Does Intellectual Monopoly Help Innovation?

In this paper, we begin our analysis of copyrights and patents by asking: why should creators have the right to control how purchasers make use of an idea or new good? This gives creators a monopoly over the idea. We refer to this right as "intellectual monopoly," to emphasize that it is this monopoly over all copies of an idea that is controversial, not the right to buy and sell copies. The government does not ordinarily enforce monopolies for producers of other goods. This is because it is widely recognized that monopoly creates many social costs. Intellectual monopoly is no different in this respect. The question we address is whether it also creates social benefits commensurate with these social costs.