The blog of a North Country Swede!

Sunday, October 12, 2008

On patents and the role of good government in markets

I am always somewhat amused when folks talk about "the government" as something outside ourselves. I view "government" as a way of our ordering the overarching collective -- the "state" -- of which we are members. Wasn't it a Republican president -- Abraham Lincoln -- who penned and then spoke the words "... "this nation, under God, shall have a new birth of freedom--and that government of the people, by the people, for the people, shall not perish from the earth"?

Let's take an economic example, the issuing of patents ... and explore the idea a wee bit.

Market concepts inform us that unless society develops some way to reward new ideas, there isn't much incentive to come up with them ... because -- as in the case of the wheel AND the printing press -- as soon as it is invented, the item can be replicated by anyone with the ability to do so ... and that level of ability was not a very high hurdle in the scheme of human ability.

History tells us that after the creation of government -enforced patent rights in Western Europe in the 18th century, economic growth based on new technologies took off.

The problem fallible humans face is that "more" government regulation is not synonymous with "better" government regulation. So how do we improve government? Certainly we now know that we shouldn't let anti-government ideologues of limited intelligence appoint "Heckuva Job Brownie" to head FEMA ... don't we?

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