An Empirical Study of the Optimal Patent Term

Theoretically, the ideal term of a patent is to set up to expire when the social costs outweigh the benefits. However, given the decline in returns from patents over time and the discount rate of the annual patent value, a period of 20 years is actually quite a long time for the average inventor. In particular, considering that the product cycle in the high-tech industry is very short, it is doubtful whether the current long and uniform duration adequately reflects society's expectations, or whether the costs for access or transaction are excessively imposed. Many studies on finding the optimal patent term have discussed it as an economic point of view. Some have proposed an optimal patent policy through a combination of patent length and scope, while others have suggested adjusting the strength of patent protection through a single adjustment of the length. This paper attempts to approach this problem based on the latter. And when setting the optimal patent term, classification by industry(or by technical characteristics) should be premised. This is because, in fact, the cost of developing an invention and its benefits in terms of social welfare vary from field to field. This paper emphasizes the need to shorten the term of patents and grant differentiated terms for each category of patents, and proposes to realize these policies.