Is it true that Pareto optimal outcomes in economics lead to greater efficiency for all consumers and producers alike? — Shawn

I specify this by stating that if a good, like a patent or intellectual property, achieves pareto optimality, then does this mean that it increases efficiency in the economy by making supply meet demand at a point where a firm or company wouldn't have to invest more money to meet rising demand? — Shawn

Yet, as normal patents are made with perfect knowledge for producers to invest in, pareto optimality often doesn't occur, as firms with more money to invest in patents will find and simply buy out the patent that either increases or harms their profits. — Shawn

What should one do about such a tendency in the patent realm? If gas company buys out my patent that normally entering the economy would produce an increase in efficiency for X Kwh of energy rather than Y Kwh from gas or oil, then shouldn't there be a law prohibiting such anticompetitive measures against a net increase in overall GDP from a more efficient use of a patent? Hence, shouldn't these pareto optimal outcomes be propped or even protected by the government to increase the net GDP and efficiency of a economy? — Shawn

I'm more concerned with the issue if a patent that can contribute to greater efficiency in the economy or as you say, a social and environmental benefit, is bought out by a firm to prevent losses to their company, and if that were true then should the government intervene?

What do you think? — Shawn

Compulsory licensing of a patent is provided for under Article 5 of the Paris Convention to prevent patent abuse.[7] Article 5, section A(2) provides that ‘[e]ach country of the Union shall have the right to take legislative measures providing for the grant of compulsory licenses to prevent the abuses which might result from the exercise of the exclusive rights conferred by the patent, for example, failure to work.’ Section 4 provides that the compulsory licence may not be applied until after ‘the expiration of a period of four years from the date of filing of the patent application or three years from the date of the grant of the patent, whichever period expires last.’ The patentee can avoid the compulsory licence if he ‘justifies his inaction by legitimate reasons.’ The licence is non-exclusive and non-transferable. — International bar association