(Actually it's good to have someone actually look into the data and challenge the dominant assumptions. And someone from the existing power structure, like the NBER in this case.)
> If patents are important in some industries (such as manufacturing machinery) but not in others (such as scientific instruments or chemicals in the 19th century), changes in patent laws may influence the direction if not the level of technical change (Moser 2005). These patterns are borne out in exhibition data: Countries without patent laws contribute as many exhibits and prize winners as countries with patent law. But their innovations are disproportionately focused on industries in which secrecy is effective, so that inventors are less dependent on patents.
Moser 2005 also points out that as the efficacy of reverse engineering increased (today you can reverse engineer almost anything pretty cost-effectively), more exhibitions started to focus on industries with stronger patent protection.
This is a curious point, however: it almost suggests that the proportion of innovators in a given population is (was) fixed, and they would innovate where the promise of rewards is highest.
Another important point: Cheaper patents meant "democratization of invention". There were more exhibitions with patents from people in rural areas in the US, where patents were cheaper, compared to UK, where patents were more expensive and almost all inventors were based in London.
One problem with this paper is that it makes broad generalizations based on narrow data: The fact that plant patents didn't increase the number of new rose varieties registered gets the headline "Intellectual Property Rights for Living Organisms Have Not Encouraged Innovation". It draws conclusions about innovation based on exhibit data where, by the author's own admission (Moser 2005), exhibitions may have significantly discouraged the inclusion of exhibits that were easy to copy.
Also, it's important to look through the other cited studies, because they almost always present data that is different from other papers. Some data can be more compelling than others.
Nonetheless Moser provides a fascinating view into how innovation may be influenced by incentives and policies.
True but I'll add that often for individuals to quit their jobs and focus on innovating requires more than just "the promise of rewards". Immediate funding often trumps the promise - and that funding comes from some kind of investor. Many investors view patents as: 1) a way to recoup at least some their investment dollars if the innovator can't monetize, 2) prevent competitors from simply copying the results of the R&D.
> "Actually it's good to have someone actually look into the data and challenge the dominant assumptions"
Challenging the dominant assumption would be to challenge Bessen's number and the numerous articles that automatically assume that value to be true.
[1] http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2117421 [2] http://www.iam-media.com/blog/Detail.aspx?g=454c1adc-52c3-4c... [3] https://gametimeip.wordpress.com/2012/07/30/patent-scholars-...