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A patent is a legal document that protects an inventor's exclusivity to his invention. This gives an incentive for inventing useful things, as the inventor can earn fees, also known as royalties, by obtaining a patent and then licensing it to others. There are several types of patents.

The patent right is, in the language of the American patent statute, "the right to exclude others from making, using, offering for sale, or selling" the invention in the United States or "importing" the invention into the United States. What is protected is not the right to make, use, offer for sale, sell or import, but the right to exclude others from making, using, offering for sale, selling or importing the invention. Once a patent is issued, the patentee must enforce the patent without aid of the U.S. Patent and Trademark Office.[1]

There are three types of patents:


To be the subject of a U.S. utility patent, an invention must be new, useful, and non-obvious. Obviousness is determined from the standpoint of a person having ordinary skill in the art who had no knowledge of the invention itself. Other countries typically require novelty, inventive step (in practice the same thing as non-obviousness), and industrial applicability (a somewhat more stringent standard than utility). They may also exclude certain categories of inventions patentable in the United States, such as methods of diagnosis or treatment performed on a human or animal body and computer-implemented business methods.

Patent Term

In the United States, the term of a utility patent (filed after 1995) is 20 years from the earliest non-provisional U.S. filing date of which the patent application claims the benefit, although that term may be adjusted for excessive delays on the part of the U.S. Patent and Trademark Office (not those on the part of the applicant).[2]



Patents are a distortion of the free market, since they essentially create an artificial monopoly for the patent holder. Many economists believe that patents are a good idea nevertheless, because they encourage research and development and the products that result ultimately increase net welfare for consumers. Also, the details disclosed in a patent may lead to further improvement of a product by other inventors.

Some opponents of patents believe that any such distortion of free trade and other free market outcomes is automatically bad for society. Other critics believe that patents are too easily abused. "Patent trolls" may defend their patents not to protect their own interests in producing a product, but merely to harm competitors. Other critics of patents contend that the U.S. Patent and Trademark Office does a poor job of reviewing applications, often issuing patents that are too broad or that overlap previously patented inventions.


  2. 35 U.S.C. § 154
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