Kitch's Prospect Theory of Patent There are two reasons to give a prospector rights to what he finds One is to reward him,give him an incentive to find it The other is to create a property right that can be used to better develop what he finds Consider the common pool problem applied to gold or silver mining The ore doesn't flow like oil or gas But knowing where you have found it tells me where to dig-next to your hole Which not only reduces your incentive but wastes resources Edmund Kitch argued that the same applied to patents An invention requires further development,other inventions The patent holder has the incentive and ability to coordinate that process Just as homesteading turns public land into private property Making it possible to invest in improving it ·Coordinate uses of it Patents viewed as homesteading idea spaceKitch’s Prospect Theory of Patent • There are two reasons to give a prospector rights to what he finds • One is to reward him, give him an incentive to find it • The other is to create a property right that can be used to better develop what he finds • Consider the common pool problem applied to gold or silver mining • The ore doesn’t flow like oil or gas • But knowing where you have found it tells me where to dig—next to your hole • Which not only reduces your incentive but wastes resources • Edmund Kitch argued that the same applied to patents • An invention requires further development, other inventions • The patent holder has the incentive and ability to coordinate that process • Just as homesteading turns public land into private property • Making it possible to invest in improving it • Coordinate uses of it • Patents viewed as homesteading idea space