KU News Release

July 6, 2009
Contact: Mindie Paget, School of Law, (785) 864-9205

Study: Patent systems may not encourage invention of new technologies

Andrew Torrance

More Information

LAWRENCE — A new study co-authored by a University of Kansas professor challenges the traditional view that patents foster innovation, suggesting instead that patents may harm new technology, economic activity and societal wealth.

The results, published in the Columbia Science and Technology Law Review, may have important policy implications because many countries count on patent systems to spur new technology and promote economic growth.

To test the hypothesis that patent systems promote technological innovation, Andrew Torrance of the KU School of Law and Bill Tomlinson of the University of California-Irvine’s Bren School of Information and Computer Sciences developed an online simulation game of the patent system, PatentSim. Their results suggest that a patent system underperforms a “commons,” in which no patent protection is available, on several important measures.

Although these surprising results call into question traditional justifications for patent systems, they do align with the increasingly well-supported notion that user and open innovation can succeed where patents may fail.

PatentSim uses an abstract model of the innovation process, a database of potential innovations, and a network over which users may interact with one another to license, assign, buy, infringe and enforce patents. PatentSim allows users to simulate the innovation process in one of three scenarios: a patent system, a “commons” system with no patents or a system with both patents and open source protection.

“In PatentSim, we found that the patent system did not work to spur innovation,” Tomlinson said. “In fact, participants were more likely to innovate when there was no intellectual property protection at all, or when they could open source their innovations and share them with other people.”

The researchers measured the efficacy of the patent system based on innovation — the number of unique inventions; productivity — a measure of economic activity; and societal wealth — the ability to generate money.

The subjects of the simulation game were first-year law students who had never had any intellectual property coursework. Torrance and Tomlinson plan to conduct further simulations with subjects of different backgrounds, including master’s of business administration students at Harvard University.

“Current patent laws are based on assumptions that patents spur technological progress that were considered settled more than a century ago, and that few have questioned since then,” Torrance said. “If it turns out that our laws are based upon misinformation and bad assumptions, society may be failing to promote beneficial new technologies that could improve potential quality of life.”

The full paper, “Patents and the Regress of Useful Arts,” is ranked in the top 10 recently uploaded publications in Law and Economics on the Social Science Research Network Web site, the leading social sciences scholarly publication database, and is available for free download at http://papers.ssrn.com/abstract=1411328.

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