The International System of Intellectual Property from the Perspective of the Economics of Legal Federalism

Abstract

The international system of IPRs (patents, copyrights) is a complex and partly fragmented two-level system of national IP law regimes and international treaties, characterized by a combination of minimum harmonisation and the retaining of some national sovereignty (e.g., TRIPS agreement with "flexibilities"). Taking up the proposal of Dinwoodie & Dreyfuss (2012) to conceptualize the international IP system as a 'neo-federalist' system, we use the economic theory of legal federalism with its framework of economic criteria for the advantages and disadvantages of more harmonisation or diversity for the analysis of the international patent system. Important results from an economic perspective are that there might also be good economic reasons why patent laws should not be fully harmonised (esp. due to different policy objectives and the advantages of experimentation), but that a greater harmonisation would also allow for reducing costs through applying mechanisms for better collaboration between patent offices (e.g. through work-sharing). Overall, an economic analysis from the perspective of legal federalism can lead to a better understanding of the complex trade off-problems between the benefits and costs of harmonisation or diversity in regard to intellectual property.