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Chapter 9: Problem 4

If Congress reduced the period of patent protection from 20 years to 10 years, what would likely happen to the amount of private research and development?

Short Answer

Expert verified
In conclusion, reducing the period of patent protection from 20 years to 10 years would likely result in a decrease in private research and development, as the potential for a return on investment would be diminished due to the reduced incentives for taking the risk and investing in innovation.

Step by step solution

01

Understand the Import of Patent Protection

Patent protects are vital because they provide an exclusive right to an invention for a set period. This protection helps to guarantee that the creators or investors can recoup their investments and potentially make a profit. In other words, patent protection acts as an incentive for individuals or companies to invest in research and development, as there is a potential financial return on their investments.
02

Determine the Impact of Reducing Patent Protection

If the period of patent protection were reduced from 20 years to 10 years, the incentive for taking the risk of developing new products would be lessened. There will be less time for the innovators or investors to profit from their inventions. This could discourage them from allocating resources towards research and development.
03

Conclusion of the Scenario

In conclusion, if Congress reduced the period of patent protection from 20 years to 10 years, it would likely lead to a decrease in the amount of private research and development, as the potential for a return on investment would be diminished.

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Most popular questions from this chapter

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Classify the following as a government-enforced barrier to entry, a barrier to entry that is not governmentenforced, or a situation that does not involve a barrier to entry. a. A patented invention b. A popular but easily copied restaurant recipe c. An industry where economies of scale are very small compared to the size of demand in the market d. A well-established reputation for slashing prices in response to new entry e. A well-respected brand name that has been carefully built up over many years

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