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Comment by karlkeefer | Hacker News Reader

> The current system is far from perfect, but it does favor upstarts and entrepreneurs' ability to build business rather than incumbents.

I think exactly the opposite is true. Patents are one of the primary ways that incumbents are able to rent seek on their inventions for decades. These large companies hoard patents, and are legally granted monopoly on a given technology, making direct competition on their invention illegal.

A world without patents would be more enabling to small entrepreneurs, because the amount of things they are allowed to attempt is so much higher than in our current world.

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> Patents are one of the primary ways that incumbents are able to rent seek on their inventions for decades. These large companies hoard patents, and are legally granted monopoly on a given technology, making direct competition on their invention illegal.

Totally agreed, and the solution there is (in my opinion) to reduce the duration of such patents to the point where newcomers have a reasonable chance to bootstrap a business based on that patent, but not so long that patents bar competitors from coming to market down the line.

Value-based taxation will always favor those with deep pockets who can afford to pay top dollar to scrape the cream off of small businesses.

Let's suppose you had some novel idea that would greatly increase the value of a social network, idea X. In the current system, you can patent it, build a working version, and then either sell out to FB or another major tech company (ala Instagram) or go public (like Snapchat). Without patents at all, FB sees your app start to take off, looks at it's key feature, assigns N engineers to duplicate it and rolls it out to billions of users. Your app then is a sad knockoff of FB's shiny new feature, withers and dies.

Meanwhile, with a Georgist tax, either you have to raise hundreds of millions just to pay the tax when created, or FB buys your patent for peanuts.

Has anyone ever had a novel idea for a social network, patented it, and been paid for it by FB?

Because it seems to me, the way the patent system is supposed to work, and the way it actually works in practice, are very different.

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