In the modern theory of growth, monopoly plays a crucial role both as a cause and
an effect of innovation. Innovative firms, it is argued, would have insufficient
incentive to innovate should the prospect of monopoly power not be present. This
theme of monopoly runs throughout the theory of growth, international trade, and
industrial organization. We argue that monopoly is neither needed for, nor a necessary
consequence of innovation. In particular, intellectual property is not necessary
for, and may hurt more than help, innovation and growth. We argue that, as a practical
matter, it is more likely to hurt.