Are patents good or bad for Economics - Term Paper Example

‘Patent’ is the rights approved by the government that is bestowed to the inventor or patentee for special use of the invention for a restricted time period in the country or region, subjected to the prevailing law of that country or region. The duration for protection is generally 14 to 20 years including possible extension of 7 years (Bardowell, “Patent System”). The policy of patenting is an important part of the economy as it helps in the process of innovation and invention to the country.

The paper aims to substantiate the importance of patents for an economy. For the society, the benefits are achieved when the invention moves into the public realm after a certain period of time after the invention. Also the invention is revealed to the society with the expectation that there will be improvement in the invention. The patentee holds no such intention of keeping it as a trade secret. The granting of patent may sometimes become risky for the government. The term for which duration of patents are restricted (20 years) is very elongated.

For such approach, innovation or improvement on the invention might get hold for a long period of time. But granting patents always keep the government on the safe side with because they can control the innovation and invention, be it good or bad. The historical data shows that patents have always produced good results for the economy. In this section of the paper, an article from the magazine “The Economist” has been cited and analyzed. The article named ‘The good, the bad and the ugly’ has explained the traits of urge towards innovation in Britain.

The objective of the article was to rate Britain as a knowledge based powerhouse among the world countries. The article establishes that for upgrading the economic growth, governments provide good reason to promote innovation. As patent is the heart of invention through innovation in the field of R&D, governments take initiatives in