Menu Close

Is it impossible to envision a world without patent monopolies?

We should not face very high prices for a Covid-19 vaccine
Dean Baker

Apparently at the New York Times the answer is no. Elisabeth Rosenthal, who is a very insightful writer on health care issues, had a column recently warning that we may face very high prices for a coronavirus vaccine. She points out that this is in spite of the fact that government is paying for much of the cost of the research. Rosenthal then argues we should adopt a system of price controls or negotiations, as is done in every other wealthy country.

While her points are all well-taken, it is amazing that she never considers the simplest solution – don’t give companies patent monopolies in the first place. The story here is the government is paying for most of the research upfront. Why does it have to pay for it a second time by giving patent monopolies?

“Administering Flu Vaccine” by Government of Prince Edward Island (licensed CC BY-NC-ND 2.0)

There is no reason that the government can’t simply make it a condition of the funding that all research findings are fully open and that any patents will be in the public domain so that any vaccines will be available as a cheap generic from the day it comes on the market.

Not only does this ensure that a vaccine will be affordable, it will likely mean that progress will be more rapid, since all researchers will be able to immediately learn from the success or failures of other researchers.

It is amazing that this obvious route is not being considered in public debate. Government-granted patent and copyright monopolies are one of the main ways in which we generate inequality. Bill Gates would still be working for a living without them.

At a time when the United States is newly focused on racial inequality, it is striking that reducing the importance of the factors that generate inequality in the first place is not up for discussion. This is fitting with the good old “White Saviour” theory of politics.

Rather than changing the government- created structures that act to generate inequality, they would rather have the beneficent government push policies that reverse some of the inequality government structures created in the first place. I suppose this route is more appealing to the liberal psyche, but it ignores economic reality, and also at the end of the day, is likely to be less effective politically.

Source: Real World Econ Rev, 6 July 2020


Dean Baker is a macroeconomist at the US Center for Economic and Policy Research.


Leave a Reply