On Copyright and Patent Protection for Software and Databases: A Tale of Two Worlds

Abstract

Several recent evolutions in intellectual property policy have occurred that have raised policy concerns for the conduct of basic scientific research. These are the (possibly) increasing commercialization of the university following Bayh-Dole, the European database directive, which increased the level of IP protection on databases considerably, and the rise in the patenting of software and business methods. This paper considers the impact of increased copyright and patent protection for software and databases (that is, for “pure” information goods) on scientific research communities. The central issue discussed is the tension between the two worlds of commercial innovation and scientific research with respect to the twin goals of appropriating and diffusing knowledge. These two worlds have developed very different incentive systems for rewarding the production of information, and problems develop when the two worlds move closer together, as they have recently in much of the world. Examples of this tension from university patenting in the United States and from increases in database protection are given. The paper argues that a useful distinction between the necessary incentives for the production of pure information goods (which require little complementary investment to make them useful) and industrial innovations (which require a great deal) might lead to a lesser need for intellectual property protection in the former case.