of profit (maybe R&D costs + (R&D costs * 10%)). Once they've recouped their costs plus a set profit margin, the patent immediately expires and anyone can make the drug, thereby driving down the prices and expanding availability. If they set the profit margin high, they recoup their costs faster so the patent expires faster, making the formula publicly available more quickly. If they reduce the profit margin, they recoup their costs more slowly and the patent lasts longer, but the drug is cheaper from the outset and becomes more affordable. Either way would reduce health care costs and expand drug accessibility over the long term.

Yes, this would create a motive for pharmaceutical companies to lie about their R&D costs, but there are ways to verify those and we could then prosecute violators for fraud. Right now, we can't prosecute them for making excessive profit at the expense of suffering people.

Hollywood accounting (1)

tepples (727027) | about a year and a half ago | (#42809093)

Accordingly, the length of a pharmaceutical patent should be set not to a fixed term, but rather should expire once the inventor has recouped their R&D costs and some fixed amount of profit (maybe R&D costs + (R&D costs * 10%)).

Most compounds that begin investigation fail to be approved as drugs. Which failed compounds will a pharmaceutical company be able to charge against a given drug's R&D costs? When you start tying things to profit amounts, you'll see "Hollywood accounting" as companies perform various tricks to limit the paper profit.

Re:Fix Patents (2)

dkleinsc (563838) | about a year and a half ago | (#42808563)

Here's part of the problem with that proposal: What about inventions that include multiple kinds of components? For example, if you have a software modification to a medical device that makes it more accurately detect and respond to changes in the patient's body, is that a medical device invention, or a software invention?

Free Market (1)

Bigby (659157) | about a year and a half ago | (#42808083)

The US Patent system is a deviation from the free market. It is really one a few things mentioned in the US Constitution that deal with the market. One of the others, and much bigger, is taxation.

So it is no surprise that some/many Economists would disagree with Patents. Those same people probably don't disagree with the copyright system. Patents are government enforced monopolies and copyrights are property...that can be replicated at no (very very little) cost.

I say get rid of Patents. If you have a great idea, obfuscate it as best you can and bring the product or service to market.

Re:Free Market (1)

paulpach (798828) | about a year and a half ago | (#42808201)

So it is no surprise that some/many Economists would disagree with Patents. Those same people probably don't disagree with the copyright system. Patents are government enforced monopolies and copyrights are property...that can be replicated at no (very very little) cost.

I agree 100% with your position in patents. However, these Economists are from the federal reserve. A private entity that has been granted a monopoly by government to print money, lend it in secret at whatever rate they want and unilaterally decide how much people should charge for lending money (interest rates). The FED and these economists are the antithesis of free market.

Re:Free Market (1)

Bigby (659157) | about a year and a half ago | (#42808293)

Very true. In a way, they have a perpetual Patent on money. A competing currency would resolve that issue. I think there are some within the Federal Reserve that probably side with a competing currency idea. However, they are in the extreme minority. Most people don't go against the principles behind why they have a job.

Re:Free Market (0)

Anonymous Coward | about a year and a half ago | (#42808271)

How are copyrights not government enforced monopolies?

Sheer rubbish. (1)

Anonymous Coward | about a year and a half ago | (#42808117)

The patent system promotes innovation. Who is going to invest years of money and time to develope new technologies if they are going to be copied by everyone else without remuneration? I would not have spent thousands of dollars and hundreds if not thousands of hours (I stopped counting years ago) designing, testing, prototyping and promoting my invention. Obviously these intellectual morons sitting in their achademic ivory towers should get off their asses and do it themselves.

Re:Sheer rubbish. (0)

Anonymous Coward | about a year and a half ago | (#42808239)

So you have a patent. Then all the big players come along and copy it without remuneration to yourself.
What're you going to do about it, mister one-patent? Hope you've got some hefty profit margin there, to pay the license fee for every spurious patent levelled against you.

A bit old? (0)

Anonymous Coward | about a year and a half ago | (#42808171)

Wasn't this already posted on slashdot several months ago?

It just needs to have better standards (0)

Anonymous Coward | about a year and a half ago | (#42808193)

1. You have to create what you patent; You can't patent an obvious idea knowing it will be created in the future so you can patent troll.

2. You can't patent generalized ideas.

3. There needs to be better checks and balances on what gets approved, I feel people are getting paid off.

duplicate? (1)

novium (1680776) | about a year and a half ago | (#42808197)

Didn't this get posted last fall? (Maybe last summer)?

go back to the roots (0)

Anonymous Coward | about a year and a half ago | (#42808273)

The root of the patent system is to provide a *limited* term of protection in return for making the idea public and advancing the "art". I still hold that its a good idea; politician and big money have broken the implementation. The barrier for non-obviousness has been a joke for a while -- the vast majority of software patents are obvious to someone "practiced in the art".

