17 October 2007

Patently Wrong, Mathematically Proved

Well, after yesterday's post about a paper drawing fascinating parallels between today's patent trolls and yesteryear's patent sharks, here's another zinger from academia, one of whose authors has just won this year's Nobel-ish prize for Economics. And look what it says:

the software industry in the United States was subjected to a revealing natural experiment in the 1980’s. Through a sequence of court decisions, patent protection for computer programs was significantly strengthened. We will show that, far from unleashing a flurry of new innovative activity, these stronger property rights ushered in a period of stagnant, if not declining, R&D among those industries and firms that patented most.

We maintain, furthermore, that there was nothing paradoxical about this outcome. For industries like software or computers, there is actually good reason to believe that imitation promotes innovation and that strong patents (long patents of broad scope) inhibit it. Society might be well served if such industries had only limited intellectual property protection. Moreover, many firms might genuinely welcome competition and the prospect of being imitated.

What's interesting about this - aside from the fact that a respected economist is arguing against patents for industries like software, and using maths to prove it - is that the whole idea of welcoming competition so that everyone can build on the communal advances is incredibly close to the underlying dynamic of open source, which gets better much faster because it can always draw on the work of others.

So essentially the result of the paper is that industries like software work better (a) without patents and (b) when they operate according to the open source development model. Imagine. (Via Slashdot.)

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