Author(s)
Source
Journal of Economic Literature, 2007
Summary
This paper reviews two careful studies of how copyright and patents help creators.
Policy Relevance
Intellectual property can help economic growth. The U.S. system seems to work well. Fears of patents are somewhat overblown, and can be addressed.
Main Points
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Khan’s study of the United States in the 19th century shows that IP helped growth. The U.S. system did well, compared to Europe, in helping those of any class innovate.
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Khan claims that the failure of U.S. copyright law to protect foreign authors like Charles Dickens made sense. But her data shows that many more authors entered U.S. markets when international copyright was expected pre-1891.
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Some argue that piracy helps authors, by increasing demand for services such as lectures. If this were correct, early authors would have opted out of copyright, giving books away for free to lecture. None did, suggesting the benefits of piracy, if any, are tiny.
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Blind’s study of software patents is based on surveys of European software firms in 2001. The firms generally wanted no changes in European law.
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In the United States, software can be patented by itself. In Europe, software must be tied to hardware to gain protection.
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Some predicted that U.S. software patents would harm the software sector. Years later, there is no evidence of harm. Fears are likely overblown in Europe, too.
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Mature European firms and those with experience of patents outside of software tended to fear patents less. A few found patents useful in negotiating with others.
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Improving patent quality and concerns about how to build products that work with other products (“interoperability”) will ease fears of software patents in Europe.
* Full title: Now and Then, Here and There: A Review Essay on Khan, The Democratization of Invention, and Blind, et al., Software Patents