alleryStart learning →One way to encourage new technology is to guarantee the innovator an exclusive right through:
AMinimum wage rules
BImport tariff walls
CProperty rights on ideas
DConsumption tax relief
Answer & Solution
Correct answer: C. Property rights on ideas
1. If ideas spread freely, the innovator captures little of the benefit.
2. One way to increase new technology is to guarantee the innovator an exclusive right to that new product or process.
3. That guarantee is provided through intellectual property rights.
4. The exclusivity restores the private incentive to invest in innovation.
_Source: OpenStax Principles of Microeconomics for AP(R) Courses 2e (CC BY 4.0), Ch 13 'Positive Externalities and Public Goods', sections 13.1-13.4_
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