Octavo Dia

Thursday, June 27, 2013

How to Fix the Patent System

I know I've written about this subject before, but it's been eight years, so I figure I get a mulligan!

The basic rationale for patents is that they provide a societal good by causing information that would otherwise be kept secret to be released to the general public.  However, I'm sure we can agree that the patent system that we have is broken (even if we're not ready to get rid of it entirely) and not provided the societal good it is intended to.  If the purpose of patents is to stimulate innovation by compensating inventors for sharing secrets, why not make the compensation explicit?  I propose a very simple rule: there are no patents, but eminent domain applies to intellectual property.  If there is a vital trade secret, the government could simply appropriate the idea and compensate the inventor accordingly.  The inventor would still have the advantage of experience, being the first mover, and the government compensation to boot, but everyone could use and build of the idea, giving competition free rein.