Patents and Open Innovation: Bad Fences Do Not Make Good Neighbors

Abstract

This paper analyses the links between patents and open innovation. Departing from the "second best" approach to patents, it has recently been argued that patents can accelerate open innovation by fostering collaborations, exchanges and interactions between actors in the innovation process. The argument put forward is that "good fences make good neigh-bors", suggesting that by protecting innovative actors from free-riding, patents reduce the costs and dangers of open innovation. We show that patents do not necessarily provide good fences. The proliferation of patents in some sectors and the bad quality of patent information usually makes it very difficult in reality to agree upon what is and what is not protected by a patent. This prompts problems such as anticommons, trolling (hold-up), and the multiplication of wasteful litigations. We conclude by discussing some evolutions of patent laws which could limit those problems and make patents a real support for open innovation.