Patent regimes have been strengthened across the globe. This paper discusses the theoretical case for strong national patent regimes in the context of a globalized world. The national treatment of foreign inventors gives countries an incentive to free ride, and while this can be overcome through patent rights harmonization agreements, these present coordination challenges. In particular, while more innovative countries will benefit from harmonizing on a higher level of patent rights, less innovative countries will prefer a lower common level. These insights are applied to Canada, where both theory and empirical evidence suggest that Canada’s patent regime is doing little to promote domestic innovation, while generating significant deadweight losses for the economy. The conclusion is that Canada’s interests would best be served by a weaker national patent regime, subject to its current international obligations. Moreover, any future agreements that increase such obligations would ceteris paribus not benefit Canada.
About the Author
Joël Blit is a CIGI senior fellow researching the topic of innovation, including exploring intellectual property rights, closing Canada’s innovation gap, and the link between Canadian immigration and innovation. Joël is assistant professor of economics at the University of Waterloo, with expertise in the economics of innovation, technology clusters, intellectual property, entrepreneurship, international trade and multinational corporations.