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Promoting intellectual discovery: patents versus markets
Debrah Meloso1, Jernej Copic, Peter Bossaerts
1Bocconi University, 20136 Milan, Italy. debrah.meloso@unibocconi.it
Science (New York, N.Y.)
|March 7, 2009
Summary
This study introduces a novel "markets system" for intellectual discovery, where individuals trade shares in potential innovations. Experiments show this system outperforms traditional patent systems in promoting invention.
Area of Science:
- Intellectual Property and Innovation Economics
- Behavioral Economics
- Computational Social Science
Background:
- Patents are traditionally viewed as key drivers of intellectual discovery by granting exclusive property rights.
- Existing intellectual property frameworks may not fully optimize incentives for innovation in complex discovery processes.
Purpose of the Study:
- To propose and evaluate an alternative compensation scheme for intellectual discovery.
- To compare the efficacy of a novel "markets system" against the traditional patent system.
Main Methods:
- The study employed a "markets system" where participants held and traded shares in components of potential discoveries.
- The knapsack problem, representing complex decision-making in discovery, was used as an experimental model.
- Performance was measured by comparing outcomes from the markets system and the patent system.
Main Results:
- The proposed "markets system" demonstrated superior performance compared to the conventional patent system.
- Indirect incentives, driven by share price fluctuations, proved effective in the experimental setting.
- The knapsack problem experiments provided a quantifiable measure of system efficiency.
Conclusions:
- A decentralized markets system can be a more effective mechanism for promoting intellectual discovery than patents.
- Rethinking intellectual property rights may lead to more efficient innovation ecosystems.
- Future research could explore the scalability and real-world implementation of such market-based systems.
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