I have read Che Guevara who predicted the emergence of a "new man" under island socialism that would be less interested in selfish greed (meaning capitalism), and would be more in tune with the needs of the community. Che didn’t live to see such societal change. It is difficult to test the underlying "market" policy that innovation can be maximized through protection of intellectual property rights. So I was intrigued when modeling was developed called "PatentSim(TM)".
The authors conclude that their data shows "current patent systems may significantly deter, rather than spur, technological innovation compared to a commons system."
Jump for details.
Anecdotal evidence abounds. A few years back, Metallica's drummer sat at a press conference spouting what may have been drunken stupor that he wouldn’t be motivated to make his music without copywrite protection from the likes of Napster. I scratched my head. Then I watched for years as the music industry sued grandmothers and other casual users for illegally copying intellectual property. I questioned the music industry’s business model, like Blockbuster getting 25% of its revenue from "late fees", or the short-term "closed source" model of Gates, etc. China is renowned for not really enforcing intellectual property rights. DVD’s are available within a week of a new movie’s release in China and later along Santee Alley in LA for about five bucks. The lack of protection in China doesn't seem to have reduced innovation in Asian industrialists, but we can always blame the gaggle of bad US movies on them infringers. Another analogy in the US, is that in order to avoid opposition to his health care reforms, Obama made a deal with BIG PHARMA to give them 12 years use of a drug formula before any competition from a generic version of the drug would be allowed. This blows an even more giant "donut" hole in Medicare Part D. An analogous area of intellectual property protections exists and is called patents.
But a study just out questions the underlying social benefits of guarding intellectual property rights and it may break down the paradigm of "new" versus "capitalist" man.
PatentSim(TM) uses an abstracted and cumulative model of the invention process, a database of potential innovations, an interactive interface that allows users to invent, patent, or open source these innovations, and a network over which users may interact with one another to license, assign, buy, infringe, and enforce patents.
. . .
The results of this study are inconsistent with the orthodox justification for patent systems. However, they do accord well with evidence from the increasingly important field of user and open innovation.
The prior studies of the supposed benefits from a patent system for inventors are shown to yield inconclusive results and "the implications of the theories are very sensitive to the assumed context conditions." This reminded me of the individual inventor of the circuitry that makes your windshield wipers "delay" during their "on" function. The major car manufacturers didn’t negotiate any license from him, they just began mass production and installation of the circuits on their vehicles. This is called infringement. But as any large industry executive will tell you, between the right to collect royalties and implementation of that right is a very long highway. Years of battle, costing the man more than $10 Million, left the inventor disillusioned with the whole system and having spent his whole recovery in attorneys fees to enforce his right to an incentive for his discovery. His assumed content conditions of the patent system resulted in dismay for the rest of his life.
Other, large studies by the volunteer social scientists at the National Academies concur in finding little support for the incentives of patent law.
Despite abundant studies into patents and technological innovation, including theoretical work spanning more than a century and [e]mpirical work by a number of economists over nearly fifty years, the National Academies concluded that the literature on the impact of patents on innovation must be considered emergent.
The authors of the new study also point to other studies that have
identified empirical evidence that, in the software industry at least, on average, as firms’ investments in patent protection go up, their investments in research and development actually go down.
Now, I still have two questions: 1) if the authors had not been able to Trade Mark the name of their Sim Game, would they still have written it? and 2) Can we really trust the volunteer scientists at the National Academies without a financial incentive to do anything?