Abstract

Patent law is often understood through the fiction of social contract. The author argues that this fiction does not offer an adequate economic or political theory of patent law, that is, one that will explain the unique relationship between government and property that patents entail. As an alternative to social contract theory, a regulatory theory of patent law is developed based on the assurance game taken from game theory. The assurance game is used to show how patent law serves to regulate the invention process and the market for innovative products.