Abstract
I consider whether government prizes should replace market prices for inventions. The America COMPETES Reauthorization Act of 2010 establishes a framework for government prizes I examine how antitrust and public policy towards patents should take into account the economic benefits of the market for inventions. I compare the market price system with government prize systems in terms of economic efficiency. I find that the deadweight welfare loss argument for replacing market prices with government prizes is flawed. I show how prices in the market for inventions provide state-contingent signals that guide invention, commercialization, innovation, financing, and complementary inventions. I examine how prices in the market for inventions provide indicators of technological change. I conclude that replacing market prices with government prizes would harm invention, innovation and economic growth.
| Original language | English (US) |
|---|---|
| Pages (from-to) | 690-735 |
| Number of pages | 46 |
| Journal | Journal of the Patent and Trademark Office Society |
| Volume | 97 |
| Issue number | 4 |
| State | Published - 2015 |