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SHOULD BUSINESS METHOD INVENTIONS BE PATENTABLE?
ABSTRACT
In this article, I define business method inventions and provide an economic
framework to address the question of patentability raised in Bilski. A business
method invention is the discovery of a commercial technique that firms can
apply to address market opportunities. The initial implementation of a business
method invention by firms is a Schumpeterian innovation. I advance several arguments
in favor of business method patentability. Business method inventions are
an important foundation for entrepreneurship and a channel for the commercialization
of scientific and technological inventions. IP protections for business
method inventions are essential for economic efficiency, including incentives for
invention, efficient allocation of inventions, and transaction efficiencies in the
market for discoveries. Business method inventions are significant because they
are the foundation of what I term the ‘‘Business Revolution’’: the augmentation
and replacement of human effort in business transactions by computers, communications
systems, and the Internet. I conclude that the patent system should continue
to provide intellectual property protections for business method inventions
just as it does for other types of inventions.
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