Right now, senators, inventors, and tech companies are squabbling about how to reform the patent system to encourage more innovation. Some version of the embattled patent-reform legislation is expected to pass next month, and stakeholders are preparing for a gory fight over all sorts of itty-bitty nitty-gritties, such as how to calculate damages for patent infringement.
Meanwhile, some scholars and politicians are proposing something far more radical: They want to junk, rather than just rejigger, the patent system. Instead of handing out patent monopolies, they say, the government should offer cash prizes for inventions. In an ideal world, this would lead to cheaper products and motivate more research and development in fields that are unprofitable but socially valuable—such as new treatments for diseases that affect poor people. This solution may seem extreme, but targeting certain elements of the idea to particular inventions would be both politically feasible and entrepreneurially effective.