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C. The Patent System's Enthusiasm for Artificial Intelligence

The last section illustrated that there is much to be excited about concerning AI. The USPTO's interest in artificial intelligence signals a critical moment for U.S. innovation. Evidence suggests that the patent system is becoming less accessible to small businesses, women, and minorities. 230 Research from other domains reveals that artificial intelligence, when applied to a problem with blind technological optimism, furthers disparities in power. 231 If the U.S. ignores these trends, then it risks further alienating small businesses and innovators that have been integral to the story of U.S. innovation. This section describes the problem in further detail.

Sometimes, it takes a monumental event in an unfamiliar sector to open our eyes to how complex and important things are, and how much the general public doesn’t understand. The recent banking crisis has been such an event. Despite the fact that private market investing and venture capital (VC) are critical factors in our nation’s position as a global innovation leader, it’s relatively unfamiliar to many people.

In an effort to create some clarity and understanding, this VC primer explains how VC works and why it’s so important to founders seeking capital and to investors seeking to diversify their portfolios.

The best way to deal with patent trolls is to abolish patents. The proposed legislation you referred to in your editorial ("Patent trolls in crosshairs," March 19) may cut out some of the worst abuses, though government has a long record of making things worse. But the very idea of patents is to stop somebody from doing something that will benefit you.

Holders of patents claim lots of benefits, but research consistently shows these benefits can't be found or are the reverse: limits that hamper us. The only actual benefit is for them, in the form of money from our pocket.

If past trends continue, the world’s gross domestic product will be about twice as big by 2040 as it is today. That’s the sort of growth rate that translates to 30-fold growth over a century, or by a factor of a thousand over two centuries.

Is that miraculous, or apocalyptic? In itself, neither. GDP is a synthetic statistic, invented to help us put a measuring rod up against the ordinary business of life. It measures neither the energy and resource consumption that might worry us, nor the things that really lead to human flourishing.

In 2016 the economist and columnist Noah Smith reviewed the evidence on poverty around the world, and his conclusion was notably exuberant: "This is incredible—nothing short of a miracle. Nothing like this has ever happened before in recorded history." A graph created by Max Roser clearly reveals the "miracle" Smith was talking about, and how right he was that the improvement is without precedent. The graph doesn't show the percentage of people living in poverty, but instead something even more important: the total number of extremely poor people on earth.

The World's War on Poverty

Military production depends on the consumption of large quantities of fossil fuels and involves countless other environmentally destructive processes. The mining, refining and production of some of the key resources employed in military production, like aluminium, steel and nickel, are highly energy intensive, producing massive emissions of carbon dioxide and other greenhouse gases.

Over half the energy required for aluminium smelting is currently produced by burning coal, and the perfluorocarbons released during the smelting process are between 6,500 and 9,200 times more potent as drivers of global warming than carbon dioxide. Nickel mining emits millions of tonnes of toxic sulphur dioxide per year, and has a history of severe pollution of the land, air and water surrounding mines—such as when a major spill from the Norilsk nickel factory in Russia turned the Daldykan river bright red in 2016.

This article’s contribution is two-pronged: it argues that IR theory regarding the causes of conflict and war is deeply flawed, locked for decades in ultimately futile debates over narrow, misconstrued concepts; this conceptual confusion is untangled and the debate is transcended once a broader, comprehensive, and evolutionarily informed perspective is adopted. Thus attempts to find the root cause of war in the nature of either the individual, the state, or the international system are fundamentally misplaced. In all these ‘levels’ there are necessary but not sufficient causes for war, and the whole cannot be broken into pieces.13 People’s needs and desires — which may be pursued violently — as well as the resulting quest for power and the state of mutual apprehension which fuel the security dilemma are all molded in human nature (some of them existing only as options, potentials, and skills in a behavioral ‘tool kit’); they are so molded because of strong evolutionary pressures that have shaped humans in their struggle for survival over geological times, when all the above literally constituted matters of life and death. The violent option of human competition has been largely curbed within states, yet is occasionally taken up on a large scale between states because of the anarchic nature of the inter-state system. However, returning to step one, international anarchy in and of itself would not be an explanation for war were it not for the potential for violence in a fundamental state of competition over scarce resources that is imbedded in reality and, consequently, in human nature. The necessary and sufficient causes of war — that obviously have to be filled with the particulars of the case in any specific war — are thus as follows: politically organized actors that operate in an environment where no superior authority effectively monopolizes power resort to violence when they assess it to be their most cost-effective option for winning and/or defending evolution-shaped objects of desire, and/or their power in the system that can help them win and/or defend those desired goods.

