A patent on all flying machines?
In this article, Merges and Nelson explore the policy issue of patent scope. To use one of Chiang's favorite examples, should the Wright brothers have received a patent on all flying machines, or only on wooden flying machines with wings and rudders? In one of the few earlier treatments of this issue, Kitch argued that broad patent "prospects" (e.g., on all flying machines) allow an inventor to efficiently coordinate the development of an idea and to avoid wasteful racing. But Merges and Nelson argue, both theoretically and with historical examples, that racing is rarely so wasteful and that "when it comes to invention and innovation, faster is better." They summarize their basic conclusion:
Without extensively reducing the pioneer's incentives, the law should attempt at the margin to favor a competitive environment for improvements, rather than an environment dominated by the pioneer firm. In many industries the efficiency gains from the pioneer's ability to coordinate are likely to be outweighed by the loss of competition for improvements to the basic invention.
Merges and Nelson look in particular at the different innovative processes in (1) cumulative technologies, (2) chemical technologies, and (3) science-based technologies, and they discuss ways in which patent doctrine can be used to tailor patent scope in different areas.
Chiang built on this economic approach to patent scope in his levels-of-abstraction article (and there is also a vast economic literature on the subject), but he more recently wrote that "[t]he problem with this economic balancing approach is that courts lack the capability to directly measure such economic variables as social benefits and monopoly costs with any degree of precision"—instead, he argued for "keying patent scope to the novelty of the idea."
Most serious IP people know that the Wright Brothers never received a patent with claims -- on all flying machines --.
The Wright patent was about three-dimensional control, embodied by them as wing-warping. The Wright Brothers were first, didn't lose any infringement cases, but were not a pioneer firm that dominated the market.
The Wright Brothers filed their patent application BEFORE they achieved flight in December 1903.