The Patent-Competition Interface in Developing Countries

Abstract

This book proposes an approach to the patent-competition interface for developing countries. It puts forward a theoretical framework after canvassing relevant policy considerations and examines the many reasons why patent protection is not essential for generating innovation incentives in developing countries. These include the tendency of the patent system to overcompensate innovators, the availability of other appropriation mechanisms for innovators to monetize their innovations, and the lack of appropriate technological capacity in many developing countries to take advantage of the incentives generated by the patent system. It also argues that developing countries with a small population need not pay heed to the impact of their patent system on the incentives of foreign innovators. It then proposes a classification of developing countries into production countries, technology adaptation countries, and proto-innovation countries and argues that dynamic efficiency considerations take on different meanings for developing countries depending on their technological capacities.