Do patents over-compensate innovators?

Abstract

Is the current level of patent protection too high or too low? To address this issue, this paper reformulates the theoretical analysis of the optimal level of patent protection to take into account the empirical findings of the innovation production function literature. This literature finds a strong relationship between R&D spending and inventions and estimates an elasticity of the supply of inventions of 0.5 or more. The paper then assesses the current level of patent protection, exploiting estimates of the private and social returns to R&D taken from the empirical literature and other available sources. Although more research is needed for a more precise assessment, the evidence available suggests that patents do not over-compensate innovators. — Vincenzo Denicolò

Cite this work

No public copy is stored for this record, so only the metadata is cited.

Stored only when both papers are in the corpus — 69 citations exist upstream.

Papers that cite the same references — the relational fallback while embeddings are still backfilling.