Patents aren't all bad (1)

stonelikearock (1217706) | about a year and a half ago | (#42808315)

While I agree that the current practice of IP landscaping does sometimes have the effect of stifling innovation I don't believe that the patent system should be completely abolished, just changed. The act of rewarding the first person to come up with something new encourages people to innovate, but patent applicants should be required to demonstrate how they would implement the idea described in the patent to prevent people from patenting concepts that they hadn't fleshed out. For example, GE shouldn't be able to patent the idea of building a wind turbine with a certain type of blade if they haven't already demonstrated a design that works.

The really simple, immediate fix (-1)

Anonymous Coward | about a year and a half ago | (#42808325)

Raise the filing fee for patents to a million dollars and let the market decide what's worth protecting. If you want to spend a billion dollars testing a new pharmaceutical and then have a (well-deserved) monopoly for twenty years, a million bucks is a drop in the bucket. But IBM is going to file twenty patents a year, all on actually novel, profitable ideas, instead of the four thousand they currently do (which is mostly to extract future licensing fees). Cell phone makers might file half a dozen a year instead of the thousands they create. Patent trolls mostly (if not entirely) go away, and most patent lawsuits do too.

The downside is that lone inventors would no longer be able to patent their innovations. The upside of all industries escaping the "patent tax" outweighs that though.

In other news... (1)

alexo (9335) | about a year and a half ago | (#42808347)

Cows argue that McDonald's should be abolished.

Two economists in agreement? (0)

Anonymous Coward | about a year and a half ago | (#42808351)

We should probably listen to them, I don't think this has ever happened before.

What About Copyrights? (1)

Rob Riggs (6418) | about a year and a half ago | (#42808365)

Now do the same analysis on copyright and the public domain. Trillions dollars of our public wealth has been sequestered by the corporate oligarchy. And they paid fractional cents on the dollar in "campaign donations". I'm fine with it if we tax the hell out of anything that doesn't go into the public domain after 17 years. You want to keep Mickey Mouse out of the public domain? Sure, just pay $1,000,000 the first year, doubled every year after that, and adjust the starting and ongoing amounts for inflation. At least we, the people, get something in return.

Re:What About Copyrights? (1)

tyrione (134248) | about a year and a half ago | (#42808473)

Create something worth copyrighting. Then bitch about it being too long under your legal protection. Just Do It.

Re:What About Copyrights? (1)

Rob Riggs (6418) | about a year and a half ago | (#42808867)

Software? PCB designs? Documentation? Photographs? Technical articles? Done. Now what, smart-ass?

Possible fixes (1)

Anonymous Coward | about a year and a half ago | (#42808377)

Unfortunately, nothing is likely to change. The interests of those with money will outweight reform.

The system isn't impossible to fix, but it can't be fixed without annoying current patent holders.

- Make patents non-transferable. (no more patent trolls)
- Patents can only be owned by one (or more) people. (so that companies can't be used as containers)
- Patents have a maximum lifetime that cannot be extended. (You want to keep earning from your idea? Improve on it!)
- No frivolous patents (ie. slide-to-lock and their ilk, patenting a rounded rectangle as shape for a mobile device is just silly)

I'd add 'software patents' to it. But that would probably open another can of worms.

In other news... (1)

nflenz (2426556) | about a year and a half ago | (#42808393)

More than two economists argue the opposite.

Wait! (1)

snemiro (1775092) | about a year and a half ago | (#42808429)

I thought the idea of the tax and patent system was only an extra revenue for bankers, lawyers and accountants... who planned the system.... like the Government - Fed eternal debt... On the other hand, I think patents should be owned by people, non-transferable, and for a limit period of time (10 years?), not companies, simply because a person (or a team) developed the device/solution. And of course, the process to register it should be FREE. If you as a John Doe develop something new, it's obscene to pay $20.000 to protect it... And "ideas" shouldn't be allowed to be patented....maybe another method....but "system where the user ask for something through a device to get a result"..... Companies will not be able to avoid taxes using the "IP fee" to subsidiaries in fiscal paradises anymore....there is so much money involved, I don't think this abolition would prosper...

No Patents means higher quality goods (0)

Anonymous Coward | about a year and a half ago | (#42808497)

With no patent protection, the people who make the junk we are forced to buy will hold off on shipping until they have 'perfected' their product, giving them a leap of a year, if not more ahead of copycats.

So instead of shipping alpha quality crap, there would be fewer products, and those products would be better made.