It has become fashionable on social media and in certain publications to argue that capitalism is killing the planet. Even renowned investor Jeremy Grantham, hardly a radical, made that assertion last year. The basic idea is that the profit motive drives the private sector to spew carbon into the air with reckless abandon. Though many economists and some climate activists believe that the problem is best addressed by modifying market incentives with a carbon tax, many activists believe that the problem can’t be addressed without rebuilding the economy along centrally planned lines.

The climate threat is certainly dire, and carbon taxes are unlikely to be enough to solve the problem. But eco-socialism is probably not going to be an effective method of addressing that threat. Dismantling an entire economic system is never easy, and probably would touch off armed conflict and major asdasd upheaval. In the scramble to win those battles, even the socialists would almost certainly abandon their limitation on fossil-fuel use — either to support military efforts, or to keep the population from turning against them. The precedent here is the Soviet Union, whose multidecade effort to reshape its economy by force amid confrontation with the West led to profound environmental degradation. The world's climate does not have several decades to spare.

There are important elements of truth in such views, but we should also be careful to not push this point too far. Some commentators have argued that one silver lining outcome of the pandemic was that, because of the economic lockdown, fossil fuel consumption and CO2 emissions plunged alongside overall economic activity during the recession. While this is true, I do not see any positive lessons here with respect to advancing a viable emissions program that can get us to net zero emissions by 2050. Rather, the experience demonstrates why a degrowth approach to emissions reduction is unworkable. Emissions did indeed fall sharply because of the pandemic and the recession. But that is only because incomes collapsed and unemployment spiked over this same period. This only reinforces the conclusion that the only effective climate stabilization path is the Green New Deal, as it is the only one that does not require a drastic contraction (or “degrowth”) of jobs and incomes to drive down emissions.

A genuinely positive development of the pandemic and recession is that progressive activists around the world have fought to include Green New Deal investments in their countries’ economic stimulus programs. It is critical to keep pushing the development and success of these initiatives.

Hard Truths about a ‘Top-Down’ Transition ¶ I wish to conclude by acknowledging several hard truths about the feasibility of a ‘top down’ transition to a post-growth economy. The first is to note that cultures around the world, especially in the developed world, are not close to being ready to take the idea of a post-growth economy seriously. In Australia, for example, our current and prospective governments are all firmly embedded in the growth paradigm and they show no signs of questioning it – none at all. At the cultural level, the expectation of ever-increasing affluence (which assumes continued growth) is as strong as ever. In this political and cultural context, the policy proposals outlined above – however necessary they might be to confronting the limits to growth predicament – will strike most people as wildly unrealistic, overly interventionist, and probably undesirable. I am not so deluded as to think otherwise.¶ The second point to note, subtly linked to the first, is that the powers-that-be would not tolerate these policies for a post-growth economy. To provide a case in point,when a relatively fringe Occupy Movement in 2011 began to challenge undue corporate influence on democracy and make noise about wealth inequality, soon enough the executive branches of government bore down upon the activists and stamped out the opposition. Mainstream media made little effort to understand the movement. Given that a postgrowth economy would directly undermine the economic interests of the most powerful corporations and institutions in society, one should expect merciless and sustained resistance from these vested interests if a post-growth movement ever began gaining ascendency.¶ The third point to note – and probably the most challenging – is that, in a globalised world order, even the bold policies proposed above would be unlikely to produce a stable and flourishing post-growth economy. After all, how would the stock markets react if a government announced a policy agenda that would deliberately aim to contract the economy for environmental and social justice reasons? More specifically, how would the stock markets react if a government, in pursuit of sustainability and global equity, introduced a diminishing resource cap that sought to phase out the most damaging industries and reduce resource consumption by 80% of current Australian levels? I suspect there would be utter turmoil, ultimately leading to an economic crash far greater than the global financial crisis. My point is that it may well be impossible to implement a smooth ‘top down’ transition to a post-growth economy, even if a strong social movement developed that wanted this. The market economies we know today would be unlikely to be able to adjust to the types and speed of foundational changes required. A ‘great disruption’ of some form may be a necessary or inevitable part of the transition beyond growth.¶ To make matters more challenging still, in a globalised economy, it is not clear whether a single nation could adopt a post-growth economy without inducing a range of antagonistic reactions from other nations. On the one hand, there is a web of international ‘free trade’ agreements that make such a move highly problematic, and could even provoke sanctions from international institutions or other governments. On the other hand, in a globalised economy there is always the threat of capital flight the moment a government threatens to defy the neoliberal logic of profit-maximisation or talks of wealth redistribution. There is also the geopolitical risk of being a leader in a post-growth transition, as this may involve fewer funds available for military forces,weakening a nation’s relative power globally. All of these issues radically call into question the feasibility of a ‘top down’ transition to a post-growth economy, and yet these challenges are rarely acknowledged in the post-growth literature.

