From Mises Blog (archived comments below); Barta comment (see Why Airwaves (Electromagnetic Spectra) Are (Arguably) Property)
See also IP Law and “Market Failure”
IP: It’s a market failure argument
Mises Blog, February 10, 2009 by Jeffrey Tucker
In the hundreds of emails I’ve received over the issue of intellectual property, the number one most common objection to doing without goes like this. We can’t subject the matters to free market competition. Some innovations are too easy to copy. Just one look or listen and the producer’s idea is taken from. Then another company that had nothing to do with bearing the costs of innovation will be able to reap the rewards. We have to have a period of monopoly if only to inspire people to innovate and bring things to market.
Now, consider first what a central-planning apparatus this entails. A vibrant and enterprising economy will consist of hundreds if not millions of innovations per day. Our work lives, no matter what field we are in, are all about doing things better, bringing better products to the world, stepping forward into a future in which ever better stuff is ever more affordable. That requires unrelenting innovation.
If you are to establish a government office to keep tabs on this activity, that alone is going to require massive bureaucracy. If the bureaucracy is charged with granted monopolies for all these things, the business of enterprise is going to find itself in an amazing tangled. If we find that society works at all, it is precisely due to the absence of such tangles.
Consider also what the above critic presumes about how markets work in world without intellectual monopolies. Consumers all sit around wanting something and wanting to pay for it. It could be a new song or a cool painting or something as simple as a q-tip. Entrepreneurs all over the country know that consumers want these things but they refuse to bring them to market for fear of being copied by the next guy. As a result, everyone just sits around doing nothing.
Is this really a realistic scenario? All experience suggests that in a vibrant economy, entrepreneurs are going look for unmet demands. This is what they live for. IP is not necessary to bring about this result, else there would have been no economic growth in the entire world until recent years when IP began to its march to ubiquity.
All these arguments really come to down to yet another market failure argument, the idea that unless the government comes to the rescue, market players will just sit around confused while the economy does down the drain.
All market failure arguments have the appearance of plausibility about them. Let’s say you have a poorly managed apartment unit with a porchlight that is out. Everyone would benefit from having the bulb changed. But if one person benefits, so does everyone. All dwellers enjoy the light and only one pays. That’s not going to work, is it? No one would act. Except that at some point, someone comes along and befuddles the failure theorists by changing the lightbulb.
So it is with markets and innovation. It is just a plain fact that many products come to us every day that are not patented. Look at a Kleenex, I mean, a facial tissue. Any paper manufacturer can make one. The Kleenex company was first to make the big time, and it has stayed on top through relentless innovation in design. So we have fancy boxes of every shape and size, tissues with oil in them, tissues with smells, and various colors and things. The company is still on top.
Boldrin and Levine give the example of TravelPro, the suitcase with wheels. Every company can replicate it. But TravelPro stays on top through new design and marketing.
Everyone has to marvel at how Arm and Hammer stays on top of the baking soda market. Talk about easy to replicate. And yet the company practically has a market monopoly, and has held it for many decades. The innovation here too is relentless: toothpaste, deodorant, cleaning products, you name it.
You can try this at home. Think of any company that has an open-source product that continues to make money and stay up top: Tupperware, Red Hat, Band Aid, Firefox, Tylenol, Bayer, Hershey. It is a long list, nearly infinite.
The competition is fierce. How do they deal with it? The model is always the same. Get there first. Stay on top through marketing. Count on brand loyalty. Innovate. Explain your superiority. Never rest on your laurels. Move forward and watch the competition carefully.
It is interesting because another market failure argument posits even that there is a reverse problem than the one used to defend IP. It suggests that the market has a “path dependence” problem, that once people get stuck on one technology or brand name, they have too high a hump to get over in order to move to one that is otherwise obviously superior.
Both can’t be true.
The defenses of IP share a trait in common with all claims that the free market can’t work. Hayek called it a kind of constructivism. We can’t imagine how a market might solve a particular problem so we conclude that the market must fail in this instance. It’s good to look outside the window and observe how the market solves the problem every day in ways we don’t expect.
There are a thousand possibilities for how producers deal with being copied even in digital media. If we open the market up to competition, we will see more innovation in book publishing and movie making, as every more goodies are piled on the consumer to earn loyalty and a range of options are made available. Consumers win, competitive producers win, and all without government privilege. What’s not to like?
