Milton Friedman on the Distorting Effect of Patents

by Stephan Kinsella on July 3, 2011

Friedman wrote, in Capitalism and Freedom:

there are many “inventions” that are not patentable. The “inventor” of the supermarket, for example, conferred great benefits on his fellowmen for which he could not charge them. Insofar as the same kind of ability is required for the one kind of invention as for the other, the existence of patents tends to divert activity to patentable inventions.

As I noted in The Forgotten Costs of the Patent System, the patent system “skews resources away from theoretical R&D and toward practical gizmos and applications,which surely has some cost as well”. Friedman recognized this, but still, bizarrely, supported patents (though he wanted shorter terms). Rothbard also recognized this, but, unlike Friedman, opposed patents.

Share

Facebook comments:

{ 3 comments… read them below or add one }

JS February 16, 2012 at 8:47 am

What I create is mine and I should be able to do anything I want with it, including not letting others exploit MY ideas. How can you support free markets and not support patenting? It’s absurd. Patents protect freedom.

Mike May 1, 2012 at 2:32 pm

Only goods can be property. Ideas are not goods. If neuroscience has taught us anything, it’s that ideas are real parts of people’s brains. You can’t direct in the creation of a part of a person’s brain and then claim to own it. That’s like a surgeon recreating a person’s face and then demanding payment for the use of that face.

William Dais September 23, 2012 at 9:16 pm

I agree with Mike. Patent laws are antithetical to free markets…they are government intervention to stop one company from competing with another.

{ 6 trackbacks }

Previous post:

Next post: