Prizes can never substitute or strengthen the patent system – cost prohibitive
Philip Stevens and Stephen Ezell February 3, 2020, Stevens is executive director of the Geneva Network, which he founded in 2015. He is also a senior fellow at the Institute for Democracy and Economic Affairs, Malaysia; Ezell is ITIF vice president for Global Innovation Policy and focuses on science, technology, and innovation policy as well as international competitiveness and trade policy issues, “Delinkage Debunked: Why Replacing Patents With Prizes for Drug Development Won’t Work,” INFORMATION TECHNOLOGY AND INNOVATION FOUNDATION, accessed July 1, 2024, https://itif.org/publications/2020/02/03/delinkage-debunked-why-replacing-patents-prizes-drug-development-wont-work/
The assumption made by advocates of government-run prizes that they would have minor deadweight costs compared with the (temporary) “monopolies” created by the IP system has been called into question by many. For instance, as Daniel Spulber, Professor of International Business at the Kellogg School of Management, Northwestern University, and an award-winning expert on innovation policy, notes, “Prize advocates tend to assume that the government would expend no resources in administering the prize system, including managing contests, selecting winners, and allocating inventions.” However, as he continues, “The government could not replace the entire patent system with contests and awards in every area of science and technology covered by the patent system without incurring astronomical administrative costs.”51