New innovation research (and patent reform)

NBER held its annual Innovation Policy and the Economy session in Washington last week with a number of interesting papers (available on their website):

Wes Cohen and John Walsh on Real Impediments to Academic Biomedical Research;
Robert Litan, Lesa Mitchell and E.J. Reedy on Commercializing University Innovations: A Better Way (looking at alternative technology transfer mechanisms);
Shane Greenstein on Economic Experiments and Industry Know-How in Internet Access Markets;
Carl Shapiro on Patent Reform: Aligning Reward and Contribution;
Jean Tirole and Joshua Lerner on Public Policy toward Patent Pools.

I was especially interested in Shapiro’s conclusion that a stronger patent law is not always a good thing. Rather, what is needed is a stronger procedure for ensuring that the rights of all parties are protected. As he sums up:

Introducing an independent invention defense in patent infringement cases would predictably reduce excessive rewards. Strengthening the procedures by which patents are re-examined after they are issued would have a similar effect in aligning rewards and incentives, especially for patents licensed to multiple competing firms. Several other proposed reforms relating to patent infringement litigation also look promising using the reward/contribution framework: limiting the use of injunctions, clarifying the way in which damages based on “reasonable royalties” are defined, and narrowing the doctrine of willful infringement. Recent empirical work suggests that all of these reforms would affect important, real-world situations that frequently arise. The economic reasoning supplied here suggests that these reforms would enhance economic efficiency and promote innovation.

Many of these are to be found in proposed patent reform legislation. That legislation, however, seems to be stalled in Congress similar to what happened last Congress. Let’s hope that research work like Shapiro’s can help break the logjam. But, I doubt it. The issue appears to be interest group politics -- and that is rarely influenced by research findings.