Against Intellectual Monopoly

contrary to before, a "new" plant or animal
could, in principle, be exactly identified and that its "creation" was equivalent, therefore, to the invention of a new mechanical tool. Note an important detail: during the many decades it took to buy monopoly protection from Congress, the breeding industry was, literally, blossoming and growing under conditions of competition and without intellectual monopoly
protection. In fact, it had prospered so much that its economic power and
ability to influence Congress and the public opinion increased to the point
that it was able to eventually have the law changed.

    Once again we are faced with the basic pattern noted earlier. Innovative
and dynamic industries emerge either because intellectual monopoly is not
present or because it can easily be bypassed. They grow rapidly because
competition and imitation allow and force their firms to innovate or perish.
In fact, in the early stages, agricultural innovators often would provide
their customers with incentives to copy and reproduce their seeds, as a
tool to spread their use. However, as the industry grows more powerful
and opportunities for further innovation diminish, the value of monopoly
protection for the insiders increases, and lobbying efforts multiply and most
often succeed.
    In the case of the breeding industry, a partial victory was first achieved
during the Great Depression, with the Plant Patent Act of 1930. The victory was only partial because, mostly as a result of issues of enforceability,
patents were allowed only for plants that could reproduce asexually. The act
explicitly excluded tuber and sexually reproducing plants. For these crops,
the scientific knowledge of the times made it impossible to satisfy the patent
law requisite that a patentable invention be disclosed specifically enough to
be identically reproducible.
    As the reader may imagine, this limitation did not please the American
Seed Trade Association, which had greatly contributed to the lobbying
effort. Although it was a useful precedent, the 1930 act was too weak and
covered too few plants; hence, it did not really provide breeders with the
extensive monopoly power they sought. Such weakness revealed itself in
the fact that, while agricultural innovations continued at a substantial pace,
only 911 plant patents were assigned in the period until the early 1950s. In
the meanwhile, lobbying by potential monopolists did not go away; instead
it intensified as new and powerful interest groups joined the clan. The
discovery of the DNA code, and the subsequent development of biological
engineering, would, eventually, come to rescue the monopolist's demand
for full protection.
    To summarize, (1) before 1930, only some mechanical and chemical
inventions related to agriculture could be patented. (2) In 1930, the Plant
Patent Act offered patent protection to asexually reproduced plants. (3) In
1970, the Plant Variety Protection Act extended such protection to plants that are sexually reproduced. (4) Between 1980 and 1987, patent protection was extended to the products of biotechnology. One would expect
this progressive extension of "intellectual property" protection to bring
about a dramatic acceleration in useful innovation, at least since the early
1970s.

    One measure of useful innovation is what economists call total factor productivity (TFP): how much output (of food, for example) can be
produced from given inputs (labor and land, for example). So, we might
expect that the growth rate of TFP in the agricultural section accelerated
in response to all this additional patentability. This is not the case, as the
historical data clearly show: in the United States, agricultural TFP has been
growing at a remarkably constant pace since the end of the Second World
War." More precisely, the average growth rate from 1948 to 1970 was
essentially the same as from 1970 to 1992 - that is, about 50 percent -
and it seems to have marginally slowed down after that. Oscillations in
TFP have certainly increased in size, which is hardly a good thing besides
being hard to interpret. Some argue that it is still too early to tell, an
argument we find pretty hard to understand and to debate: if more than
thirty years is not a long-enough period for increased "intellectual property" protection to bring about its benefits for society, then why bother with
patents?

    But, perhaps, agricultural TFP is too broad a measure of