Is war becoming obsolete? There is wide agreement among scholars that war has been in sharp decline since the defeat of the Axis powers in 1945, even as there is little agreement as to its cause.1 Realists reject the idea that this trend will continue, citing states' concerns with the “security dilemma”: that is, in anarchy states must assume that any state that can attack will; therefore, power equals threat, and changes in relative power result in conflict and war.2 Discussing the rise of China, Graham Allison calls this condition “Thucydides's Trap,” a reference to the ancient Greek's claim that Sparta's fear of Athens' growing power led to the Peloponnesian War.3

This article argues that there is no Thucydides Trap in international politics. Rather, the world is moving rapidly toward permanent peace, possibly in our lifetime. Drawing on economic norms theory,4 I show that what sometimes appears to be a Thucydides Trap may instead be a function of factors strictly internal to states and that these factors vary among them. In brief, leaders of states with advanced market-oriented economies have foremost interests in the principle of self-determination for all states, large and small, as the foundation for a robust global marketplace. War among these states, even making preparations for war, is not possible, because they are in a natural alliance to preserve and protect the global order. In contrast, leaders of states with weak internal markets have little interest in the global marketplace; they pursue wealth not through commerce, but through wars of expansion and demands for tribute. For these states, power equals threat, and therefore they tend to balance against the power of all states. Fearing stronger states, however, minor powers with weak internal markets tend to constrain their expansionist inclinations and, for security reasons, bandwagon with the relatively benign market-oriented powers.

It is not social policy but capitalism that has created today’s prosperity.

What is important is that what made today’s mass prosperity possible – a phenomenon unprecedented in history – was not social policy or social legislation, organised trade union pressure, or corrective interventions in the capitalist economy, but rather market capitalism itself, due to its enormous potential for innovation and the ever-increasing productivity of human labour that resulted from it.

---causes wars because it forces political upheaval and people will fight to keep capitalism which is both offense and means alt fails

---US has decreased emissions now, sustainable energy like wind, solar, and hydro solve, our ev cites a report that looked at over 7000 cases says sustainable is competitive and will be adopted universally in 10 years

