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About this book

Based on economic knowledge and logical reasoning, this book proposes a solution to economic recessions and offers a route for societal change to end capitalism. The author starts with a brief review of the history of economics, and then questions and rejects the trend of recent decades that has seen econometrics replace economic theory. By reviewing the different schools of economic thought and by examining the limitations of existing theories to business cycles and economic growth, the author forms a new theory to explain cyclic economic growth. According to this theory, economic recessions result from innovation scarcity, which in turn results from the flawed design of the patent system. The author suggests a new design for the patent system and envisions that the new design would bring about large economic and societal changes. Under this new patent system, the synergy of the patent and capital markets would ensure that economic recessions could be avoided and that the economy would grow at the highest speed.

Table of Contents

Frontmatter

Chapter 1. Patents and Economics

Abstract
This chapter explains the links between patents and economics and provides an overview of the book.
Samuel Meng

Chapter 2. Logic, Politics and Economics—A Brief History of Political Economy

Abstract
Logical thinking plays a crucial role in any scientific discipline. Economics is no exception. However, the function of logic in economics has been downplayed during the econometricalization or empiricalization in recent decades. This chapter briefly reviews the history of economics and discusses the role of logic in the past, present and future economic development.
Samuel Meng

Chapter 3. Statistical Sophistry

Abstract
Since the late 1940s, statistical analysis has been increasingly applied to economics discipline. As a result, today’s macroeconometrics is essentially a synonym for macroeconomics. Is it sound to apply probability laws to macroeconomics? What is the consequence of econometricalization? What is the scientific way to conduct macroeconomic research? This chapter attempts to answer these questions.
Samuel Meng

Chapter 4. A Critical Assessment of Different Schools of Economic Thought

Abstract
The recurrence of economic recessions has stimulated substantial research in this area and has given birth to a number of schools of economic thought. However, different schools have been fighting with each other and this has made macroeconomics a warring zone. Chapter 3 introduces major schools of economic thought and discusses their strong points and their deficiencies.
Samuel Meng

Chapter 5. A New Theory on Business Cycle and Economic Growth

Abstract
Starting from an investigation into the nature of business cycles, Chapter 4 illustrates a new theory to explain business cycle and economic growth. This theory is subsequently derived rigorously by using economic models. The implications of the new theory are also discussed. The chapter ends with a demonstration of empirical evidence relevant to the new theory.
Samuel Meng

Chapter 6. A New Patent System to Usher in an Innovative Economy

Abstract
According to the previous chapter, economic recessions result from innovation scarcity. Since patent laws are supposed to stimulate innovations, the scarcity of innovation reflects the ineffectiveness of the current patent laws. Chapter 5 examines the current patent system, questions the balanced approach which supports the design of the current patent system, and suggests a new patent system which can stimulate innovation while minimizing the abuse of patent monopoly.
Samuel Meng

Chapter 7. The Future of Our Economy and Society

Abstract
This chapter envisions a number of economic and societal changes that would be brought about by implementing the new patent system. The synergy of the patent market and the capital market would ensure that the speed of innovation matches that of production, so the economy would grow at the highest speed possible and economic recession can be avoided. The new patent system would also make inventors the richest class and thus transform capitalism into patentism. The chapter also discusses the era beyond the new patent system.
Samuel Meng

Backmatter

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