Surely one benefit of permitting the research to proceed will 
be our increased knowledge of molecular processes. Increases in 
knowledge, however, are conditional on the costs of information. 
These costs include actual monetary investments, payments for staff 
and equipment, as well as payments necessary to overcome institutional 
barriers. Payments for patent rights or extra expenditures on research 
to develop techniques circumventing patent coverage fall into this 
latter class. If the opportunities inherent in the recombinant techniques 
are to be realized in the shortest possible time, barriers (costs) to 
information exchange must be minimized. 
A patent creates a significant barrier to information exchange. 
Its effect is to confer monopoly rights to the patent holder over a 
specified time period. Patents provided to scientists for discoveries 
of techniques useful only in the furtherance of basic research reduce 
the probability of achieving further advances due to the high cost, 
both monetary costs and the loss of time, incurred by other scientists 
required to purchase rights or to devise other techniques circum- 
venting the patent claim. Thus the benefits accruing to the public 
in the form of advances in knowledge, and later as useful products 
such as medicinals would be postponed and/or made more expensive. 
In this way it can be seen that conferring patent rights, at this 
stage, would reduce potential benefits making the already precarious 
benefit/risk balance even more so. 
It may be argued that patent rights induce invention; an argument 
which would seem to contradict the foregoing argument. But in act- 
uality, patent rights are employed as a mechanism for compensating 
risk.* And in this case, because of full ' governmental funding, this 
risk is absent. Extra motivation is of course provided by the "will 
to know," as well as by the prestige obtained through publication, and 
for extraordinary advances by monetary rewards such as the Nobel Prize 
Were patents allowed in such govemmentally funded research, 
this would permit private interests to capture extra benefits to the 
extent the patent was marketable. The patent holder could in effect 
charge the public for the discovery. This would result in a welfare 
loss to the public who would not only have funded the research effort, 
paying salaries and overhead, but would also now pay a rent for the 
use of the product. This is double payment. Patents to researchers 
operating under government grants could thus harm the public in two 
ways: 1) Create barriers to information exchange; 2) Make final 
products more expensive. 
*K. J. Arrow, "Economic Welfare and the Allocation of Resources For 
Invention," in The Rate and Direction of Inventive Activity : Economic 
and Social Factors , National Bureau of Economic Research, Princeton 
University Press, 1962, pp. 609-626. 
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