“Negative externalities” may seem like an abstract economic concept, but the impact are real harms caused by patented inventions.

The stakes of addressing the negative externalities of innovation are enormous. Undergirding the seemingly abstract concept of externalities are real harms caused by patented inventions. Technologies that the patent system actively subsidizes are degrading political discourse, eliminating jobs, and likely contributing constitutional violations. Patents and market-based systems of technological development enjoy a presumption of efficiency in the allocation of resources for innovation. However, markets are unlikely to allocate resources efficiently if they ignore wide swaths of external costs. This Article highlights the underappreciated reality that patented technologies generate uncompensated third-party harms; attention to externalities (both positive and negative) will lead to more enlightened innovation policy and more efficient resource allocation.