What are the purposes or objectives of the antitrust laws? There are several ways to answer this question. To answer it descriptively, one could look at the history of antitrust enforcement and ask who the antitrust laws have actually benefited or what they have achieved over time as they have been enforced. As the economist George Stigler wrote, “The announced goals of a policy are sometimes unrelated or perversely related to its actual effect and the truly intended effects should be deduced from the actual effects” (Stigler 1975, 140). The actual beneficiaries of antitrust enforcement may be quite different from those intended by the legislative framers of the antitrust statutes or the ones proposed by normative theorists. The answer to the descriptive question is contested. Public choice scholars have claimed that the history of US antitrust enforcers shows that small, inefficient businesses are the primary beneficiaries of antitrust enforcement, often at the expense of consumers and economic efficiency (McChesney and Shughart 1995). Many antitrust advocates would contest this claim and argue that consumers have been the primary beneficiaries of antitrust enforcement. In this chapter, I will not attempt to answer the empirical question. One could also attempt to answer the rationale question as a matter of legislative intent by looking to the intentions of the framers of the Sherman Act (1890) in the United States, the Treaty of Rome (1957), reborn in 2009 as the Treaty on the Functioning of the European Union (“TFEU”), or the foundational antitrust statute of any of the more than 100 nations that currently have antitrust laws. Such an approach is highly contestable too. Claims about the intentions of the framers of the Sherman Act, for example, have been controversial. The Chicago School theorist Robert Bork claimed to locate an economic efficiency objective in the congressional minds of 1890 (Bork 1978). Subsequent scholarship refuted Bork’s claim, finding the avoidance of wealth transfers from consumers to producers or protection of small, inefficient businesses to be the predominant legislative purposes (Lande 1982, DiLorenzo 1985, Hovenkamp 1988, Hazlett 1992). A third approach to determining antitrust rationales is to engage in a free-form normative debate about the role of monopoly, competition, law, and regulation in modern society. Should we have antitrust laws and, if so, why? This is where most of the action is today. Most scholars and antitrust practitioners—at least in the established antitrust regimes, particularly the United States and Europe—tend to assume that the foundational legal instruments creating antitrust law are sufficiently open-textured and subject to interpretation to accommodate a variety of different and sometimes conflicting normative objectives. Hence, the existential purposes of antitrust law are open for continued creation and recreation by litigants, scholars, judges, and government officials. Further, whoever have been the actual beneficiaries of antitrust law in the past, most antitrust practitioners assume that the proper beneficiaries can be reached if the right substantive norms, procedural rules, and institutional constraints are enacted. Thus, objections based on the past record of antitrust enforcement have largely fallen on deaf ears.

---it doesn’t discriminate between individuals and primary goal is to stop suffering

---A2: Util = All lives matter---wrong, it makes BLM easier to understand and fight for because black people are disproportionately targeted

2. WHY AGAINST INTELLECTUAL MONOPOLY IS AN UNFINISHED CASE Boldrin and Levine recognize that evaluating the comparative explanatory power of existing models of patents and innovation – including those that demonstrate net benefits from patents and those that emphasize the net costs – becomes a largely empirical question. They provide historical and contemporary examples of innovation in the absence of patents to illustrate that patents are not performing the innovation-increasing functions attributed by dominant theories, and they document situations in which patents appear to have increased costs and/or dampened innovation to show the potential negative effects of the patent system on innovation. They highlight the continuing lack of empirical evidence, despite decades of research, to demonstrate that the patent system has increased innovation, and reference empirical evidence pointing in the other direction. Their empirical case, which combines historical anecdotes with references to empirical studies and descriptions of current industry experiences, successfully illustrates the weakness of the traditional justifications for patents. But after reading their arguments we cannot help but wonder if the costs and benefits of the patent system articulated by Boldrin and Levine and supported by the body 1 The thought that NIE has a role to play in understanding patent law is not new, although existing work stops short of recommending the mainstream methodological change that I propose. Important contributions at the intersection of NIE and patents include, without limitation: Kieff (2006); Heald (2007); Merges (2000); Barnett (2008); Burk (2004); and Lemley (2004). Responding to “Against Intellectual Monopoly” / 1117 DOI: 10.2202/1555-5879.1431 of theoretical and empirical work they draw from have been adequately understood, captured, measured, and compared. Still missing is a deeper theorizing of the existing empirical data and the models underlying it to explain what the current data does and does not tell us about patents and innovation and a way of addressing the limitations of the existing literature through alternative modes of analysis. The book and the literature it surveys do not sufficiently explore how patents operate to shape human activities within the context of diverse processes of invention, innovation, technology transfer and commercialization. We are also left to wonder about the range of consequences, and in particular the costs, of the radical changes in the institutional environment, that Boldrin and Levine propose. In light of the unanswered critical questions about the mechanisms by which patents might influence innovation, Against Intellectual Monopoly (as well as the literature it surveys) fails to foreclose the possibility that patents may indeed play valuable roles in achieving innovation outcomes within our existing economic system – roles not readily replaced by alternative market and non-market solutions.

