Michele Boldrin and David Levine , two well-known economists, argue that patents and copyrights aren’t needed for economic innovation. At first glance, the thesis sounds odd. If inventors can profit by getting a patent, won’t that encourage people to innovate? Boldrin and Levine don’t deny this, but they show that this isn’t the full story. Even if an inventor benefits from a patent, his monopoly position restricts the ability of other inventors to modify and improve his product. They illustrate their claim through a discussion of James Watt, whose patents on the steam engine restricted innovation.
The authors show other problems with the patent system. People have to spend a great deal of time and energy dealing with patents. Often years of litigation result from a patent claim, and the others show in great detail the waste that results from our present monopolistic arrangements. They explain, e.g., the dire effects of the submarine patent, in which someone patents a general idea, unworkable as it stands. The holder of the patent can then block other inventors.
Surely, though, authors and publishers need copyright protection? How could a book earn a profit without copyright? Boldrin and Levine maintain that this claim is unproved. Authors, like inventors, benefit from being first in the field. Authors made money from their work long before copyright protection was established. This book contains a profusion of arguments and is must reading for anyone interested in the economic effects of patents and copyrights.
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The table of contents is as follows:
Austrian Economics, Freedom and Peace