Alex Tabarrok brings up an interesting question: Why should all patents have the same length?
Pharmaceuticals are really the classic case of where the [ratio of] innovation-to-imitation costs are extraordinarily high. It costs about a billion dollars to create a new pharmaceutical. The first pill costs a billion dollars; the second pill costs 50 cents. So, that’s a classic ase where imitation costs really are low. That’s the best case for patents, in a field like that.
But my question is: Why does every innovation deserve or require the same 20-year patent? Why do we have a system which gives a one billion dollar pharmaceutical—where there’s $1 billion in research and development costs—we give that a 20-year patent and one-click shopping gets the same 20-year patent? That makes no sense whatsoever.
So, what I suggest is a more flexible system. I’d like to have a 20-year patent, maybe a 15-year patent, maybe a 3-year patent. Something like that. And then we could say: You want to apply for a 3-year patent? We are going to get this through the system quickly; we won’t look at it so much. … You want a 20-year patent, though, you’d better show us that you really are deserving and put some costs in there.
I don’t like software patents, though I don’t see them going away. But it might be possible to pass legislation to reduce the length of software patents.
See also this post about the tragedy of the anti-commons. The tragedy of the commons is misuse of a resource nobody owns. The tragedy of the anti-commons is the under-use of a resource that too many people own.
Building a DVD player requires using hundreds of patented inventions. No company could ever build a DVD player if it had to negotiate with all patent holders and obtain their unanimous consent. … Fortunately, the owners of the patents used in building DVD players have formed a single entity authorized to negotiate on their behalf. But if you’re creating something new that does not have an organized group of patent holders, there are real problems.