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The concept that has been upheld for the current system in the past is: Companies do R&D, some fails, and some succeeds, and the profits from the successes pay for both the failures and successes. The poster I was replying to points out that this concept isn't actually what is happening (at least, anymore, for some areas) - instead, smaller companies do R&D - some fail, and the investment is lost; some succeed, and the profit from being BOUGHT rewards the investment. The reward for success is great enough that some investors will gamble on these small companies (while the big companies investors are investing with lower risk, lower rewards). I pointed out that this is very similar to the XPrize - private investment was done in many companies, but only one (ish) would win. (This is actually a bad analogy, since the XPrize was much more about status - the prize wasn't large enough to truly be significant to a company that could claim it). My (unspoken) point was that the govt could stipulate controls on the resulting product - companies could research with greater confidence of what payout they'd get (on success, of course), but the incentive for price gouging is removed. The difference between today's IP-monopoly and the XPrize is that the prize was a known amount, and in the part I didn't state, minimal profit would be had past that, compared to today's "you get as much as you can gouge, for as long as you can abuse rent-seeking". Really I just did a terrible job of explaining my point. |