POL S 204 Study Guide - Quiz Guide: Fixed Cost, Human Capital, Industrial Espionage
Document Summary
Commercializing innovation: patents underpin web of contacts behind innovation = sold, license, separate, bundle, publicly recorded patent = allows coordination between parties, promote specialization = focus on comparative advantage and exchange with each other to get surplus. Other ways in which patents promote efficiency: serve as collateral to finance innovation (bank loans, promote intermediation (rights sold, appropriate gains from investors and enter the market, disclose info so other inventors can come up with new ideas. An alternative: prizes: prize instead of monopoly right = firms compete to produce at marginal cost, choose judge w expertise in assessing innovation and value, fund things w limited commercial value. 2: politicians or others can move goalposts after invention and disqualify certain innovations. Copyrights: focuses on creative expression, not ideas, novelty requirement lower than patents, duration is life of authors +70 years, duration is much longer than what it takes to recover fixed costs.
