In late 1764, while repairing a small Newcomen steam engine, the
idea of allowing steam to expand and condense in separate
containers sprang into the mind of James Watt. He spent the next
few months in unceasing labor building a model of the new engine.
In 1768, after a series of improvements and substantial borrowing,
he applied for a patent on the idea. August found Watt in London
about the patent and he spent another six months working hard to
obtain it. The patent was finally awarded in January of the
following year. Nothing much happened by way of production
until 1775. Then, with a major effort supported by his business
partner, the rich industrialist Matthew Boulton, Watt secured an
Act of Parliament extending his patent until the year 1800. The
great statesman Edmund Burke spoke eloquently in Parliament in
the name of economic freedom and against the creation of
unnecessary monopoly – but to no avail. The connections of
Watt’s partner Boulton were too solid to be defeated by simple
principle.
...
After the expiration of Watt’s patents, not only was there
an explosion in the production and efficiency of engines, but steam
power came into its own as the driving force of the industrial
revolution. Over a thirty year period steam engines were modified
and improved as crucial innovations such as the steam train, the
steamboat and the steam jenny came into wide usage. The key
innovation was the high-pressure steam engine – development of
which had been blocked by Watt’s strategic use of his patent.
...
In most histories, James Watt is a heroic inventor,
responsible for the beginning of the industrial revolution. The facts
above suggest an alternative interpretation. Watt is one of many
clever inventors working to improve steam power in the second
half of the eighteenth century. After getting one step ahead of the
pack, he remained ahead not by superior innovation, but by
superior exploitation of the legal system. The fact that his business partner was a wealthy man with strong connections in Parliament, was not a minor help.
Was Watt’s patent a crucial incentive needed to trigger his
inventive genius, as the traditional history suggests? Or did his use
of the legal system to inhibit competition set back the industrial
revolution by a decade or two? More broadly, is the system of
intellectual property – patents and copyrights – with all of its many
faults, a necessary evil we must put up with to enjoy the fruits of
invention and creativity? Or is it an unnecessary evil, a relic of an
earlier time when governments routinely granted monopolies to
favored courtiers?
