Proponents of intellectual property rights often rely on one of two lines of reasoning.
The first is based on the misunderstanding that the frequency or volume of innovations determine economic growth. The second is captured by the question, “So if I spend $1 billion on R&D (research and development) to bring a new drug to market, anyone should be able to copy my drug without compensation?” Both are based on the same fundamental error: assuming that innovation is a matter of production. It is not. Innovation is all about entrepreneurship, and that’s why intellectual property rights do not and cannot help.
The economic growth argument appears to be in line with empirical observation. After all, it is the introduction of and change caused by valuable innovations that make us better off and raise our standard of living. But as is so often the case, observations in economics tend to lead to problematic if not false conclusions. The market is a trial-and-error process under uncertainty, in which entrepreneurs and businesses compete by offering goods and services anticipated to satisfy consumers at a future point in time better than the offerings of others. Then, obviously, innovations are important.