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Comments (72)
- Silas Barta
- http://blog.mises.org/archives/009414.asp@Andrew_Skretvedt: Thanks!@Michael Barnett:Intellectual Property is a ridiculous fiction designed to impede competition by granting special ownership privileges to specific persons which interfere with the property rights of the masses.Oh, and who happened to coincidentally be the sole reason that such a pattern is usable. (Hey, kinda like land homesteaders!)Specifically, the idea that someone can own patterns of language, light, sound, motion, text, shape, etc. is so ludicrous
How about the idea that someone can own patterns of the EM spectrum, like radio waves? I guess that’s ludicrous too, right? Well, you mentioned light, so I guess so.
IP proponents have to fall into one of 3 categories:
Ah, nothing like demonization to prove the merit of one’s argument.
As for Tucker’s point about the cost of innovation, there are plenty of ways for the innovator to create a huge advantage for himself in bringing his innovations to market. He can start by setting up the production process prior to introducing the innovation; he can secure the resources which the production process requires, including such things as exclusive contracts or bidding up the price of the price of resources too high for competitors to come in from scratch.
So, to innovate, you have to monopolize entire markets … which is worse than intellectual monopolies for some reason.
Honestly, anyone with any sense whatsoever — with enough sense to become an innovator — shouldn’t need special privileges which infringe on the property rights of the masses in order to profit from his innovation.
Hey, why not take it further: anyone with enough sense to become an innovator doesn’t need property rights at all! Oh, wait, you define rights you disagree with as “privileges” that “violate others rights”, without realizing how you’re assuming your conclusion.
I don’t know how many times I’ve tried to pound this into Silas’ thick skull, but it doesn’t seem to be getting through.
Yes, and I’ve pounded the IP calcualtion argument, the refutation of Kinsella’s scarcity argument, the EM spectrum rights comparison argument, the “you wouldn’t endorse this in any other context” argument, and many others into YOUR thick skull (and Stephan_Kinsella’s, and Jeffrey_Tucker’s, and …) several times, but it doesn’t seem to be getting through. That’s why I think you’re in this for the demogoguery alone. You’re trying to make a name for yourself.
- newson
- to silas barta:
well yes, i can cut and paste as well as the next guy. i have provided quotes from austrians that show pareto-optimality to be a dead-end from the austrian viewpoint. pareto-improvements are the same as pareto-optimality. (improve=optimize), so no wiggle-room for you here.where are these quotes to back up your claim that pareto-improvements feature in the austrian framework? it’s time you put up.finally, in my own words, given the impossibility of anyone knowing what’s in anyone else’s head, the impossibility of polling everybody in the universe about their satisfaction, pareto-optimization/improvement is as useful as tits to a bull. - newson
- to silas barta:
as a memory jogger, here’s what you said –
“Austrians do use pareto-optimality; it’s just that they don’t always call it that.”so i want to know what they call it, and who “they” are. - Silas Barta
- @newson: Again, please focus on the substance of what I have argued instead of playing word-match.Let’s start from the original post I made that led you to quoting. I said something like, “Without IP, we miss out on huge Pareto improvements.” As should have been clear in the context, and WAS clear to anyone else reading (no one else seemed to have a problem with the pareto improvement reference), and should most certainly be clear after all of my above responses, I simply meant that there would be missed opportunities for people to become much better off, without making anyone else worse off.So, do Austrians ever use the concept of “some people becoming better off without anyone else becoming worse off”. Why, yes they do! In fact, this is the very basis on which Rothbard (in the paper you cited) justfies voluntary transactions, and only voluntary transactions, as strictly welfare-enhancing.That was the only concept I relied on in making the point you object to. I hope it is clear that there is no basis for objecting to such a concept, *especially* in the context of Austrian economics. I hope it is also clear why Cordato’s criticism of “pareto-optimality” as a general-equilibrium, static concept, is not relevant to any argument I advanced on IP, and neither are Rothbard’s criticisms of Pareto’s philosophy on welfare economics.
- newson
- to silas barta:
…and so we come to the crux of the matter. voluntary transactions are welfare enhancing, by definition. agreed.ip laws, on the other hand, cause a foreign body (the state) to intrude into the otherwise voluntary buyer/seller trading relationship.no appeals to generalized welfare benefits can be made when the element of coercion is introduced. - Greego
- It all comes down to scarcity. Property rights resolve conflict in naturally scarce goods, ie, real stuff like land, resources, objects. Intellectual property laws create scarcity in things that are naturally not scarce, ie, copyable patterns. This is backwards – property rights are not ideal, it would be better to not have to exclude others from doing something to certain ‘stuff’ (which is what a property right is) but the reality of life means that some form of exclusion is necessary to prevent conflict. It simply isn’t necessary to extend exclusionary rights to things that aren’t scarce so IP laws don’t need to exist.
