CEPR - Center for Economic and Policy Research


En Español

Em Português

Other Languages

Home Publications Blogs Beat the Press China Teaches Apple About the Inefficiency of the Patent System

China Teaches Apple About the Inefficiency of the Patent System

Friday, 31 August 2012 05:38

The United States doesn't understand much about free markets. If it did, people here would realize that patents and copyrights are big government, not the free market. China is trying to teach this lesson to Apple. As the Post reports, a Chinese firm is filing a patent infringement lawsuit against Apple.

This is undoubtedly the first of many such suits. Strong patent laws are likely to create many high-paying jobs for lawyers, however they are almost certainly an impediment to innovation in the 21st century. Unfortunately, because protectionists so completely dominate public debate, fundamental reform of patent policy is not even being considered by leading political figures in either political party.

Comments (4)Add Comment
written by Hugh Sansom, August 31, 2012 12:33
Not only is reform ignored by leading Democrats and Republicans, the process is now under way to make parent restrictions even more onerous. The US Trade Representative is working with other states on the Trans-Pacific Partnership Agreement — in extraordinarily secretive conditions.

The Electronic Frontier Foundation has reported extensively on the TPP here: https://www.eff.org/issues/tpp
written by Aaron, August 31, 2012 1:45
The most amazing thing about patents is probably that, unlike copyrights, industry has not successfully lobbied for their extension from a couple of decades to "forever". The reason for that, of course, is that on the whole companies see more gain in having their competitors' patents expire than in the extension of their own patents.

Google appeared to be on the side of reform; now they seem to be resigned to the status quo and are accumulating their own massive library of patents to use as a defense against other companies' claims (and perhaps more aggressively against competing products, as well). If you want reform, there's a lot to overcome.

Where can we find some good ideas on what reform might look like? I follow patent issues somewhat passively, but for all of the problems that get attention (patent trolls, dubious software patents, litigation instead of competition, etc.) I'm not seeing much in the way of "Here's how we can fix the problem, or at least make things better."
written by Last Mover, August 31, 2012 2:48
That'll show 'em, by China that is. As the saying goes, while economic freedom does not require political freedom, political freedom does require economic freedom.
This could well work to China's and Asia's advantage.
written by John Wright, August 31, 2012 4:04
As the USA, per the always confident Tom Friedman, is to be the innovation center for the world, then the USA will need to extract money from around the world for those USA innovative ideas as value added manufacturing won't be occurring here.

But China and other countries won't be as influenced by the "tragedy of the anti-commons", in which USA innovators don't develop some future products because they can't cost effectively license the various pieces of intellectual property needed to produce the new products.

So the USA patent and IP laws could have the effect of restricting innovation in the USA and pushing it to other countries that aren't as concerned about USA intellectual property laws.

Write comment

(Only one link allowed per comment)

This content has been locked. You can no longer post any comments.


Support this blog, donate
Combined Federal Campaign #79613

About Beat the Press

Dean Baker is co-director of the Center for Economic and Policy Research in Washington, D.C. He is the author of several books, his latest being The End of Loser Liberalism: Making Markets Progressive. Read more about Dean.