Against Intellectual Monopoly

inconvenient." The Statute of Anne, in 1710, extended and revised the law,
while also introducing copyright. Until these formal laws were introduced, patents and copyright were nonexistent, were used as a form of governmental extortion through the sale of economic privileges, or were a tool
for harassing scientists and philosophers, as Galileo and many others across
Europe were forced to learn. Insofar as the British system of patent was
helpful in inducing the Industrial Revolution, it is likely that the limitation
it placed on the arbitrary power of government to block and monopolize
innovation was the most important factor.

    After the British legislative innovations of 1623-4 and 1710, imitation
proceeded rather slowly in the rest of Europe: for good or ill, the transmission
of ideas always takes time. A patent law was enacted in France in 1791;
because it was based on the principle that no examination of any kind was
required, it amounted to no more than a registry of inventions, often with
very many duplicates, variations, and so on. It was also quite costly to get
a patent, and the latter was declared void if the inventor tried to patent the
invention also in another country, a small detail revealing the mercantilist
foundation of "intellectual property," something that, as we argue later,
remains essential to current legislation. As a consequence of all this, the
French system did not introduce much monopoly until it was reformed in
1844.
    It is only towards the end of the nineteenth and the beginning of the
twentieth century that countries such as France, Germany, Italy, and Spain
came to adopt fairly comprehensive "intellectual property laws." By this
time, innovation, rule of law, and ownership of ideas in these countries
were widespread, and the introduction of "intellectual property" laws served
to create private monopolies rather than to limit the arbitrary power of
government. Germany enacted a comprehensive patent law, introducing
for the first time the principle of mandatory examination, only in 1877.
Still, German patent law was mostly restricted to processes, not products; in
particular, chemical products did not become patentable until much later.
A number of significant holdouts remained until around the First World
War; for example, Switzerland and the Netherlands and, to a lesser extent,
Italy.
    As for the United States, the adoption of "intellectual property" laws
started with the Patent Act of 1790 and extended progressively to more
and more areas of business. The first U.S. patent was granted in 1790 to
Samuel Hopkins of Philadelphia for "making pot and pearl ashes," a cleaning formula used in soap making. Since then, the applicability of patent
law has increased steadily, with new industries and areas of invention being
added one after the other. The length of patent terms has also increased, as
the courts' rulings have leaned more and more in favor of patent holders. There have been a few temporary setbacks to this trend, and they have
been associated either with renewed antitrust efforts or with situations of
national emergency, such as the First World War and, especially, the Second
World War. This fact, by itself, is revealing and noteworthy: that patents
could or could not be used in one area of research or in a whole industry
has never been the outcome of a spontaneous, well-informed, and wellreasoned decision by the legislative branch. It has always happened in bits
and pieces by mixing court rulings with small legislative changes, and always
upon request from the industry that "needed" to be monopolized - oops,
protected. It would take another book to spell out the fascinating political
economy account of how one mature industry after another patentability
grew over time because of lobbying by would-be monopolists that had run
out of steam for inventing and were too afraid of newcomers or foreign
competitors. Various historical episodes (the 1870s, and the 1970s-1980s,
especially) give the impression that slow productivity growth favors extensions of patentability, as all three branches of government gave in to the
pressure of incumbent firms trying to preserve profitability by increasing
monopoly power instead of competing harder.

    The crucial fact, though, is that the following causal sequence never
took place, either in the United States or anywhere else in the world. The
legislature passed a bill saying, "Patent protection is