Economic analysis of Intellectual Property Rights

A new tablet for a serious disease may take years and a huge amount of money to develop. Once it exists, a rival can copy the formula for the price of the raw material. If copying is free, who will pay for the next discovery? If copying is banned for too long, the patient who cannot afford the price pays instead. Economics is the tool lawyers use to weigh these two dangers, and intellectual property law is one long argument about where to draw the line.

In two minutes

The economic case for intellectual property is that information is cheap to copy and costly to create, so the law grants temporary exclusive rights as an incentive; the economic case against is that such rights create monopoly prices, transaction costs and barriers to follow-on creation, so the law limits their scope and duration.

The rest of this chapter

The full explanation, the cheat sheet, every previous-year question at every mark weight, the quiz and the answer skeletons are part of Intellectual Property Laws on LexBlox Semester. Sign in to unlock the subject, or read Module 1 of Legal Language and Writing free.