ABSTRACT
This chapter analyses the importance of the social rate of return on investments in new technology and deals with a discussion of some policy issues regarding intellectual property rights. One of the principal instruments of public policy aimed at protecting intellectual property rights in the United States is the patent system. There are important and well-known differences between the industrialized countries and the developing countries in their attitudes toward intellectual property rights. The latter countries tend to feel that intellectual property rights give inventors and innovators an undesirable monopoly on advanced technology that can be used to extract unjustifiably high prices, as well as unwarranted restrictions on the application of the technology. The social rate of return from an investment in new technology is the interest rate realized by society as a whole from that investment -- the payoff to society.