- Michael Barnett
- >>How about the idea that someone can own patterns of the EM spectrum, like radio waves? I guess that’s ludicrous too, right? Well, you mentioned light, so I guess so.Yes, obviously you’re not grasping at straws here. If I say you shouldn’t have the right to patent running-in-place, then obviously it’s logical to assume that owning particular wavelengths/frequencies of the electro-magnetic spectrum is ludicrous. Because, you know, they’re the same thing.>>So, to innovate, you have to monopolize entire markets … which is worse than intellectual monopolies for some reason.No, you don’t have to monopolize them, which I didn’t suggest anyway, nor do you even have to take the lesser steps which I recommended in order to be an innovator. The facts, and pay attention here, THE FACTS are that people innovated long before the insidious IP fiction was ever perpetrated upon the masses. There was art, literature, music, scientific discovery, new technology, etc. before there was IP. Therefore, from even a strictly empirical point of view, which is what your entire argument rests upon, IP is not necessary.>>Hey, why not take it further: anyone with enough
sense to become an innovator doesn’t need property rights at all! Oh, wait, you define rights you disagree with as “privileges” that “violate others rights”, without realizing how you’re assuming your conclusion.Because I’m sane and not grasping at straws. Your non sequitur must be the result of some epistemological epiphany you had about “rights” which you forgot to publish, since you’re extending rights into the realm of the non-physical. I guess you should patent your method of non-persuasive argumentation since you have a comparative advantage at it and a seemingly endless productive capacity. - Drake
- @GreegoI agree with your main point, although I would state it in a slightly different way:When the nature of a resource limits its instantaneous use and demand for use exceeds this limit, some potential users are necessarily excluded. In other words, scarcity leads to exclusion by definition and without reference to rights.De facto private property arrangements emerge in environments where defense predominates over offense. These traditional arrangements are made explicit and standardized through consecration as “rights”.
- Silas Barta
- @Michael_Barnett:If I say you shouldn’t have the right to patent running-in-place, then obviously it’s logical to assume that owning particular wavelengths/frequencies of the electro-magnetic spectrum is ludicrous. Because, you know, they’re the same thing.You quite clearly said that it’s ridiculous to own “patterns of light”. Don’t even try to deny it; your previous post is there for all to see. Light AND radio waves are particular wavelengths of the EM spetrum (light is around 1 micrometer, radio on the order of 10 meters). So, one is ridiculous while the other isn’t?No, you don’t have to monopolize them, which I didn’t suggest anyway,Yes, you did; you just didn’t use that term. Look: “he can secure the resources which the production process requires, including such things as exclusive contracts or bidding up the price of the price of resources too high for competitors to come in from scratch.” Yes, it’s not a literal monopoly, but then, “monopoly” is generally used for near-monopolies anyway.By the way, what if lots and lots of consumers would pay lots and lots for a cure for cancer, but the money that can be made in the short initial period is less than the cost of development? I guess they’ll have to do without their cancer cure, no big deal.And how’s it supposed to work for books? Should I corner the ink market?
nor do you even have to take the lesser steps which I recommended in order to be an innovator. The facts, and pay attention here, THE FACTS are that people innovated long before the insidious IP fiction was ever perpetrated upon the masses. There was art, literature, music, scientific discovery, new technology, etc. before there was IP. Therefore, from even a strictly empirical point of view, which is what your entire argument rests upon, IP is not necessary.
WOW!!! Really? I totally was unaware of that history. Thanks *so much* for telling me about these things! Why, I must also be completely ignorant of my *own comments* on the issue, which I would make whether or not there was IP.
As usual, you’re not taking this far enough. Production of physical goods happens even without modern property rights, or in the presence of significant statist expropriation. So, are you going to argue that property rights and protection from statist exploitation are unnecessary as well? Didn’t think so.
Your non sequitur must be the result of some epistemological epiphany you had about “rights” which you forgot to publish, since you’re extending rights into the realm of the non-physical. I guess you should patent your method of non-persuasive argumentation since you have a comparative advantage at it and a seemingly endless productive capacity.
I notice you didn’t respond to the argument, nor probably even understand it. The debate is whether IP should exist. If it shouldn’t, then implementing it would indeed violate others’ rights. But you’re assuming it would violate others’ rights in proving that it should exist, which is circular.