That's in addition to all the other reasons to dump patents.

Begin the Countdown (1)

bistromath007 (1253428) | about a year and a half ago | (#42808531)

Somebody in the real (i.e., appointed) government has said something that large corporations will not like.

I give it three days before they're fired.

Bumped your head if. (0)

Anonymous Coward | about a year and a half ago | (#42808543)

You think you can just get the rich to let go.
Fundamentally you always have to drag them kicking and screaming to the money.

FailZors (-1)

Anonymous Coward | about a year and a half ago | (#42808557)

Demise. You 3on't intentions and to the 0riginal

Example (1)

Anonymous Coward | about a year and a half ago | (#42808589)

The original IBM PC and Apple computers.

IBM let anyone and everyone make computers using their architecture with few restrictions, but initially IBMs were The BEST so they thrived.
Those who could bought IBM PCs, those who couldn't afford it bought a cheaper clone and wished they had an IBM.

This is a very large part of why computers are so commonplace and such a huge part of modern life.

Apple used a different architecture and refused to allow others to use their architecture.
They WERE good, but much more limited in a short period of time due to relatively small market share within a few years.

Now this example is not a direct corelation, I admit but consider if IBM had done the same thing Apple did- computers would likely be a hugely expensive item that only a few people could afford.
Instead we had a market full of mostly compatible devices that could inter-operate pretty well.
And these devices improved RAPIDLY due to the number of companies trying to make their product better.

Patents are, for the most part, a way of preventing compatibility and ensuring high cost and bad value for end-users.
People WILL pay more for similar devices when one is appreciably better in some way-
A Ford Focus is a pretty good car at its price, yet many people still buy Mercedes that cost far more even though they DO example the same thing: fairly basic transportation.
And they are both automobiles with four rubber-tired wheels, a windshield and other similarities.
The modern US patent system would allow someone to patent an automobile with four rubber tires and so on preventing any OTHER company from selling one.

Big companies use patents in BOTH ways- they will try to copy someones else's successful device while preventing anyone from copying theirs.
Patents need a huge amount of reform and basically 99% of patents should be invalid.
Getting rid of patents entirely would do far less damage than keeping the system that is in place now does.

Re:Example (1)

cpt kangarooski (3773) | about a year and a half ago | (#42808851)

That's not what happened.

Neither Apple nor IBM liked it when people made clones or compatible systems. But other than being able to go after people who directly copied their software (eg shady manufacturers who made direct copies of the ROM, such as Franklin, which got sued for copying Apple's) not much could be done about it.

Apple's later systems had a more complex ROM that was more important, and combined with changes in the marketplace, generally stopped having this problem. (Showing that piracy is better than unpopularity) But there were still Mac compatible systems, like the Outbound laptops that predated the PowerBooks, and required a user to install his own ROM, scavenged from a proper Mac.

IBM tried to get away from the original PC architecture with the PC Jr. but everyone hated it, and their simple ROM was soon reverse engineered, which gave the third party hangers on a way to make perfectly compatible systems legally, which pissed IBM off to no end. And it was popular. And now IBM doesn't even make personal computers anymore.

Abolishment is stupid (1)

Culture20 (968837) | about a year and a half ago | (#42808681)

Well I for one welcome back the days of secret crafts passed down in guilds and enforced with thuggery. Forget patent reform; down with patents!

Apple is in full agreement (1)

erroneus (253617) | about a year and a half ago | (#42808691)

Apple is in full agreement with this except where they are concerned. So they are asking for exemptions which enable them to continue to leverage rounded rectangular patents and trade dress against everyone else.

I say this largely because Apple has said as much in its legal filings you can read over at Groklaw. It's rather ridiculous to read how they feel patents which represent actual R&D and inventions of original technology should not be eligible for protection while their software based stuff should be protected.

Explore All Extremes (1)

organgtool (966989) | about a year and a half ago | (#42808699)

Like many people on this site, I feel that patents are granted far too easily for "inventions" that are hardly original or novel, but I feel that getting rid of the system entirely would be throwing the baby out with the bath water. However, if we are ever going to fix the patent system, we need to explore all extremes. Right now, we are living under a system of extremely heavy patent protection. This system has been so indoctrinated into most of the population that the suggestion to reduce patent protection usually gets reactions of horror as if you are perpetrating a plot to bring down the entire economy. Therefore, articles like this lend credence to the idea that our economy would be fine without patents and then we can attempt to find a balanced solution.