2.1. COMMON ROOTS OF THE DOMINANT APPROACHES TO PATENT LAW Modern patent scholarship provides a number of competing views of how patents impact innovation, the majority of which fall into one of two camps – those following Arrow’s original focus on the tradeoff between incentives and the cost of the monopoly power used to enhance incentives (the reward-based function of patents), and those following in the wake of Kitch’s prospect theory with its focus on the role of control as facilitating downstream investment and the coordination of activities needed in developing the invention (the prospect function of patents).2 Despite the diversity of views, the majority of approaches share common roots in a neoclassical economics foundation based on models of rational decision makers, decentralized private markets and competition. The common starting point for analysis is one that largely abstracts from the context of the innovation process and from the complexity of the institutional and organizational environment to isolate the tradeoffs between enhancing incentives (both directly and indirectly through control over downstream investments) and reducing competition. The most prevalent models of patents and innovation, built largely around a reward-based theory of patents, either involve or presume an inventor who is a rational decision maker and responds to the expectation of profit when deciding where to invest his or her effort, effort which is generally treated as fungible between alternative activities. Although the outcome of effort may be uncertain, the inventor can place an expected value on the returns available from alternative investments of effort (and other resources), and directs his or her effort to activities with the highest expected payoff. The fruits of this effort take the form of an invention that is often construed as an invention-product, although this can be expanded to include a claim over multiple inventionproducts or narrowed to include incremental improvements on existing invention-products) and evaluated in terms of potential market value. The focus of analysis typically centers on questions of whether monopoly is needed to solve an appropriability problem (and potentially a disclosure problem), whether at the point of invention (the reward-theory function) or in the subsequent path of development and commercialization (the prospect function) in a simplified and relatively homogenous market paradigm. While prospect-based theories seek to refocus on a broader market environment and the role that defining property rights over the invention plays in incentivizing commercialization, the underlying models of how patents impact innovation share many of the underlying assumptions of the reward-based theories and involve a similar level of abstraction from the nature and characteristics of different processes of discovery and innovation. Similarly, while the basic model has also been expanded to distinguish between the incentive effects of patents on initial inventions and on improvements or incremental inventions, the underlying models pay little attention to specific types of transactions and the specific features of markets and technology and human decision making which shape the innovation process (see Scotchmer, 1991). By abstracting from the institutional framework that governs market activities and structures competition, and by focusing on an abstract market for “inventions” and the role of patents as interventions in these markets, we are led to a view of the patent system as a departure from the broader competitive economy rather than as a part of it (see Liivak, 2009). Moreover, we are led to a study of the patent system that is largely isolated from, rather than embedded within, systems of innovation. The result is an approach to the study of patents and innovation that lacks explanatory power for many types of innovation processes and innovation outcomes. The limits of this underlying paradigm are most evident when applied to study innovation processes that fall outside of product-focused innovation by sellers intended for and motivated by reasonably predicable commercial market opportunities. Examples include open collaboration models and use innovation models of innovation.3 These models of innovation “contrast sharply with the seller innovator picture which dominates patent policy. In that picture, incentives for inventing, disclosing, and disseminating new technologies arise from the potential for recouping innovation investments through commercial sales” (Strandburg, 2008:471). These incentives are largely missing from certain models of collaborative discovery and development that have emerged, either around a shared project or through interest in modifying product or process use to suit user needs, calling into question the traditional roles (and justifications) for patents in facilitating innovation.