- Dmitry Chernikov
- Silas, I think you are missing the point of Jeffrey’s argument. He writes that overall there are “hundreds if not millions of innovations per day. Our work lives, no matter what field we are in, are all about doing things better, bringing better products to the world…” So, the event of one person’s imitating the success of another is ubiquitous. It happens all the time and is perfectly good. To think that one can prevent this from happening is absurd. Moreover, the government apparatus that will be required to suppress every instance of such imitation will be so enormous as to destroy the economy. So, his argument is a reductio. It’s inconsistent to argue that I don’t have to pay my role model (or, e.g., some guy whose stock portfolio I decided to copy) yet do have to respect IP rights.What you would need to do is develop a theory of drawing a line somewhere which prohibits imitation in cases A, B, and C while allowing imitation in cases X, Y, and Z in a non-arbitrary manner.
- Hillshum
- @Rufus You hit the nail on the head by pointing out trademarks.Since only Hollister can put the word “Hollister” on clothes, they have a monopoly. Go to China and you’ll find Hollister quite cheap because of a lack of trademark law. Mr. Tucker’s Kleenex argument fails in that trademarks are key to Kleenex selling tissues. Some way of knowing if merchandise is from a reputable company is needed.
- Sasha Radeta
- I hope Mr. Tucker and the rest of the anti-IP crowd agree with following:#1) A person who purchases only limited use of someone’s work of authorship is liable for breach of contract if he violates those terms of use. These terms can stipulate that any unauthorized copies created by the purchaser of limited services become the property of the original owner.#2) If a third party (outside of contract) uses other person’s work of authorship without the owner’s expressed permission, he is committing a trespass and is liable for tort if an injury results from such unlawful action. We all agree that bona fide purchasers of unauthorized copies are not to be held liable for their actions. However, people who knowingly purchase unauthorized copies (property of copyright holder based on point #1) are liable for purchase of stolen goods.#3) Damages in tort are awarded generally to place the claimant in the position in which he would have been had the tort not taken place. Damages for breach of contract are generally awarded to place the claimant in the position in which he would have been had the contract not been breached. These are basic principles of justice, recognized for centuries by common law.As far as I could see, most of the anti-IP crowd does not dispute the fact that, for example, you only get a limited use of a CD or a book for $14.99, while the co-ownership of these items would cost you a heck of a lot more (that’s what publishers often pay). In other words, anti-IP crowd is disputing the current market price that is required to become the owner of a work of authorship — completely free from any restrictions imposed by the copyright holder. These people simply think the price is too high – so they want to force the owner to sell their merchandise at the price of its rent. This anti-property rights advocacy is hardly compatible with libertarianism or even with anarcho-capitalism as advocated by Murrray Rothbard (who was a great proponent of copyrights).A smaller number of anti-IP voices on this blog even tried to dispute the right of the owner to sell only the limited use of his good… However, these people could not offer a comprehensive definition of “ownership” that would prohibit such right — while still allowing human beings to sell their labor or rent their property.
Remember, according to Mises, “Ownership means full control of the services that can be derived from a good.” Any use of someone else’s property without its owner’s permission is trespass by definition. Some folks here tried to strictly limit what constitutes “using” or “deriving services” from a good — nevertheless, whatever your definition may be, most of the copyright violations occur when somebody picks-up and utilizes someone’s piece of property without owner’s consent.
- Hillshum
- You miss the point. If something is not your IP because not such thing exists, then if I take it I can’t have stolen it.
- Mike
- “#1) A person who purchases only limited use of someone’s work of authorship is liable for breach of contract if he violates those terms of use. These terms can stipulate that any unauthorized copies created by the purchaser of limited services become the property of the original owner.”This is in no way clear, and not how copyright actually works, but I’ll grant for the sake of argument that this sort of arrangement can be contractually reached.”#2) If a third party (outside of contract) uses other person’s work of authorship without the owner’s expressed permission, he is committing a trespass and is liable for tort if an injury results from such unlawful action. We all agree that bona fide purchasers of unauthorized copies are not to be held liable for their actions. However, people who knowingly purchase unauthorized copies (property of copyright holder based on point #1) are liable for purchase of stolen goods.”The term “using another’s work” is nebulous. If A agrees to B’s copyright of a book, then violates his contract and sells it to C, I’ll grant you that the book may rightfully belong to B. But if C then photocopies the book again, it is in no way clear that that second copy also belongs to B, since C was not party to the contract.Let’s look at it another way, one that avoids creative works, since you seem to be arguing for copyright as a contractual agreement rather than an exclusive right to a pattern. Say A sells B a hammer, under the condition that the hammer never be used to build a door. Any door that B builds with said hammer will become the property of A. A little bizarre, but nothing explicitly unlibertarian about the premise. Say, then, that B resells the hammer to C, but does not mention the “no doors” requirement. C builds a door with the hammer. A finds out about this and confronts C. “I’m sorry, but my agreement with B was that this hammer never be used to build doors. B’s attempt to sell the hammer to you was fraudulent, as he had no right to do so without first binding you into our no-doors agreement, as per our contract. The hammer rightfully belongs to me.” C agrees that this is just, returns the hammer, and intends to sue B for fraud. “Oh,” says A, “I’ll also need to take this door. That was part of our agreement too.”Does this seem like justice to you? A has binded C to a contract C never had any say in. The fact that C used A’s property without A’s permission means that C must return the property (plus damages if any were incurred) but does not entangle C into the debate between A and B.