I'll admit that I have thought about the implications of removing the patent system completely and I believe it would certainly change the economy, but it wouldn't completely upend it. If patents didn't exist, people would rampantly copy each other's ideas. With so much copying going on, they would eventually be forced to differentiate their products from other copies. Therefore, they would create many small innovations to distinguish themselves from the other clones and innovation on the smaller scale would increase. Conversely, since inventions could be freely copied, there would be less incentive for people to put research into costly large-scale research projects. The goal to maximize incentive is to continue protecting the large-scale projects while providing minimal, if any, protection to minor inventions. I think we can all agree that the current system has reached the point of absurdity where even the most trivial concepts are protected and we need to start scaling back to find that sweet spot in the middle.

Ch-ch-changes (3, Interesting)

Dachannien (617929) | about a year and a half ago | (#42808781)

Incremental changes might be a better idea. Two such changes, for starters:

Loser Pays. In Europe, when a patentee files an infringement lawsuit and loses, they are liable for the defendant's court costs and attorney's fees. In the US, unless the suit was frivolous (and this is a high bar to meet), each party pays its own costs.

Compulsory Licensing. Consumers lose when a patentee uses patents to exclude other innovation from the marketplace. Rather than allowing a patentee to exclude others from producing an infringing product, allow infringers to continue paying a reasonable licensing fee. Essentially FRAND, but covering all patents.

FRAND (1)

Dr Modesto (1004773) | about a year and a half ago | (#42808785)

I'd like to see all patents be FRAND by default. In addition I'd like to see that include binding arbitration on disputes which can cap the total royalty and duration. I just can't see why a software patent that came out of a 10 minute brainstorming session should have the same rights as something that took a team years of experimentation to discover.

Reform would be better (1)

Pigeon451 (958201) | about a year and a half ago | (#42808945)

Patent applications are abused right now. There's too many vague patents out there, and many have prior art. The time to invalidate a patent, and cost of litigation just makes patent law ridiculous.

Patent applications should be screened much more thoroughly, but of course, this just means that it would take longer and be more expensive. Something needs to be done, but abolishing patents is not the way to do it.

I don't agree for the most part. (1)

TheSkepticalOptimist (898384) | about a year and a half ago | (#42808981)

The current interpretation of a patent is one where a company leverages an innovation against their competition, either by blocking the competition from creating innovations that use or build off of, or are in some way competitive to, the said invention, or to extort obscene profits in royalties and licensing to competitors that have no choice but to use the innovation.

The reality is that patents are public disclosure of an idea which was intended to STIMULATE innovation by sharing ideas and having others build off the original idea.

Patents were explained to me once, but an actual lawyer, in this way:

Company A builds a chair with 3 legs. It works well but under some instances the chair could fall over. Sales of the chair are low because consumers find it lacking in overall functionality and safety.

Company B sees the original 3 leg chair patent and decide they can improve upon it by adding a 4th leg. Doing so improves the functionality of the original concept. Company B enters a cross licensing/royalty relationship where both companies can now sell chairs with 4 legs. The original Company A now has stronger sales (and higher profits) and Company B can now sell an improved concept from the expansion of the original idea. The idea is that by Company A originally disclosing the innovation of a chair with 3 legs allows the idea to be improved upon and the original inventor enjoying greater success off of the work another inventor did to improve the idea. Both companies benefit, consumers benefit, society is advanced.

In today's market, Apple would have invented a 2 leg chair, told consumers that any company that uses more then 2 legs on a chair are stupid, sued anybody that tried to make a better chair, and in the end Google creates a chair on top of a ball and Microsoft creates a table that could be used like a chair...or bed.

I don't agree that patents themselves are at fault here, only in how greedy self-interested corporations are using patents to shut out competition. Arrogant companies like Apple seem to feel they are the only innovators in an industry and thus do not want other companies to use or build on their ideas (even though Apple seems to consistently patent other peoples original ideas and claim it their own). Apple has created an aggressive market where competitors are hording patents and using them as weapons against each other. Apple is not going to cross license with Google, and vice versa, so both platforms evolve independent of each other and so, ultimately, to the detriment of consumers that can't get the best of all innovations in one package.

I do agree, however, that software patents should be abolished completely. It is trivial to create a software meme that can be easily reproduced by another independent entities. I have always felt that patents should only be awarded to non-trivial invention. If an invention involves significant investment in time and money or leaps in technical advancement to achieve then the patent should be awarded, and thus, disclosed so it can advance innovation and invention by allowing other companies to build off the idea without the initial huge investment in time and effort.

Rounding the corners on rectangles is a trivial non-invention, it should never even have been considered for patent application.

I think patent laws need to change, but patents themselves should not be abolished. Someone that invests time, money, and significant effort to invent something deserves some protection from unscrupulous others who will only copy the idea and profit off of it. But the current trend to patent "everything" including highly trivial junk should be discouraged.

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