Patents generate more deadweight losses than taxes
Anthony E. Chavez, 2021 - Professor of Law, Chase College of Law, Northern Kentucky University “Turning Carbon Into Gold: Incentivizing The New Alchemy” 32 Duke Envtl. L. & Pol'y F. 1 *, Nexis Uni, Accessed via University of Michigan //DH
Unique pricing and efficiency issues arise with government prizes. Although a primary argument in favor of prizes
over patents is the avoidance of intellectual property's deadweight loss, the overall reduction of deadweight loss
may not be as large as the elimination of monopoly pricing might suggest. 289Moreover, governments
typically fund their prizes through taxes, which can have their own deadweight effects. 290 In general,
however, economists estimate the deadweight [*34] loss from monopoly pricing to be worse. 291