“#3) Damages in tort are awarded generally to place the claimant in the position in which he would have been had the tort not taken place. Damages for breach of contract are generally awarded to place the claimant in the position in which he would have been had the contract not been breached. These are basic principles of justice, recognized for centuries by common law.”
It’s possible contracts could be arrived at that placed the first copier wholly responsible for the lost market share, but without the ability to pass these costs off to later copiers, I doubt anyone in their right mind would ever sign such a thing.
- newson
- to silas barta:
please refute this statement of mine –
“ip laws, on the other hand, cause a foreign body (the state) to intrude into the otherwise voluntary buyer/seller trading relationship.
no appeals to generalized welfare benefits can be made when the element of coercion is introduced.” - Silas Barta
- @Dmitry_Chernikov: No, I understood that argument just fine, and even responded to it in at least one of my comments on this very thread. My response was that yes, there are still these microinnovations with or without IP. But support for IP does not mean *every* innovation gets its protection. And without IP we miss out on those larger innovations that make everyone much better off. And there’s no “huge state apparatus” required: just as there can be private law enforcement, there can be private IP enforcement, funded by insurers a violators.@newson: You mean, refute it again? Like I just said to Dmitry_Chernikov above, state involvement is incidental. The state currently enforces property rights; that doesn’t mean it’s necessary or inherent to the existence of property rights.Furthermore, as anti-IP advocates seem to delete from their brains when discussing IP, the definition of what is voluntary relies on a prior justification of who owns what, which obviously can’t be used in an argument about who owns what, as that would be circular. If you agree that I own a car, taking it from me is not voluntary, but if it’s yours, then my possession of it is “involuntary” to you. Ditto the concept of “coercion”.So, in short, IP laws certainly don’t “require” the state any more than property laws, and you use a definition of “voluntary” that implicity assumes your conclusion.
- newson
- to silas barta:
you’re getting off message. your contention that ip gives huge pareto gains is unsustainable. there’s an internal contradiction.pareto gains can only occur in the context of free-trade in a state of anarchy. two individuals trade for perceived benefits, no one else is affected. coercion (be it from the state of some other party) necessarily means someone suffers disutility.please no more linking pareto gains with ip. stick to arguing that ip’s pros outweigh its cons. - Dmitry Chernikov
- Silas, it seems then that you are a defender of the status quo: according to you, the present IP laws are both necessary and sufficient for a happy society. Right?
- Silas Barta
- newson: I answered that already in my previous post. Just answer the reasoning presented there. I also have already showed you why:-IP doesn’t imply state enforcement of IP.
-The restriction you gave on when Pareto gains can occur is just wrong, and it assumes your conclusion.
-If IP rights exist, then certain transactions that are welfare enhancing are possible that are not possible in the absence of IP: a creator can create an idea and “sell” it, making himself better off as well as the people who have access to that idea. Without IP. the creator wouldn’t have the opportunity to make it, and the others would not be able to access the idea at all. So, that’s a clear example of how IP leads to a Pareto improvement.Dmitry_Chernikov: You must not have read a single thing I posted on this issue in order to conclude that. How on earth did you come up with that? - newson
- silas barta says:
“And there’s no “huge state apparatus” required: just as there can be private law enforcement, there can be private IP enforcement, funded by insurers a violators.”so why are you advocating for state-administered ip? - Silas Barta
- so why are you advocating for state-administered ip?I’m not.Any other words you want to put in my mouth?
- newson
- silas barta says:
“The restriction you gave on when Pareto gains can occur is just wrong…”how could coercion be compatible in any way with pareto gains? coercion must mean someone suffers. the state means coercion. so the state shaping a buy/sell transaction disqualifies it from being a pareto gain.checkmate. - Dmitry Chernikov
- Silas, I came up with that, because I suggested that you play the role of a law-giver and tell us how you would structure the IP laws, yet you did not seem to have responded (unless you did elsewhere). I mean, it really is fairly useless to have an argument between “pro-IP” and “anti-IP” people, as if this were a grand battle of totally incompatible ideologies. Perhaps a paper from you would be of interest.
