Re: Do patents really foster innovation?

From: Rafal Smigrodzki (rafal@smigrodzki.org)
Date: Fri Mar 07 2003 - 22:14:44 MST

  • Next message: Hal Finney: "Re: Do patents really foster innovation?"

    ----- Original Message -----
    From: "Hal Finney" <hal@finney.org>

    > In any case I still hope that Palladium and similar technology experiments
    > proceed and are allowed to compete in the marketplace with a wide variety
    > of other approaches to handling intellectual property. It would certainly
    > be preferable philosophically to find a way to encourage innovation and
    > creativity without having the heavy hand of government forcing people
    > to honor contracts to which they had not agreed, as is effectively the
    > case with current patent and copyright laws.

    ### This is a very interesting line of thought that I have been recently
    coming closer to. If the producer of a piece of information (be it music or
    knowledge embodied in a physical object) was really able to protect his
    property while allowing wide access to it, but without having a
    state-enforced monopoly, this might be actually better than the current
    situation. Persons unwilling to accept the terms set out by the owner would
    be free to compete by coming up with comparable information on their own,
    which would provide incentives to produce useful information, identical to
    the incentives in the production of other commodities. Still, not knowing
    enough about technology, I wonder if it would be really possible to protect
    information ownership rights without some significant restrictions on the
    devices used for the transmission and reading of information. How does
    Palladium work?

    I fully agree with the initial part of your analysis, since an appropriately
    managed patent and copyright system IMO indeed reduces transaction costs and
    allows the provision of useful goods which would otherwise not be provided.
    The existence of the legal infrastructure of courts (whether private or
    state run), capable of enforcing impartial decisions regarding private
    contracts at will, is a prerequisite for a lot of business activity, such as
    large banks, and other organizations too complex to rely exclusively on
    informal methods of resolving disputes. Copyright law is a type of useful
    infrastructure, and the question is not whether it works (because it does,
    sort of), but whether better solutions can be found.

    This said, current US copyright law, essentially a perpetuity, is a total
    mess, which frequently happens with systems amenable to political
    manipulation against rational market forces.

    Rafal



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