'Inventiveness is good. It should be rewarded. Monopoly
power, by contrast, is bad. It should be discouraged. So what does
the patent system do? It rewards inventiveness with a licence to
monopolize. That's nuts.'
So says maverick economist, Steven E Landsburg, in More Sex is
Safer Sex (yes it's an economics book!) But mainstream
economists have no such difficulties with IP – see the
current discussion on the IP blogsite ipkittenblogspot.com. So what
exactly is the economic justification for IP? IP creates
monopolies. Yet economists are untroubled by this, certainly when
it comes to patents and copyright. There are various theories.
There's the awfully-named 'Labour-Deserve' theory,
which says you're entitled to be rewarded for your efforts
(deep stuff!). There's the 'Social Contract' theory,
which recognises that society must offer incentives to innovate,
and that it must be prepared to offer inventors and creatives a
limited monopoly in return for the benefits that we get from their
efforts, be it a new medicine or a great book. And then there's
the theory that must have been named by bean counters, the
'Cost/ Benefit' theory – this says that, although
there may be a cost in having to pay inflated prices for a period,
the benefit of the use of the invention or creation (which, of
course, eventually falls into the public domain) outweighs that
But what of trade marks? Where's the labour? The innovation?
What about Cost/Benefit? Is there a social benefit, something that
goes beyond the benefit that the trade mark owner gets from the
(potentially permanent) exclusive use of a name? Indeed, argue some
who specialise in the dismal science, the benefit to society lies
in the information that's conveyed by the mark – a trade
mark gives you information about the product and distinguishes it
from the competition, saving you (the consumer) from having to do
research (true, if you want a rubbish eating experience, the
McDonalds trade mark saves you the bother of having to make
enquiries about where this is to be found!) Trade marks also fulfil
a social function, in that we can infer things about a person from
the brands they use (true, you see someone with a Beemer or a
Breitling and you're immediately thinking: 'What a
....!'). As for the cost, we're told that this is limited
to the negligible cost of running an IP registration system. Mmmm!
The theory's a little less convincing with trade marks than it
is with patents and copyright. Which may just be why some people
query whether trade marks are really intellectual property.
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It has always been the practice of the Industrial Property Institute of Mozambique to prohibit the refiling of trade marks that have been finally refused, which has posed a serious obstacle to trade mark applicants...
A recent Australian decision on keyword usage of a registered trade mark is in line with decisions in many other countries, including South Africa.
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