Abstract The doctrine of patentable subject matter precludes basic inventions such as abstract ideas and laws of nature from patent protection. However, current economic thinking of the patent system stresses the necessity of rewarding pioneering inventors in the cumulative innovation process. In a two-stage innovation model where the first stage invention (basic invention) has no stand-alone value and the pioneer can also participate in the second stage, I show that patent protection to the basic invention may increase rather than hamper the second stage performance. Rejecting patents on the basic invention can promote technology progress when the pioneer has high capacity, but the follower has low capacity to engage in the second stage innovation