- Silas Barta
- @Dmitry_Chernikov:Sorry, all I got out of that was, “No, I can’t substantiate the claim I just made up, but I bet I wrote more papers than you!!!!”Let me know when you have something substantive to add to this discussion.@newson: how could coercion be compatible in any way with pareto gains? coercion must mean someone suffers.You really don’t know?Okay, for starters, property rights involve coercing others not to use your property.See why the topic isn’t so simple, Rothdroid?
- newson
- silas barta says:
“Okay, for starters, property rights involve coercing others not to use your property.”defense of property is not coercive. coercion is the act of aggression. coercion annuls pareto improvement, because the interaction is not voluntary. someone must suffer. the state is coercive.ip codes enforced by the state preclude pareto gains/betterment/optimization/improvements.seems straightforward to me. - Stephan Kinsella
- Rufus, your argument that you can’t have a reputation without trademark law is very bad. I addressed it specifically in this post tonight: Trademark versus Copyright and Patent, or: Is All IP Evil?. Please read and educate yourself.Barnett’s comments were dead-on. He is of course correct that “the idea that someone can own patterns of language, light, sound, motion, text, shape, etc. is … ludicrous.”Think of it this way: the normal libertarian is in favor of rights to scarce resources, assigned in accordance with the Lockean first-use homesteading principle.IP-tarians believe there are rights in the way property is used. Thus, normal libertarians say that if I homestead a tract of land, I get to use it, and if someone else wants to, they need to get my permission. I’m the owner of that land. I can do whatever I want with it, so long as I’m not committing an act of aggression.IP-tarians, by contrast, say that if you are the first person to think of a way to use or arrange or pattern your own property then you now own that way-of-using-property across the whole universe. This is what it means to own a pattern, idea, information, etc. And it is of course incompatible with libertarian property rights, since it gives the owner sweeping rights to control how others use their already-owned tangible property. This is why it amounts to an undermining or transfer of property rights. Now this is so facially ridiculous and unjust that the IP-tards resist putting it this way, and evade and squirm and deflect and talk about radio spectra and fact that you can’t calculate without state-legislated monopolies and artificial scarcity, and so on.But this is what they are in favor of.
Thus, when Barnett astutely points out that: “Intellectual Property is a ridiculous fiction designed to impede competition by granting special ownership privileges to specific persons which interfere with the property rights of the masses,”
Silas, one of the leading amateur IP-tards gadflys (along with Sasha and ktibuk) retorts,
“Oh, and who happened to coincidentally be the sole reason that such a pattern is usable. (Hey, kinda like land homesteaders!)”
Silas here seems to assume that pattern-rights are what are the basis of real property too. But it’s not. It’s simply appropriating a previously unused resource, in such a way as to publicly mark it as yours–by transforming it by purposive use, embordering it, and so on. The right is not in a pattern, it’s a right to use the resource itself, grounded in the fact that the first user has a better claim by virtue of his first use than any other person, who is necessarily a latecomer with respect to him (and thus has to have an inferior claim). By contrast, your IP rights are rights in patterns, or in all ways-of-using property.
“Sasha,” returning from a welcome long absence, writes, “If a third party (outside of contract) uses other person’s work of authorship without the owner’s expressed permission, he is committing a trespass and is liable for tort if an injury results from such unlawful action. … people who knowingly purchase unauthorized copies (property of copyright holder based on point #1) are liable for purchase of stolen goods.”
The problem here is the IP-tard equivocates on what they mean by “use” and “property” and “good.” They sometimes use “property” and “good” to refer to the information or pattern itself, which is obviously question begging (though the IP-tards can’t see this, even though it’s obvious). Or, they just argue by definition, saying that if you (say) learn of the plot of a movie you have never seen then if you make a sequel, you are “using” the “plot” or the “property” of the original movie producer without permission. More question-begging.
If on the other hand the IP-tard here sticks to ownable, tangible things, then his argument falls apart–for the third party need never possess any piece of property owned by the author or inventor. For example if Lucas writes the Star Wars screenplay and loans it to Richard Harding on condition she not show it to anyone or tell anyone about it, and Person overhears Richard Harding blabbing about Obi-Wan and Luke Skywalker at a cocktail party, then Person is not trespassing against any property of Lucas’s if he makes a movie incorporating some of these ideas. The IP-tards cannot see that the only way to hold Person liable in this case is to assume that information is itself property, which is of course question-begging.