Many academic studies of the patent system focus on the negative, extrapolating from anecdotes about a few bad actors to make the case that our patent system is broken and to bolster cries for legislation weakening patent rights. Precious few studies focus on the countless honest and hardworking patent owners whose inventive labors benefit us all. But understanding how patents support inventive enterprises is a crucial part of the equation, especially at a time when Congress is considering legislation that would make it extremely difficult for startups and individual inventors to enforce their patent rights.

In a newly-published working paper, The Bright Side of Patents, CPIP Edison Fellow Deepak Hegde, along with co-authors Joan Farre-Mensa and Alexander Ljungqvist, take a look how patents help startups grow. They show that, contrary to the claims made by several academics and activists, startups are not victims of the patent system. On the contrary, patents help startups become more successful and innovative.

Technological innovation is widely recognized as a key determinant of economic and public health progress. 1,2 Patents and other forms of intellectual property protection are generally thought to play essential roles in encouraging innovation in biopharmaceuticals. This is because the process of developing a new drug and bringing it to market is long, costly, and risky, and the costs of imitation are low. After a new drug has been approved and is being marketed, its patents protect it from competition from chemically identical entrants (or entrants infringing on other patents) for a period of time. For firms to have an incentive to continue to invest in innovative development efforts, they must have an expectation that they can charge enough during this period to recoup costs and make a profit. After a drug’s patent or patents expire, generic rivals can enter the market at greatly reduced development cost and prices, providing added consumer benefit but eroding the innovator drug company’s revenues.

The Drug Price Competition and Patent Term Restoration Act of 1984 (commonly known as the Hatch-Waxman Act) was designed to balance innovation incentives and generic price competition for new drugs (generally small-molecule chemical drugs, with some large-molecule biologic exceptions) by extending the period of a drug’s marketing exclusivity while providing a regulatory framework for generic drug approval. This framework was later changed to encompass so-called biosimilars for large-molecule (biologic) drugs through the separate Biologics Price Competition and Innovation Act of 2009. Other measures have been enacted to provide research and development (R&D) incentives for antibiotics and drugs to treat orphan diseases and neglected tropical diseases.

The U.S. patent system issued its first patent on July 31, 1790, which was signed by President George Washington.1 Samuel Hopkins obtained that patent for a process of making potash, an ingredient used in fertilizer.2 The over 6 million patents issued since then have supported the market development of steamships, automobiles, electric power, electric appliances, aviation, aerospace, telecommunications, mobile communications, computers, the Internet, biotechnology, and nanotechnology. Despite these significant achievements, the U.S. patent system is facing a perfect storm of criticism from academics, politicians, judges, journalists, and industry groups, with calls for abolishing or heavily regulating patents. In this article, I suggest that the anti-patent storm in part reflects a basic misunderstanding of the purpose of the patent system. A better understanding of the contributions of patents may help calm the anti-patent storm and avoid disrupting the highly successful U.S. system of invention and innovation.

I argue in this article that patents “promote the progress of science and useful arts,” because they provide the foundation of the market for inventions.3 I develop a comprehensive economic framework for the study of patents that extends work I have done on market microstructure, the theory of the firm, invention, and innovation.4 Applying this framework, I demonstrate that patents support the market for inventions in several important ways: (1) by increasing transaction efficiencies and stimulating competition, (2) by establishing what I term “the market for innovative control” that provides incentives for efficient investment, and (3) by promoting the financing of invention and innovation.5 I show that the market foundation role of patents has important implications for antitrust and public policy toward intellectual property (IP).

In many fields of technology, there are ongoing debates about how much patents matter in encouraging innovation – or about whether patents, even if they do create the intended incentives, do considerable damage by delaying wide access to highly valued goods and services. But, until recently, there has been little debate about the role of patents in pharmaceuticals. Even the Federal Trade Commission, which over the decades has taken its charge to maintain competition very seriously, has referred to innovation in the pharmaceutical industry as “showcas[ing] the patent system’s benefits.”

The industry agrees: pharmaceutical executives rate patents as far more important to innovation than do representatives of any other tech-driven business. (Indeed, in the same surveys, software entrepreneurs report that patents create little to no incentive to innovate.)