An Organizational Approach to the Design of Patent Law

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2012] AN ORGANIZATIONAL APPROACH 235
cusses the political economy of the patent system and its implications
for patent reform. 104
These different approaches demonstrate the potential that
the analytical tools of NIE have to shed light on new aspects of
patent law, but the literature lacks a foundation that can connect
specific empirical studies and the insights of theoretical
models to each other and to more comprehensive models of innovation.
105 The absence of such a foundation has limited the
reach of NIE to influence patent policy. A key objective in developing
a methodology and framework for thinking about patents
and the organization of innovation is to promote the integration
of existing results and the connection of these results
with both the real life systems within which different kinds of
innovation take place and the legislative, administrative, and
judicial systems that determine the directions of patent law.
Applying the insights from this literature to inform patent policy,
the central inquiry for patent policymakers becomes one of
determining what roles patents play in structuring, facilitating,
or impeding desired processes of innovation. 106
100, at 1; Barnett, supra note 9, at 3; Baldwin & Hippel, supra note 100 Burk,
supra note 9, at 3; Duffy, supra note 100; Gallini & Winter, supra note 41, at
238; Heald, supra note 9, Kieff, supra note 9, at 328–30; Lemley, supra note
100, Long, supra note 100; Merges, Intellectual Property Rights and the New
Institutional Economics, supra note 9; Merges, Expanding Boundaries of the
Law: Intellectual Property and the Cost of Commercial Exchange, supra note
41, at 1590–91.
104. See, e.g., Kesan & Gallo, supra note 7 (advocating for an analysis of
the patent system’s political economy in order to fully understand patent reform);
Arti K. Rai, Engaging Facts and Policy: A Multi-Institutional Approach
to Patent System Reform, 103 COLUMBIA L. REV. 1035, 1035 (2003) (exploring
the importance of institutional design for patent policy).
105. See W. Patrick McCray, Re-Thinking Innovation: A New Agenda for
Academic Investigation, SCI. PROGRESS (May 14, 2010),
http://www.scienceprogress.org/2010/05/re-thinking-innovation (discussing the
disconnected analysis of innovation and the need for a middle ground that
makes extrapolation to real world innovation possible).
106. For examples of efforts made in this direction see Brett Frischmann,
Spillovers Theory and Its Conceptual Boundaries, 51 WM. & MARY L. REV. 801
(2009–2010) (arguing that regulating the effects of the externalities-producing
patent system requires an understanding of the varied institutions in which
patents operate); see also Brett Frischmann, The Pull of Patents, 77 FORDHAM
L. REV. 2143 (2008–2009) (explaining that changes in patent law are shifting
the university research system to a more commercial orientation); Arti K. Rai,
The Information Revolution Reaches Pharmaceuticals: Balancing Innovation,
Incentives, Cost, and Access in the Post Genomics Era, 2001 U. ILL. L. REV.
173, 180 (2001) (arguing that genomic advances could reduce drug development
costs enough to scale back pharmaceutical patent protection); Barnett,
Intellectual Property as a Law of Organization, supra note 9, at 3–4 (arguing