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Abstract

A “verdict” on the economic value of the patent system of the US economist Fritz Machlup published in 1958 still has an important impact on assessing the economic effects of the patent system on economic development by academic intellectual property (IP) scholars worldwide. This contribution analysis Machlup’s study as is and in the light of subsequent US and global legal and economic developments. Based on empirical data, it pays attention to the impact of the US Bayh-Dole type legislation on the translation of basic research into innovative products and processes, as well as to the impact of the new world economic order under the auspices of the World Trade Organization (WTO) on economic development of developing and emerging economies. All largely ignored in critical academic writings, discussing, e.g. the specific problem of patenting human genes. The case of China, which adopted its first Patent Law in 1984, addressed in the context of Machlup’s verdict and in light of the subsequent economic, scientific and technological development of that country. Concluding thoughts consider today’s value of Machlup’s “verdict.”