You're not trying to minimize litigation costs, but rather maximize R&D investment net of litigation costs. So the question is, if competitors could quickly copy the results of R&D efforts, would R&D investment be more or less than 14% lower? Also, it's not like litigation costs under those alternative regimes would be zero. At the end of the day, the free-rider problem is a real economic problem and permitting it undermines market efficiency. One can imagine alternative models for addressing it, but those frameworks will have a cost too.
> It also enables business models that allow taking money from people without contributing anything at all.
That incorrectly assumes that the only "contribution" is producing an end-user product. ARM, for example, doesn't produce end-user products. You can't go to ARM and buy Cortex A72 CPUs. When MediaTek produces an SoC integrating an ARM core, is the license fee an example of ARM simply "sharing profits without doing the work?"
> The downstream blocking effect of existing monopoly grants on incentives for future innovation has greatly increased in recent decades because modern products are made up of so many different components.
Hold-up problems are real, and there is a real question of how to properly value all the technologies that go into a modern product.
> I.e., you're not paying for an invention, you're paying for a standard, and making standards is not something that requires external incentives.
If standards don't embody important technical contributions, then why don't implementers rush to create alternative, unpatented standards? 802.11 has been out for more than two decades. Why do implementer companies continue to pay for each new generation of 802.11, instead of developing their own? If the choices truly are arbitrary, it should be trivial to avoid the relevant patents (indeed, everything in 802.11a should be out of patent by now, or close to it).
The idea that alternative monetization strategies are workable in the large scale is almost self-refuting. Patents don't preclude you from developing technology and releasing it into the public domain, so long as you get there first. But it seems like companies motivated by patent protection consistently "get there first." That is itself a validation of the incentive structure created by patents.