Patent Buyouts: A Mechanism for Encouraging Innovation
AbstractIn 1839 the French government purchased the Daguerreotype patent and placed it in the public domain. Such patent buyouts could potentially eliminate the monopoly price distortions and incentives for rent-stealing duplicative research created by patents, while increasing incentives for original research. Governments could offer to purchase patents at their estimated private value, as determined in an auction, times a markup equal to the typical ratio of inventions' social and private value. Most patents purchased would be placed in the public domain, but to induce bidders to reveal their valuations, a few would be sold to the highest bidder.
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Bibliographic InfoPaper provided by Harvard University Department of Economics in its series Scholarly Articles with number 3693705.
Date of creation: 1998
Date of revision:
Publication status: Published in Quarterly Journal of Economics -Cambridge Massachusetts-
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