Why does society allow, or even encourage, private appropriation of inventions? When do patents encourage competition, when do they hamper it? How should society design the compromise between the interest of the inventor and the interest of the users of patented inventions? How should the patent system adapt to new technological areas?
These questions and many more are addressed by the authors in this groundbreaking analysis of the economics behind the European patent system. Beginning with the history and principles of the patent system, the book then examines the economic effects of patenting on innovation and the diffusion of technology and growth. Throughout the book the theory and the reality are discussed alongside real world examples and comparison between the European, USA, and Japanese patent systems.

The development of patent markets should allow for better circulation of knowledge and more efficient allocation of technologies at a global level. However, the beneficial role of patents has recently come under scrutiny by those favouring 'open' innovation, and important questions have been asked, namely: How can we estimate the value of patents? How do we ensure matching between supply and demand for such specific goods? Can these markets be competitive? Can we create a financial market for intellectual property rights? In this edited book, a team of authors addresses these key questions to bring readers up to date with current debates about the role of patents in a global economy. They draw on recent developments in economic analysis but also ground the discussion with the basics of patent and knowledge economics. Striking a balance between institutional analysis, theory and empirical evidence, the book will appeal to a broad readership of academics, students and practitioners.

Why does society allow, or even encourage, private appropriation of inventions? When do patents encourage competition, when do they hamper it? How should society design the compromise between the interest of the inventor and the interest of the users of patented inventions? How should the patent system adapt to new technological areas?
These questions and many more are addressed by the authors in this groundbreaking analysis of the economics behind the European patent system. Beginning with the history and principles of the patent system, the book then examines the economic effects of patenting on innovation and the diffusion of technology and growth. Throughout the book the theory and the reality are discussed alongside real world examples and comparison between the European, USA, and Japanese patent systems.