Between patents and copyrights, which reflects a free market, and which is a grant of monopoly privilege by the state? Patents give inventors or developers of new products the exclusive right to sell their products for a specific time. By protecting sellers from the encroachment of competition, patents enable innovators to charge higher prices and to recover their products' development costs. Copyrights work in a similar way, protecting the authors of software, music, movies, books, and other published works. Many people consider patents and copyrights as being equivalent. Do you think they have the same purpose and effect?
In this Application, you will analyze the economics of the purely free market. Why do you believe that most successful industrial societies offer patent and copyright protection, even though these protections enable sellers to charge higher prices? Can the sellers charge whatever they want? Why or why not? Provide an example to support your opinion.