Patent laws in the United States have encouraged innovation by attempting to strike a careful balance - allowing the inventors of new technologies to reap the benefits of their innovations, while at the same time encouraging the timely diffusion of new technologies and limiting the damage from monopoly power.48 In the past, patent laws have primarily emphasized protection of the new technologies or production processes associated with invention.
Given that recent innovations have, to an increasing extent, encompassed the transformation of electronic data to create new methods of business practices, the challenge today is to ensure that such innovations are afforded the appropriate degree of protection ensuring that innovators are rewarded for their ideas but not granting them so wide a range of territory in the property-rights battlefield that they acquire a stranglehold on the economy and, perversely, are allowed to choke off the innovation that they helped create.49 Similarly, allowing businesses the flexibility to reorganize their operations in ways that permitted them to take maximum advantage of new technologies has been instrumental in translating technological innovations into higher productivity in all four episodes.