The inventive step is the critical variable in determining balance between patent costs and patent benefits. Set at the right level it ensures that the knowledge spillovers from new inventions offset the costs of restraining competition. But asking the question "is it obvious?" sets a far lower...

Drawing on case law and the results of an empirical study, this paper demonstrates that the height of the inventive step in Australia is close to zero and substantially different from the "significant advance over what is known" advised to the Australian parliament in 2011. To "raise" the height...

Economists assume there is new knowledge or know-how embedded in patented inventions. This new knowledge should result in spillover benefits which can provide dynamic efficiency gains to offset the static efficiency losses of the patent system. Unfortunately this assumption is out-of-date....

Despite advice to parliament that patents are granted only for "a significant advance over what was known and what was available to the public" the evidence shows this is not the standard used. The actual standard is a scintilla – a marginal difference from what is known. The consequence of...