As to the comment that Mises’s “Ownership means full control of the services that can be derived from a good” supports IP–this is either taken out of context, or it’s mistaken. Businesses routinely have costs of exclusion. That’s the way the world works. Drive-in movie theaters had free-riders sitting outside, watching the movies for free. Ownership of the theater did not give them any “right” to get money from these freeriders. It did give them the right to remove the loudspeakers and replace them with little speakers for each car, even thogh this cost some money. If this cost had been too high, then the theaters would have had to suffer the loss, or come up with other ways to reduce the free rider drain. Or go out of business. That’s life.
- Stephan Kinsella
- Another perceptive comment of Barnett’s, that the IP-tards are “extending rights into the realm of the non-physical”.In what is a supreme case of irony, the IP-tards, who want to belittle the propertarians’ “fetish” with the “merely” physical, real, scarce world, to insist that that’s not “all” there is–that there are “ontologically” “many types” of things (see on this Objectivist Law Prof Mossoff on Copyright; or, the Misuse of Labor, Value, and Creation Metaphors and comments to Trademark and Fraud)–we can have property rights not only in mere base physical matter, but also in “other” things–other “types of” things–that we “create”, like poems, songs, novels, programs, ways of holding hands, ways of pinching on a multi-touch surface, and so on. And yet, and yet, though they want to treat this “higher realm” as equally (or, truth be told, more) deserving of legal protection as mundane physical property (that we don’t even create, after all, pshaw! we just find it, in fact, we are not responsible for the land value, so let’s have a Single Tax!)–though they act as if this pattern-realm is “just as” “real”, just as “deserving” of protection as the lowly physical realm–note that they are never content to enforce these lofty rights with lofty idea-force from the idea-realm. No–after denigrating those of us who restrict rights to scarce resources, to real, physical things, they themselves always, without fail, want to use real, physical force, against the real, physical bodies of infringers, to stop or punish them, or to extract from them real, physical monetary payments. A bit of hypocrisy and confusion there, eh?It reminds me of various mathematical transformations, as when electrical engineers shift to the “imaginary” realm to do various calculations, and then when done, we shift back to the real realm–but the difference is we don’t delude ourselves that this imaginary realm of imaginary numbers is real, or anything more than a convenient way to do calculations. The IP-tards for some reason get confused when thinking about the patterns we give our property–they can’t seem to realize that just because these patterns are what makes our property more useful or valuable does not mean there is a property right in the value or property (rather, it is in one’s property’s physical integrity); nor do they understand that just because imposing a certain configuration on your property, or using it in a certain way, is useful, does not give you the right to monopolize all such configurations or uses of any property in the universe.
- Gary Hall
- This is a really interesting discussion but it is clearly stated above the comment box to ‘Post an intelligent and civil comment’. Why, then, are there so many ad hominem attacks all over the place?I’m trying to learn something valuable and I find that I’m having to do a mental search-and-replace for terms that add nothing but vitriol to the discussion.
- Silas Barta
- Silas here seems to assume that pattern-rights are what are the basis of real property too.Wow, Stephan_Kinsella, of the few points of mine you addressed here, you couldn’t even get them right. In the part you were quoting, I was showing one similarity between the two rights, and it was because they were both pattern-rights. The point — which would be very simple to understand if you actually read those two lines — was that IP and property rights are similar in that the resource is usable specifically because of the actions of its homesteader. A land homesteader makes a resource usable by being the first one to use it, and the IP homesteader makes the idea available by being the first to instantiate it such that without him, no one would be able to use the resource.Please, try to respond to the *exact* arguments I make instead of the nearest match in your database.
- Silas Barta
- Oh, and just a friendly reminder:IP-tarians, by contrast, say that if you are the first person to think of a way to use or arrange or pattern your own property then you now own that way-of-using-property across the whole universe. This is what it means to own a pattern, idea, information, etc.Yes, and by this definition, Stephan_Kinsella counts as an IP-tarian because he believes in a right to a way-of-using-property, at least when it comes to EM spectrum rights.
- Drake
- @Gary HallWell said. This debate has been raging for a really long time, though. All considered, things have remained relatively civil, but I suppose a little more civility wouldn’t hurt.
- Drake
- @Silas BartaWhen the use of a resource is subject to an instantaneous limit, use by latecomers may deny use to homesteaders.The informational capacity of the EM spectrum in a given region is finite. When additional users broadcast on a spectrum already in use, they may deny current users of their continued use.What this has to do with intellectual monopoly is beyond me, but I very well may have missed something important.
