Economic Incentives in Markets for Information and Innovation
![handle is hein.journals/hjlpp13 and id is 883 raw text is: ECONOMIC INCENTIVES IN MARKETS FOR
INFORMATION AND INNOVATION
EjAN MAcKAAY*
And when we turn to such problems of... inventions or of
literary or artistic creations, nothing short of going back to
[the] rationale of property will help us decide what should be
in the particular instance the sphere of control or responsi-
bility of the individual.
- Hayek'
[I]n the current state of knowledge, economists know almost
nothing about the effect on social welfare of the patent sys-
tem or of other systems of intellectual property.
- Priest?
I. INTRODUCTION
Scholars generally think of intellectual property rights, as in-
centives to produce and trade innovative ideas. Current wis-
dom, embodied for instance in the Encyckipaedia Britannica,
ranks them among property rights in general, as indeed their
title suggests. The idea of ranking intellectual rights as prop-
erty goes back to the French Revolution. In replacing a system
of privileges granted in the discretion of the authorities with
non-discretionary rights to exploit inventions or literary cre-
ations, the proponents of the new legislation of the time in-
sisted that:
of all forms of property, the least susceptible of being con-
tested is without question that of the works of a man of tal-
ent or genius; something must astound us: it is that an Act
has been necessary to recognize this property and to ensure
* Professor of Law, University of Montreal. LL.M., 1966, LL.D., 1980, University of
Amsterdam; LL.M., University of Toronto, 1977. I am much indebted to Bertrand
Lemennicier, Henri Lepage, and Tom Palmer for discussions on the subject matter of
this Article and to Reuven Brenner for comments on a draft of it; to participants in the
Liberty Fund Symposium on Intellectual Property Rights and the Market System; and
to the Centre de recherche en droit public, where the original paper was written, for
providing a stimulating environment.
1. Hayek, Individualism: True and False, in INDMDUALISM AND ECONOMIC ORDER 21
(H. Cy ed. 1972).
2. Priest, What Economists can Tell Lawyers about Intellectual Property, in 8 RESEARCH IN
LAW AND ECONOMICS: THE EcoNoMIcs OF PATENTS AND CoPYRIorrs 21 (J. Palmer ed.
1986).](ViewImageLocal?handle=hein.journals/hjlpp13&div=51&collection=&method=preview&ext=.png&size=3)
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Economic Incentives in Markets for Information and Innovation
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