FWIW,
here's an older thread. I particularly like Borodog's first post.
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IE why cure cancer if as soon as you find the cure 10000000 companies buy your medicine then reproduce it themselves.
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For one, it can keep it secret. There is also always a value to being the first to the market with an idea. If a company thinks it's can cure cancer, do you think that just because others might copy them is going to make a difference? There's still money to be made, and they stand to make the most all other things being equal. But this situation is inheriantly a double edged sword. If we are going to only let the company make money of the origninal idea, competition to make the product better or cheaper suffers.
There are ways to protect IP cheaply, through voluntary contracts, such as say "You agree not to copy and distribute this or aid others in it by buying this" or whatever labels on the back. However, other then that protection of IP is very costly and in a free market I doubt would be very prevelent (notice that the costs of protecting IP now is externalized onto taxpayers).
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the result is a competitive market where no economic profits exist. why should I work on entering a market that would create ZERO (economic) profit?
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What do you mean by economic profit (I'm guessing it means something different from just plain profit)? Because finding a cure to cancer, even if you knew companies would duplicate it, surely is profitable, no?