Do intellectual property rights involve a private power to tax?

This article criticizes the standard approach to intellectual property rights (IPRs), interpreted as property rights conferring a monopolistic position, by showing that a public good is not a suitable basis for a private monopoly and that the bundle of rights included in an IPR is so different from those enjoyed under a standard monopoly as to suggest a different mechanism is at work, i.e., a private power to tax has been granted. To highlight how this novel approach works, mainstream economic models of economic growth based on R&D, whether protected or not by IPRs, are revisited. The theory of taxation is then recalled, to show that taxes involved by IPRs can range from an amount equal to the monopoly profit to Lindahl taxes. Finally, the principles of taxation elaborated by economic theory are examined for clues to improving the design of IPRs.