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Public Prizes versus Market Prices: Should Contests Replace Patents?, Journal of the Patent and Trademark Office Society

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.

Type

Article

Author(s)

Daniel Spulber

Date Published

2015

Citations

Spulber, Daniel. 2015. Public Prizes versus Market Prices: Should Contests Replace Patents?. Journal of the Patent and Trademark Office Society. 97(4): pp. 690-735.

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