Comments on: Patents without Monopolies http://ipinthedigitalage.com/patents-without-monopolies/ CPSC 182 at Yale College Mon, 18 May 2009 01:26:09 +0000 hourly 1 http://wordpress.org/?v=3.0 By: Mike M http://ipinthedigitalage.com/patents-without-monopolies/comment-page-1/#comment-1918 Mike M Sat, 09 May 2009 21:45:50 +0000 http://ipinthedigitalage.com/?p=622#comment-1918 Given people's (justified, I think) concern about the auction mechanism overpricing patents, it's interesting to note that Kremer's proposal actually calls for the government to pay the inventor a markup in addition to the highest bid. Apparently, he was concerned about private bidders undervaluing patents because a private bidder cannot recover the social value of the patent. In my view, that seems to put a lot more faith in auctions than most people would be comfortable with. Given people’s (justified, I think) concern about the auction mechanism overpricing patents, it’s interesting to note that Kremer’s proposal actually calls for the government to pay the inventor a markup in addition to the highest bid. Apparently, he was concerned about private bidders undervaluing patents because a private bidder cannot recover the social value of the patent. In my view, that seems to put a lot more faith in auctions than most people would be comfortable with.

]]> By: Stuart S http://ipinthedigitalage.com/patents-without-monopolies/comment-page-1/#comment-1917 Stuart S Fri, 08 May 2009 22:23:50 +0000 http://ipinthedigitalage.com/?p=622#comment-1917 I agree. This is a very interesting proposal, but I am not sure that it is ready for implementation just yet. The cotton gin example doesn't seem all that ideal, as Whitney was essentially forced to accept the buyout due to infringement of his patent. In terms of "fair" buyouts, it would be quite hard to determine "fair" prices. I could easily see a system guided by strict rules overpaying for some patents and paying way too little for others. I think we should make sure to bolster the public domain and benefit the public good, but we should also make sure that innovators are compensated for the costs of their inventions (in addition to being compensated, however modestly, for these advancements). Interesting contribution to the general discussion! I agree. This is a very interesting proposal, but I am not sure that it is ready for implementation just yet. The cotton gin example doesn’t seem all that ideal, as Whitney was essentially forced to accept the buyout due to infringement of his patent. In terms of “fair” buyouts, it would be quite hard to determine “fair” prices. I could easily see a system guided by strict rules overpaying for some patents and paying way too little for others. I think we should make sure to bolster the public domain and benefit the public good, but we should also make sure that innovators are compensated for the costs of their inventions (in addition to being compensated, however modestly, for these advancements). Interesting contribution to the general discussion!

]]> By: Bonanza C http://ipinthedigitalage.com/patents-without-monopolies/comment-page-1/#comment-1916 Bonanza C Fri, 08 May 2009 21:14:00 +0000 http://ipinthedigitalage.com/?p=622#comment-1916 Yeah it's definitely interesting, but I'd agree with most of that second to last paragraph. The solution proposed still doesn't fix the issue of there being too many patents, some of which should not even be granted in the first place. To me, 90% seems high when I imagine how many patents that get approved might actually get used (then again I'm sure he's thought it through more than my 10 seconds of imagination). About that idea that auctions wouldn't price patents well - auctions can't even price regular items well, so the idea of it pricing a patent correctly is even harder to believe. It's called the Winner's Curse I think; the people who tend to win the auction are going to be the people who overprice items the most. Auctions then usually go for higher prices than what they should. Even using the third highest bid would probably still capture a price higher than what it deserves. Yeah it’s definitely interesting, but I’d agree with most of that second to last paragraph. The solution proposed still doesn’t fix the issue of there being too many patents, some of which should not even be granted in the first place. To me, 90% seems high when I imagine how many patents that get approved might actually get used (then again I’m sure he’s thought it through more than my 10 seconds of imagination).

About that idea that auctions wouldn’t price patents well – auctions can’t even price regular items well, so the idea of it pricing a patent correctly is even harder to believe. It’s called the Winner’s Curse I think; the people who tend to win the auction are going to be the people who overprice items the most. Auctions then usually go for higher prices than what they should. Even using the third highest bid would probably still capture a price higher than what it deserves.

]]> By: Michael L http://ipinthedigitalage.com/patents-without-monopolies/comment-page-1/#comment-1911 Michael L Thu, 07 May 2009 02:16:06 +0000 http://ipinthedigitalage.com/?p=622#comment-1911 Another potential problem I could see occuring involves the whole you're-actually-bidding-on-a-10%-chance-of-getting-the-patent idea. It just seems odd. And if those patents are random, a fair number (ie, 10%) of the patents that would really help the public are still locked up, just by another person. On the other hand, the fact that you're only bidding on a 10% chance of getting the patent rather than the patent itself would act as a downward force on the prices these things go for, which would counteract the upward forces you'd mentioned. Anywho, interesting idea though. Another potential problem I could see occuring involves the whole you’re-actually-bidding-on-a-10%-chance-of-getting-the-patent idea. It just seems odd. And if those patents are random, a fair number (ie, 10%) of the patents that would really help the public are still locked up, just by another person. On the other hand, the fact that you’re only bidding on a 10% chance of getting the patent rather than the patent itself would act as a downward force on the prices these things go for, which would counteract the upward forces you’d mentioned. Anywho, interesting idea though.

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