CP solves - Replacing patents with prizes solves the case.
Baker et al. 17’ – Dean, Co-founded CEPR, the Center for Economic and Policy Research, in 1999. His areas of research include Housing, Macroeconomics, Intellectual Property, Social Security, Medicare and European labour markets. Arjun Jayadev, Joseph Stiglitz, “Innovation, Intellectual Property, and Development: A BETTER SET OF APPROACHES FOR THE 21st CENTURY”, AccessIBSA, https://academiccommons.columbia.edu/doi/10.7916/d8-xg80-ct59, xx-xx-2017
There are actually a variety of alternative ways of financing and incentivising research, within the current dispensation, many of which are in use today in different countries and contexts.
For simplicity, these approaches can be categorised as:
1. Direct financing through centralised mechanisms – where a government agency directly finances research and/or creative work. The National Institutes of Health and the National Science Foundation in the United States are examples of centralised direct support for research. Many countries have some form of arts or culture council that supports creative work of various types.
2. Decentralised direct funding mechanisms – where research and/or creative work is directly supported and/or incentivised through a decentralised mechanism. A tax credit for research and development is one mechanism in this category; a tax credit means that the government is effectively paying part of the research costs. Another example is the tax deduction for charitable contributions for universities and other institutions to support research or creative activities in the United States. In this case, the government is effectively subsidising the spending of private individuals.14 Another example is the tax deduction for charitable contributions for universities and other institutions to support research or creative activities in the United States. In this case, the government is effectively subsidizing the spending of private individuals.
Neither of these systems requires patent or copyright monopolies, since the work is paid for upfront. On the other hand, we can have systems that finance research and creative work through ‘market based’ mechanisms, as described below.
3. Prize financing system – this is a system where a governmental body or a private foundation/research institution awards a prize for a successful innovation (or other creative activity). There have been some famous historical examples of prize systems, most notably the prize posted by the British government in 1714 for a method to accurately measure longitude, and another posted by the Royal Society for Arts and Technology for a mechanical solution to replace chimney sweeps. While prize systems are not currently in widespread use by governments, there are many prizes being privately offered. In recent years, there have been proposals in the US to provide prizes for drugs research (as proposed by Senator Sanders15) and for the development of renewable energy.
The patent, of course, is a prize (see below). Here, however, it is as if the government (or other party offering the prize) buys the patent, based on an assessment of its value, and then places it in the public domain so that its benefits could be realised as fully as possible, since it would be available at a relatively low licensing fee.