Washington Times:
Government’s protection of property is critical to economic growth. That includes protecting intellectual property - or IP - such as inventions and innovations through patents.
This should be obvious, particularly in today’s high-tech economy. But history also provides a reminder that protecting IP has been an economic imperative for some time.
For example, Nobel Prize winning economist Douglass C. North argued that ‘the Industrial Revolution was an acceleration in the rate of innovation’ due to ‘better specified property rights,’ which raised ‘the rate of return on innovating.’
He explained: ‘The failure to develop systematic property rights in innovation up until fairly modern times was a major source of the slow pace of technological change.’ Mr. North added that ‘a systematic set of incentives to encourage technological change and raise the private rate of return on innovation closer to the social rate of return was established only with the patent system.’
Indeed, property rights provide a necessary foundation for what might be called the four ‘i’s’ - investment, improvement, innovation and invention. Why invest, improve, innovate or invent, if others are free, in effect, to steal those investments, improvements, innovations or inventions? Continue reading…
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