Should Patent Protection be Extended to All Countries?

Abstract

As is well known, a primary reason for providing patent protection is to permit Inventors to earn a return on their inventions, and therefore to provide an incentive for technology to advance. The cost of providing patent protection, however, is that it permits the patent holder to exercise monopoly power over the market for the new product, and thus prevents the benefits of the new product from being enjoyed optimally by consumers. It is for this reason, some have argued, that patent protection is granted for only a limited time, so as to achieve a desirable balance between incentives to invent and gains to consumers from products after they have been invented. I will argue that the same sort of trade-off may also justify limiting patent protection geographically, as well as over time.