When I read the bit on the steam engine, I remember thinking it wasn’t a great argument as it was hard to know how a patent-less world would have developed. I’m not surprised to see there’s a link which talks about how the claim was exaggerated (though not entirely wrong? I’ll have to read it).
Having said that, the bits I found juicy - i.e on the various shock analyses coming from patent introductions or increasing of scope, the studies on how effective first mover advantages was etc. all seemed pretty solid when I checked the sources - admittedly they were deeper into the book, so you may have already abandoned it by then.
> There are many other economists who have shown significant beneficial aspects of patents with empirical data but they conveniently don’t get mentioned at all.
Any chance you have some to share? When I LLM’d the topic a while ago the best I got was some weak investment effect in Singapore (unaccompanied by TFP/etc).
You’ll have to forgive me if my answer isn’t super satisfying - it’s possible, but I’d want to see patents under these conditions empirically validated.
Some things you might find interesting - the author(s) make various arguments such as:
1) Ranking (by various metrics/criteria) the most impactful medicines and making the case that the ones developed independently from patents are both over represented and more impactful. (There was some stuff around what kind of medicines are incentivised with each regime)
2) I don’t exactly remember what they say about R&D costs increasing with time (aside from (1)-style skepticism), but they did talk how as time went on, logistics/distribution/marketing technology has grown immeasurably, so the window one has before the copycats come in can be exploited with a lot more gusto.
3) Reverse engineering of medicines + especially their industrialisation takes longer (and requires more capital) than people think, and there’s a bit of a conundrum where, because you don’t know which medicines will be commercially successful, you have to wait to see how they perform on the market… but the longer you wait, the more (2) happens (and the more you have to fight first mover advantage, established marketing etc)
The points are more rigorously covered in the book - (2)+(3) had papers that quantified the stated effects in question.
I will stress again though that while the “counter-narratives” are interesting and may help build some intuition, I would set the gold standard to some econometric/shock-analysis of patents in action.
The book goes into quite a bit of depth if it is a topic that interests you.
I would flag that we’re getting into “prove a negative” territory here: the goalpost is that we need to prove empirically that patents achieve the desired outcome. If the scenario you describe accounts for all game-theory/incentive/complex-adaptive-system universes, we should see this reflected in the data.
When it comes to pharmaceuticals, they looked into Italy and Switzerland who switched to a patent system in 1978 (and I believe Portugal in the 1990s). They looked at the growth curves of things like # of inventions, total factor productivity, percentage R&D spending, and the conclusion was that there was no statistically significant change in trajectory that would suggest the introduction of the patents had any positive effects. (Edit: they accounted for domestic/international + US filings before/after as well).
There are two things to tackle here which I’m keen not to mix up as I think their epistemological properties are quite different:
1) [the stronger one] while the scenario/narrative is a compelling one (or maybe it just feels compelling as I’ve heard it so many times), if it doesn’t have experimental/data backing I have to abandon it.
2) [the weaker one, as it replaces a narrative with another narrative within a complex system] I’ll only give the highlights as the arguments are a lot more eloquently laid out in the book; part of it is comparing the force of “many inventor nodes building on top of many invention nodes” vs “inventor nodes (with more investment individually?) building on top of fewer invention nodes”, part of it is the game theory effect of companies collectively investing less (proportionally) in R&D as the ROI from lawyers under this regime has more power, part of it was that actually, the reverse-engineering-simplicity story was too overblown and that actually the friction + domain knowledge has a stronger effect than people think (they published a paper on this). There were others, but it’s been a while now!
The book “against intellectual monopoly” has shaped a lot of my thinking on this topic - economists have looked at the various occasions in which patents were introduced into an industry (or extended in scope), and there is no evidence they actually improve innovation/efficiency/outcomes (including the pharma industry!). I was quite surprised as my whole life, it was sold to me as an incentive-boosting measure which in turn would lead to said outcomes.
With that lens, I welcome gradually phasing this stuff out, especially as we navigate into the unknown game-theory landscape AI-as-inventors brings.
Francesco Mazzoli’s blog on https://mazzo.li/archive.html. His blog has topped HN a few times with various low-level/linux topics, some deep dives into algorithms etc.
Having said that, the bits I found juicy - i.e on the various shock analyses coming from patent introductions or increasing of scope, the studies on how effective first mover advantages was etc. all seemed pretty solid when I checked the sources - admittedly they were deeper into the book, so you may have already abandoned it by then.
> There are many other economists who have shown significant beneficial aspects of patents with empirical data but they conveniently don’t get mentioned at all.
Any chance you have some to share? When I LLM’d the topic a while ago the best I got was some weak investment effect in Singapore (unaccompanied by TFP/etc).