Gorman Lectures 2015

by Jean Tirole (Toulouse School of Economics)


5.30pm-7pm, Tue 24th Feb  - Intellectual Property and Public Policy I

5.30pm-7pm, Wed 25th Feb - Intellectual Property and Public Policy II

Sponsored by Princeton University Press
Princeton University Press

Intellectual Property and Public Policy

One of the key markets in our knowledge economy is the market for intellectual property. The future of several industries hinges on public policy with regards to patent granting and licensing, copyright, trade secrets, open source solutions and standard setting. How can we stimulate widespread technology diffusion and reward only truly innovative contributions? In particular, public policy confronts two major issues concerning the diffusion and sharing of intellectual property.

First, new technologies tend to be covered by a wide array of patents issued to the different firms that contribute components to the technology. This patent thicket is conducive to “royalty stacking”, threatening the diffusion of the technology. It has accordingly been proposed that antitrust authorities stop discouraging patent pools, which are institutions through which owners of different pieces of intellectual property jointly market their licenses. Patent pools dominated the industrial world until an adverse landmark decision of the US Supreme Court in 1945, and now are making an impressive comeback in high tech industries. Patent pools, if poorly structured, however can be strongly anticompetitive. The lectures will discuss public policies toward patent pools and more generally co-marketing arrangements among potential competitors.

Second, when standardization is necessary, in many cases there are multiple routes to solving a given technological problem. Each one of these may be equally viable, but often a standards body will choose only one avenue. After the decision is made, however, the chosen patent becomes a “standard-essential patent,” and the patent owner can ask for a high royalty even when other patents could have offered comparable value, had the technology been morphed differently.  Standard essential patents have motivated for instance the ongoing disputes over smartphone patents. The lectures will discuss whether the standard-setting process should be regulated and how.
Finally, the lectures will discuss various other issues regarding the future of intellectual property policy.

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