A Patent and a Prize

Hylton Keith N. ()
Additional contact information
Hylton Keith N.: Boston University and Boston University School of Law, Boston, USA

Review of Law & Economics, 2024, vol. 20, issue 3, 413-438

Abstract: This paper examines a simple and old question: should innovators receive a patent or a prize? The answer I provide is equally simple: they should receive both. The literature on patents versus prizes has proceeded mostly under the assumption that there should be a choice between a regime of patents and a regime of prizes in which patents fall into the public domain upon award of the prize. There are significant “public choice costs” under the prize plans. By this I mean there are risks of inappropriate transfers to patentees – that is, looting – and of confiscation of patentees, through the conduct of or through the omissions of government agents. The innovation regime I propose is a patent-plus-prize scheme. The patentee would receive the patent and a prize that approximates consumer surplus. Public choice costs are considerably lower than under prize schemes: there would be no looting and no risk of confiscation under patent-plus-prize. In addition, private and social incentives to innovate are aligned.

Keywords: patents; patent prizes; innovation; monopoly; public choice (search for similar items in EconPapers)
JEL-codes: O31 O34 O38 (search for similar items in EconPapers)
Date: 2024
References: Add references at CitEc
Citations:

Downloads: (external link)
https://doi.org/10.1515/rle-2024-0096 (text/html)
For access to full text, subscription to the journal or payment for the individual article is required.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bpj:rlecon:v:20:y:2024:i:3:p:413-438:n:1004

Ordering information: This journal article can be ordered from
https://www.degruyter.com/journal/key/rle/html

DOI: 10.1515/rle-2024-0096

Access Statistics for this article

Review of Law & Economics is currently edited by Francesco Parisi

More articles in Review of Law & Economics from De Gruyter
Bibliographic data for series maintained by Peter Golla ().