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Optimal Patent Protection: A Macroeconomic Perspective

Author

Listed:
  • Meng Samuel

    () (University of New England, Armidale, New South Wales 2351, Australia)

Abstract

The need to balance the positive and negative effects of patent monopoly is at the heart of design and reform of the patent system. However, by scrutinizing prior studies on optimal patent design, this paper has found that the basis for this balanced approach is flawed. Furthermore, a macroeconomic analysis of the patent system confirms that there is no trade-off in patent protection, unless the patent system generates only marginal negative effects. The implication of this finding is that a new patent system design is needed to stimulate innovation directly while minimizing deadweight loss.

Suggested Citation

  • Meng Samuel, 2017. "Optimal Patent Protection: A Macroeconomic Perspective," Asian Journal of Law and Economics, De Gruyter, vol. 8(2), pages 1-16, August.
  • Handle: RePEc:bpj:ajlecn:v:8:y:2016:i:2:p:16:n:3
    as

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    References listed on IDEAS

    as
    1. Paul Klemperer, 1990. "How Broad Should the Scope of Patent Protection Be?," RAND Journal of Economics, The RAND Corporation, vol. 21(1), pages 113-130, Spring.
    2. Suzanne Scotchmer, 1996. "Protecting Early Innovators: Should Second-Generation Products Be Patentable?," RAND Journal of Economics, The RAND Corporation, vol. 27(2), pages 322-331, Summer.
    3. Edwin Mansfield, 1986. "Patents and Innovation: An Empirical Study," Management Science, INFORMS, vol. 32(2), pages 173-181, February.
    4. Tandon, Pankaj, 1982. "Optimal Patents with Compulsory Licensing," Journal of Political Economy, University of Chicago Press, vol. 90(3), pages 470-486, June.
    5. Nordhaus, William D, 1972. "The Optimum Life on a Patent: Reply," American Economic Review, American Economic Association, vol. 62(3), pages 428-431, June.
    6. Suzanne Scotchmer, 1991. "Standing on the Shoulders of Giants: Cumulative Research and the Patent Law," Journal of Economic Perspectives, American Economic Association, vol. 5(1), pages 29-41, Winter.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    deadweight loss; optimal patent design; patent monopoly; social benefit;

    JEL classification:

    • K11 - Law and Economics - - Basic Areas of Law - - - Property Law
    • K12 - Law and Economics - - Basic Areas of Law - - - Contract Law
    • K23 - Law and Economics - - Regulation and Business Law - - - Regulated Industries and Administrative Law

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