Law and Economics: A New Dimension in Market Regulation (original) (raw)
Related papers
Economics of Patent Law Revisited: Positing a Return on Investment Paradigm
Philippine Law Journal, 2007
Patent law seeks to spur innovation by helping ensure that the inventor secures adequate compensation for his efforts. These incentives do not come without cost. Because the inventor is given a monopoly over the use of his invention, improvements on the invention may be stunted due to the in terrorem effect of possible infringement liability. With these concomitant externalities, prominent economists have argued that current patent law and jurisprudence fail to reach an optimal compromise between return to the investor and public welfare despite their lofty aims.
2010
Intellectual Property is a very serious matter. Some estimates conclude that the current value of intellectual property significantly outweigh the value of physical propertyland, tangibles and intangibles together. A growing percentage of the GDP in industrial countries is comprised now of informational goods such as software, movies, music drugs and databases. 1 The scope of IP protection has of course significant effect on this ecconomic value and the laws regulating intellectual property in the information age are perceived as a key for economic growth. Intellectual property law, therefore, has become of immense importance. It has seen in the last decade the most significant changes since its birth following the invention of printing. The field of IP law became also an important battleground for interest groups, politicians, and different voices in civil society. The borderless nature of informational goods highlights also national interests, which are reflected in internationalization of legal arrangements and institutions in this field and in growing controversies among nations and governments.
The economics of patents: from natural rights to policy instruments
2013
This paper uses latest advances in economic research for examining recent changes in patent regimes aimed at strengthening patent protection, and beyond that, for rethinking the rationale of the patent system. Considering that economic theory does not regard patents as a natural right that should be systematically granted to inventors, but as a policy instrument aimed at fostering innovation and diffusion, three major implications can be drawn from economic theory regarding current policy debates. First, patents may not be the most effective means of protection for inventors to recover R&D investments when imitation is costly and first mover advantages are important. Moreover, they may do more bad than good to innovation if innovation is cumulative and first generation inventions are essential to develop further inventions, especially when patent protection is strong. Patents should not be seen as the solution by default, notably as regards new areas of patentability such as software, business methods and genetic inventions. Second, patentability requirements, such as novelty or non-obviousness, should be sufficiently stringent to avoid the grant of patents for inventions with low social value that increase the social cost of the patent system. Third, rather than the statutory patent life, what matters is the effective life of patents: the broader is a patent the longer is its effective life. Policy instruments affecting patent breadth (e.g. extra fee for independent claims above a certain threshold) and length (e.g. renewal fees) could be used to provide long effective lives to inventions with high social value. Beyond these currently debated issues, economic theory pleads for an in-depth reshuffling of the patent system. If the system were to be radically changed, an optimal patent policy could be based on a multidimensional menu of different degrees of patent protection associated to different patent fees, where stronger protection would correspond to higher fees. Patents could be transformed into self-selection mechanisms whereby patentees reveal the economic characteristics of their inventions, compensate society for the protection they are granted and obtain sufficient incentives to innovate.
This paper considers some implications for economic methodology of Coasean transaction cost economics. First we consider the re-evaluation of the concept of the firm, and of price as a summary statistic of economic behaviour, within the New Institutional Economics. (1) Then the notion of " contract " as a proxy for transactions and as an organising principle in economic thought is analysed. (2) The focus on contract has led on the one hand to a mathematical analysis of contract in information economics and contract theory, and on the other hand on an economic analysis of the legal concept of contract and the associated legal concept of property in the Law and Economics school. (3) We look at some issues relating to the notions of efficiency and externalities that are broached in Coase'1960 paper " The problem of social cost " and at the conflicting ways these are dealt with in economic and legal discourse. (4) We consider whether the two discourses are compatible. In particular, we discuss whether the complex system of social relations assumed in legal discourse can be adequately accounted for by recourse to the notion of a set of private bargains between individual agents that is assumed by economic positivists and writers of the Law and Economics school. (5) We discuss the concept of positivism by reference to McCloskey's analysis of the discordance between stated economic methodology and actual economic practice. (6)
Economics of Intellectual Property Law
This chapter analyzes the second wave of the economic study of intellectual property (IP) law. This second wave is characterized by two primary features: increasing methodologi cal diversity and sophistication and an emphasis on contextualization-understanding how IP law is embedded in larger social and economic systems, and how IP interacts with other aspects of those systems to foster innovative ideas and economic growth. The chap ter first discuss the many ways that second-wave scholarship seeks to show how IP rights are embedded in broader economic contexts, and thus diverges from first-wave research, which tended to focus exclusively on IP rights as the central determinants of economic activity. Next, it considers the many different methodologies being deployed to study is sues in the economics of IP rights-from large-scale empirical work to surveys to inter views to experimental research.
Intellectual Property Rights: An Economic Approach
Procedia Economics and Finance, 2014
This paper aims to analyse the intellectual property rights from an economic perspective. The paper is discussing the points of view of well known economists in relation to the positive and negative impacts of the intellectual property systems. It brings also into discussion the role of IPR as a barrier to entry and a mean to restrict competition and to favour monopoly situations.
An Introduction to Economic Analysis of Law
2020
The purpose of this article is to deal with the introductory aspects of Economic Analysis of Law (AED). To reach the objective, the research started by the interaction between the sciences of Law and Economics, their differences and convergences. Then it was about the origin of the movement, passing to the methodological premises of the economic theory based on the scarcity of resources, the maximizing rationality, the incentive structure and the question of efficiency. The research converges to demonstrate the need for dialogue and cooperation between the disciplines of Law and Economics. It is concluded that the AED, in its pragmatic and consequentialist bias, helps the jurist to understand the application of the legal norm (descriptive sense) providing the keys for understanding the choices made by the legislator on the different themes aiming at the improvement of legislation (predictive sense). The article is inserted in the branch of Legal, Social and Environmental Sciences, i...