Technology Patents Encourage Innovation

The work of Professor of Economics and Public Policy Ashish Arora is cited
in the October 20, 2005 issue of The Economist, which focuses on
intellectual property protection.

According to Arora, patents, by providing property rights in technology,
make such technology easier to trade. This increases static efficiency and
technology is transferred to those companies that can derive greatest value
from it. Dynamic efficiency is also increased and technology specialists
are encouraged and investment in research and development is promoted.

In his book "Markets for Technology, the Economics of Innovation and
Corporate Strategy," Arora and co-authors Andrea Fosfuri and Alfonso
Gambardella explain that the growth of the patent system creates a market
for innovation, providing a liquidity to knowledge that has not previously
existed, and creates and institutional mechanism for the transfer of ideas
to fuel economic progress.

Arora, Fosfuri and Gambardell also address this issue in "From Underdogs to
Tigers: The Rise and Growth of the Software Industry in Brazil, China,
India, Ireland and Israel."

Arora's research centers around the areas of economics of technological
change, management of technology, intellectual property rights, and
technology licensing. He is currently the Research Director of the
Software Industry Center at Carnegie Mellon. An enduring research interest
is in understanding the rise and functioning of markets for technology and
their consequences.