s. The first of these discussions considers the role of patent law in relation to technological innovation, while the second discussion reviews the differences between American patent law and the patent law of other countries.
Technology is one of the means by which productivity may be increased within an economy, an industry, or a firm. The introduction of new technology tends to lower production costs over the long term. Technology, thus, is indispensable with respect to economic growth. With respect to natural resource requirements, it is said that society is engaged in a race between technology and the exponentially rising demand for raw materials. With respect to most firms, an essential resource is human capital. Advances in technology enable firms to utilize available human capital in more productive ways. Computer technology, in the last quarter of the twentieth century, is one form of technological innovation that is performing this role in firms of all sizes. Technology is, in effect, assisting these firms to eliminate limits to their growth.
New technologies, such as computer technology, motivate autonomous investment on the part of individual firms. The autonomous investment decisions made by firms are made with an expectation of profit improvements that will result from the application of technological advances.
Patent law is the primary means by which the developers of technological innovation may protect their intellectual property as a means of profiting from such development (Slind Flor, 1992b, p. 1). The patent system, thus, may "be viewed as a method of assigning property rights to innovators in order to encourage research and development" (Chou and Shy, 1991, p. 811).
The American patent system is based on the Constitution of the United States of America. Article 1, Section 8 of the Constitution grants to the Congress the power "to promote the progress of science and useful arts be securing for...