How patents prevent rather than promote adoption of new technologies
Michel Bauwens of the P2P Foundation recently excerpted an article that argues patents might not be the clear-cut technology promotion tool they are hyped up to be. The article itself, by Boldrin, Levine and Nuvolari makes the case that improvements in steam engine technology during the time between 1772 and 1852 show that the protection afforded by patents is not associated with vigorous technological development. Their article is titled
and it was published in The Freeman.
Image is of "the green steam engine" found on PESWiki
Excerpting from Boldrin's introduction into the patent controversy:
"Today one of the most controversial issues in economic policy is that of patent law. Is a patent just an extension of property rights to the realm of ideas? Or is it an unwarranted interference by the government into the rights of individuals who have purchased goods and services to use them as they see fit? Should the Western system of patents be extended worldwide? Or should we get rid of patents entirely? Is the patent system responsible for modern miracle drugs? Or is it to blame for the millions dying of HIV in Africa? Do patents lead to greater innovation and economic growth? Or do they kill the goose that lays the golden egg?"
"The issue of whether patents are genuine property rights or unwarranted government interference cannot of course easily be answered by a natural experiment. We will leave that discussion to philosophers. The impact of patents on innovation does have an objective answer. In this case history instead of nature has been kind enough to provide us with a wonderful natural experiment. This experiment took place in the county of Cornwall, England, between 1772 and 1852. It was there, in the extreme southwest of England, in the wet depths of the Cornish copper and tin mines, far removed from the supply of coal in Wales, that the steam engine was pioneered."
I recommend reading the full article and, if you're interested, also the comments which give a diversity of views.
Some of you may know that I have written on the subject of patents a good 20 years ago. The article is available on my 'historical' site www.hasslberger.com and is the first one in the Technology and Patents category. In introducing The Inventor and Society, I wrote "Patents are, at times, a block to technological progress, acting to discourage inventors who have found ways to circumvent the dearly held "natural laws" of thermodynamics and of conservation of energy. Why not use a different system that ensures protection of the inventor but does not require him to provide a theory for his invention to register it."
- - -
That view on patents is confirmed by the article of Boldrin, Levine and Nuvolari. They are criticized in some of the comments for being not very accurate in their analysis, so I was prompted to add my two cents, and what I think is more evidence that they are in fact correct. Here is the comment I posted:
"Some commenters criticize the authors of this article for assumptions they say are incorrect. I would like to support them for having the courage to examine and criticize a system that has been established to protect economic interests, but that has never been proven to actually do much more than make a few people fabulously rich at the expense of everyone else and - at times - at the expense of technological progress.
Why is it that the disc break, invented by Italian engineer Giovanni Dotto, although vastly superior to the drum break design in use in all early cars, was not adopted by the major car and truck manufacturers, until Dotto's patent had expired and the innovative design was no longer protected? Did patenting the disc break protect Dotto's interests? No, it didn't. Did patenting the disc break promote early adoption and use of an innovative design that vastly improved driving safety? No, it didn't.
Another, more current example: A man named Theodore Litovitz discovered that by adding low-frequency electronic "white noise" over the top of a cell phone signal, most of the biological effects of the radiation that were known at the time could be reversed.
Litovitz wrote several convincing papers on this subject and patented his work, but it does not seem to have been taken up by the cell phone industry. Instead, that same industry does everything it can to deny and bury any evidence that there ARE biological effects of pulsed microwave radiation and that their products are a ticking time-bomb for the health of users. Tumor incidence has a nasty habit of appearing with a long delay, years or even decades after continuos exposure.
Has patenting the solution to the problem of biological effects of pulsed microwave radiation by Litoviz served his economic interest? No, it hasn't. Has the patent led to the adoption of a life-saving technological hack that would make cell phones and other wireless apparatus safer for users and non users? No, it hasn't. On the contrary, one might argue it has induced the industry to try and avoid the additional cost of licensing, and to bend science in the process, to the detriment of many people's health.
I have brought up the question of patents in 1989 in an article titled "The Inventor and Society"
and have argued that, on balance, patents have done more harm to technological progress than they have helped. Innovation does not depend on the inventor being compensated with huge sums and a long term monopoly. It depends on human creativity and a spirit of competition.
There is no question in my mind that patents (and copyright) should be abolished or at least severely limited.
One change that would make sense could be a "fair compensation" provision that allows the originator of an idea the right to a reward, without hindering others from adopting the idea or allowing them to monopolize it in their turn. An agreed percentage of the income from sales to the inventor/creator, collected without a huge bureaucracy intervening (as is the case today with copyright) would be sufficient incentive, without stifling adoption."
I would really like to see this conversation taking place. The question we should ask ourselves is:
"How can the laws of intellectual property be amended to actually promote the interests of society as a whole, rather than the narrow economic interests of people and - increasingly - corporations who are able to smartly, and with a bit of good luck and cold calculation, use the patent (or copyright) laws to stifle competition?"
Are there ways to protect and reward creativity without putting roadblocks in the way of technological development?
A related article just out in Wired Magazine:
Take Heed, Tech Giants: Edison's Failed Plot To Hijack Hollywood
Edison assembled representatives of the nation's biggest movie companies--Biograph, Vitagraph, American Mutoscope, and seven others--and invited them to sign a monopolistic peace treaty. Since 1891, when the Wizard of Menlo Park filed his first patent on a motion picture camera/film system, his lawyers had launched 23 aggressive infringement suits against other production outfits.
Sometimes Edison won. Sometimes he lost. But the costs of these battles overwhelmed his rivals, and that was the intent.
"The expense of these suits would have financially ruined any inventor who did not have the large resources of Edison," one of his lawyers boasted, "and it could hardly be expected that he would be able to prosecute simultaneously every infringement as it arose."
Had Edison succeeded in litigating all of his competitors out of the business he would have killed the motion picture industry, or at least delayed its flowering by a generation...
And not only patents ... copyright seems to have the same drawback of keeping knowledge from flowing freely:
The constraining role of IP and Patents (2): case study on why Germany overtook England in the 19th century
Until now, copyright was seen as a great achievement and a guarantee for a flourishing book market. Authors are only motivated to write, runs the conventional belief, if they know their rights will be protected.
Yet a historical comparison, at least, reaches a different conclusion. Publishers in England exploited their monopoly shamelessly. New discoveries were generally published in limited editions of at most 750 copies and sold at a price that often exceeded the weekly salary of an educated worker.
London's most prominent publishers made very good money with this system, some driving around the city in gilt carriages. Their customers were the wealthy and the nobility, and their books regarded as pure luxury goods. In the few libraries that did exist, the valuable volumes were chained to the shelves to protect them from potential thieves.
In Germany during the same period, publishers had plagiarizers -- who could reprint each new publication and sell it cheaply without fear of punishment -- breathing down their necks. Successful publishers were the ones who took a sophisticated approach in reaction to these copycats and devised a form of publication still common today, issuing fancy editions for their wealthy customers and low-priced paperbacks for the masses.