QDoes it fits in a free market economy that seeds of major food crops can be patented and cause a monopoly situation?

Does it fits in a free market economy that seeds of major food crops can be patented and cause a monopoly situation?

AExpert Answer

Whether patents, or other intellectual property (e.g. copyrights), that create a monopoly in the invented item fits within a free market economy is a debate in which political economists have been engaged for a long time.  The Founders of the United States engaged in this debate too with some opposed to allowing a monopoly in anything and others, on utilitarian grounds, supporting the creating of a monopoly through intellectual property rights.  Ultimately the Founders decided in favor of intellectual property rights and adopted into the United States Constitution the following provision:

 

Article 1, Section 8, Clause 8, Patents and Copyrights.

 

“To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries.”

 

The United States Constitution explicitly recognizes a monopoly – “ ... securing for limited Times to ... Inventors the exclusive Right to their respective Writing and Discoveries.”  Regarding patents, the limited time for that exclusive right is twenty years.

 

Thomas Jefferson, who was not present at the Constitutional Convention in 1787, initially opposed this provision on patents and copyrights.  But in the early 1790s Jefferson changed his mind as the history of U.S. patents shows.  Indeed, Thomas Jefferson became the first commissioner of patents and drafted the first laws about patents and the U.S. patent office.

 

What convinced the Founders to adopt a patent provision that allows a limited time monopoly?

 

The answer appears to be an intuition that limited time monopoly through patent rights spurs inventiveness and creativity.  These Founders wanted the citizens of the United States to be inventors and creators of new knowledge and technology.  These Founders decided that by offering a limited time exclusive right (a monopoly) the United States government would be providing an incentive to its citizens to spend the time, money, and effort to invent and create.  During the monopoly period, these citizens, including legal entities such as corporations, would be able to recover their investment and make a profit.  Once the limited time ends, these inventors and creators then would face the competition of the free market.One addition to the information in the preceding paragraph must be made and emphasized.  An inventor cannot gain the patent monopoly without disclosing information about the invention and describing it sufficiently so that others skilled in the same subject matter are able to learn from and duplicate the invention.  In other words, the United States grants an inventor an incentive to invent but only so long as that inventor also expands the common knowledge and technical skills of everyone.

 

Yes, for the period of twenty years, the inventor has an exclusive right to “their respective” invention.  During that period, others must seek a license (permission) from the inventor to use, make, sale, export, etc. the invention.  In the licensing of the invention, the free market has significant impact in setting the terms of the license.What has been described in this answer is called the “patent bargain” – the utilitarian explanation of why the Founders decided to allow a limited time monopoly within our free market system.

 

The debate about the Founders decision to protect intellectual property rights has continued since the United States came into being in 1789.  During some historical periods, Americans have favored intellectual property rights strongly; during other historical periods, Americans have disfavored intellectual property rights.  But at no time in American history has there been a serious attempt to amend or to repeal Article 1, Section 8, Clause 8.

 

American society has consistently affirmed the Founder’s intuition (the patent bargain) as expressed in the constitutional provision on patents and copyrights.  As a consequence, America has been at the forefront of invention and creation from 1789 until today.

 

For a fuller explanation of the history of the Patents and Copyrights clause and discussion of the patent bargain, you may view a video (18 minutes) made in January 2013 by the author of this answer for the Institute of American Constitutional Heritage of the University of Oklahoma.  http://freedom.ou.edu/freedom-101-2-ep-9-intellectual-property-freedom/ 

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