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Promoting innovation

Innovation takes time and resources to achieve. Suppose a company invests in research and development and finds the cure for the common cold. In this world of near ubiquitous information, other companies could take the formula, produce the drug, and because they did not incur the costs of research and development (R&D), undercut the price of the company that discovered the drug. Given this possibility, many firms would choose not to invest in research and development, and as a result, the world would have less innovation. To prevent this from happening, the Constitution of the United States specifies in Article I, Section 8: “The Congress shall have Power . . . To Promote the Progress of Science and Useful Arts, by securing for limited Times to Authors and Inventors the Exclusive Right to their Writings and Discoveries.” Congress used this power to create the U.S. Patent and Trademark Office, as well as the U.S. Copyright Office. A patent    gives the inventor the exclusive legal right to make, use, or sell the invention for a limited time; in the United States, exclusive patent rights last for 20 years. The idea is to provide limited monopoly power so that innovative firms can recoup their investment in R&D, but then to allow other firms to produce the product more cheaply once the patent expires.

A trademark    is an identifying symbol or name for a particular good, like Chiquita bananas, Chevrolet cars, or the Nike “swoosh” that appears on shoes and athletic gear. Roughly 1.9 million trademarks are registered with the U.S. government. A firm can renew a trademark over and over again, as long as it remains in active use.

A copyright    , according to the U.S. Copyright Office, “is a form of protection provided by the laws of the United States for ‘original works of authorship’ including literary, dramatic, musical, architectural, cartographic, choreographic, pantomimic, pictorial, graphic, sculptural, and audiovisual creations.” No one can reproduce, display, or perform a copyrighted work without permission of the author. Copyright protection ordinarily lasts for the life of the author plus 70 years.

Roughly speaking, patent law covers inventions and copyright protects books, songs, and art. But in certain areas, like the invention of new software, it has been unclear whether patent or copyright protection should apply. There is also a body of law known as trade secrets    . Even if a company does not have a patent on an invention, competing firms are not allowed to steal their secrets. One famous trade secret is the formula for Coca-Cola, which is not protected under copyright or patent law, but is simply kept secret by the company.

Taken together, this combination of patents, trademarks, copyrights, and trade secret law is called intellectual property    , because it implies ownership over an idea, concept, or image, not a physical piece of property like a house or a car. Countries around the world have enacted laws to protect intellectual property, although the time periods and exact provisions of such laws vary across countries. There are ongoing negotiations, both through the World Intellectual Property Organization (WIPO) and through international treaties, to bring greater harmony to the intellectual property laws of different countries to determine the extent to which patents and copyrights in one country will be respected in other countries.

Questions & Answers

Evaluate the impact of corona virus on the economy of china
Kelvin Reply
lose of global market unemployment Expenses low export
Bangi
The similarities and difference between the definition of prof Lionel Robbins and prof Paul ; A; Samuel son, each 5 definition
prince Reply
What are the basic concepts of economic
Taye Reply
With the aid of appropriate diagram differentiate between change in demand
Jones Reply
explain demand
Alaka Reply
Demand is a quantity of goods and services a consumer is willing to buy at given price in a period of time.
Aliado
who break in bulk
Alaka
what is demands and it law
matthew Reply
Demands, is the quantity of agoods a consumer is willing to buy at given price in a give period of time where as the law of demand states that, the higher the price, the lower the quantity demanded and the lower the price, the higher the quantity demanded by consumers
Aliado
what is division of labour
Sunday Reply
The similarities and difference between the definition of prof Lionel Robbins and prof Paul ; A; Samuel son, each 5 definition
prince
Demand is set to be enlastic when its what
bohvy Reply
more than boll had him had bhaag......
SHADAB
Cant you speak in English
john
a little
Tith
I do speak English.. the question is Demand is set to be elasticity went the dash *2
bohvy
if I want some document from,that 9k?
Tith
hi
muhammed
if both %^ Increase in input & %^ increase in output, then it is elastic and = to 1.
Rowda
Allah's Allah's last I'll be in the area around.....
SHADAB
Hy guyz
Vuyai
Hi
john
How are you all doing rumies
john
why is scarcity a fundamental problem in economic
Abubakar Reply
what is demand curve
Takyi Reply
xplain
Ubong
thanks for your help with the same....
SHADAB
What is elasticity of demand
Karim
what is unemployment
Alaka
what is opportunity cost
Samuel Reply
Opportunity cost which also mean real cost it is a term used for foregone alternatives
john
what is demand
ikea Reply
Demand may simply be define as the total quantity of good or service a consumer are willing to buy at a specific price within a period of time.
john
your language is tough
techy Reply
How economics is related to other subjects?
Mikateko Reply
It is social science related subjects
john
How ? explain
Mikateko
and something else help me about business cycle
Mikateko
s classified as a social science. This view makes eco­nomics an academic relative of political science, sociology, psychology and anthropology. All of these disciplines study the behaviour of human beings individually and in groups.
john
The business cycle describes the rise and fall in production output of goods and services in an economy. Business cycles are generally measured using the rise and fall in the real gross domestic product (GDP) or the GDP.
john
hello everyone
Selena
hii
Yes
hello selena
Yes
How are you doing every one
john
hello Selena
Yes
hi
NONSO
yes
NONSO
What Is Economic Growth?
Saviour Reply
is the increase of quantity of goods ans services
Hashi
what are the examples of price elasticity of supply
violet Reply

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Source:  OpenStax, Principles of economics. OpenStax CNX. Sep 19, 2014 Download for free at http://legacy.cnx.org/content/col11613/1.11
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