Friday, September 14, 2012

Just a thought. If we consider a patent to be an option (long-term call) on a particular innovation, then the government is the seller of the option at time 0; the inventor is the buyer at time 0, and the innovator is the buyer at time 1.

Given that only 1-2% of patents are commercially valuable and many of them fall apart in courts, does the government have an incentive to sell a lot of useless calls?

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