Title

The Pull of Patents

Abstract

The conventional view of the role of patents in the university research context (and more generally) is that patent-enabled exclusivity improves the supply-side functioning of markets for university research results (and inventions more generally) as well as those markets further downstream for derivative commercial end-products. The reward, prospect, and commercialization theories of patent law take patent-enabled exclusivity as the relevant means for fixing a supply-side problem—the undersupply of private investment in the production of patentable subject matter or in the development and commercialization of patentable subject matter that would occur in the absence of patent-enabled exclusivity. Put another way, patents attract private investment to productive activities that might otherwise be less attractive investments. The reason why is rather straightforward and well-understood. Without patents, the fruits of the investments, intellectual fruit, would be too easily accessed and used by others without compensation to the original investor, thus undermining the incentive to invest in the first place. This is the standard public goods story that serves as the textbook explanation for why we have a patent system.

While the supply-side view of the role of patents is important, a view from the demand-side is needed to fully appreciate the role of patents in the university research context (and more generally) and to fully inform university decisions about the extent to and manner in which they participate in patenting and commercializing research. Introducing patents into the university research system, along with a host of other initiatives aimed at tightening the relationship between universities and industry, is (primarily) aimed at increasing connectivity between university science and technology research systems and the demands of industry for both university research outputs (including research results and human capital) and upstream infrastructural capital necessary to produce such outputs.

In this essay, I explore how university science and technology research systems perform economically as infrastructural capital and explain how these systems generate social value. I explain the dual role of patents in the university research context. On the supply side, patents facilitate the transfer (or “push”) of university research to industry. On the demand side, patents attract (or “pull”) university resources to meet industry demands. I focus on the demand side dynamic and explain how “patent pull” in the university research context may lead to a slow and subtle shift in the allocation of critical infrastructure resources within universities. I explore what this means for both universities and society, and conclude with some observations about how universities might approach these issues strategically.

Approaching the role of patents from the demand side is an entirely new enterprise, and it is critical to understanding the role of patents in the university context and more generally. Thus, in conclusion, I also make a few suggestions about future avenues of research in this area.

Disciplines

Intellectual Property | Internet Law | Law and Economics | Science and Technology

Date of this Version

September 2005