- Silas Barta
- Yes, Drake, it is beyond you and you did miss something.Specifically, what is the connection between “informational capacity” and your rights? Why does the fact that the EM spectrum have informational capacity give you the right to stop others from broadcasting on it? Why does the justification of property reference “informational capacity”?Once you justify such a connection, you will see that the same argument can be used to justify IP. Give it a go.
- Drake
- @Silas Barta”Specifically, what is the connection between ‘informational capacity’ and your rights?”What is the connection between the fact that only one person can wear my hat at any given instant (cranial capacity) and my right to wear my hat at any given instant? If I am not to be excluded from wearing my hat whenever I want, others necessarily MUST be excluded from wearing my hat whenever they want. This is due to the nature of my hat and not the result of arbitrary theorizing.If we define property rights as the right to USE resources, exclusion only comes into play when use DEPENDS on it. In other words, I’m defining exclusion as a DERIVATIVE of the right to use, not a right unto itself. If the first broadcasters on an EM spectrum have a right to USE that spectrum, they may exclude others only if doing so is NECESSITATED by the nature of the spectrum itself (i.e. limited informational capacity).Feel free to try and use that argument to justify intellectual monopoly.
- Sasha Radeta
- Dr. Kinsella,thanks for taking time to respond:You say:
“they (IP-tards) sometimes use “property” and “good” to refer to the information or pattern itself, which is obviously question begging (though the IP-tards can’t see this, even though it’s obvious).“What about serious defenders of copyright, who never made such claim… Even in school, IP advocates always claimed that an idea cannot be copyrighted — only a real form of authorship (tangible and one that can be owned) can be subject to copyright.I’m not sure that even statists are so obsessed with “idea ownership.” To quote US copyright office:
“Only the actual expression of the author can be protected by copyright. The ideas, plans, methods, or systems described or embodied in a work are not protected by copyright. Thus, there is no way to secure copyright protection for the idea or principle behind a blank form or similar work or for any of the methods or systems involved in it.”Dr. Kinsella said:
“For example if Lucas writes the Star Wars screenplay and loans it to Richard Harding on condition she not show it to anyone or tell anyone about it, and Person overhears Richard Harding blabbing about Obi-Wan and Luke Skywalker at a cocktail party, then Person is not trespassing against any property of Lucas’s if he makes a movie incorporating some of these ideas.”Absolutely true! Copyright should not protect a movie not yet filmed. However, if you pick-up a Star Wars DVD, for which you only purchased some limited use (paying $14.99 instead of millions for co-ownership rights) — than we have a violation of free-market contract. Even if you find that DVD on a sidewalk, you still don’t become co-owner of that valuable property. That’s all.
“Businesses routinely have costs of exclusion. That’s the way the world works. Drive-in movie theaters had free-riders sitting outside, watching the movies for free.
It’s their choice of profession Dr. Kinsella… some business models just work like that. Some young bands give their music online for free as a way of promoting their future albums and concerts. Some authors provide free online access for their books, just to make more money from people who like to read classic, paper editions… But that business model does not work for everyone, and it surely does not disprove anything I said about free-market copyright protection.
You may claim that Mises’s definition is taken out of context, but in whatever context you place it, basic truth still holds:
“Ownership means full control of the services that can be derived from a good.”You may limit the scope of what “services derived” means… but however you define it, copyright protection still holds for two reasons:
– Authors have an unalienable right to sell only limited use of their works, thus limiting many things you can do with their works (including replications)
– Authors can sue for damages if a third party (a non-customer) ever picks their work and uses it in a way that causes economic injury to them.In other words, you by arguing with “IP tards,” you completely miss the entire point of copyright, while unintentionally misrepresenting what the authors would be able to do in a completely unhampered free market.
Best regards.
- Sasha Radeta
- Mike,you misread what I wrote. Every owner of a work of authorship has a right to form a contract with another party, in which they would agree that any unauthorized copies will become the property of copyright holder. If a third party knowingly purchases bootleg copies (that are now legally property of the copyright holder) — he is in fact purchasing stolen goods and he will use other person’s property without owner’s approval.I made a clear and fine distinction between copyright violation made by those who purchase only a “limited use” of a work of authorship — and those who simply trespass (use it without owner’s permission). However, implied contract is enough to protect copyrights. If ownership by definition means the right to control services that can be derived from a good, that would include any unauthorized copies as well… Any other definition of ownership rights would be absurd. However, I chose not to expand this argument, because i already covered it here:http://blog.mises.org/archives/009365.aspBest regards.
- Stephan Kinsella
- Silas Barta:
“Silas here seems to assume that pattern-rights are what are the basis of real property too.”
Wow, Stephan_Kinsella, of the few points of mine you addressed here, you couldn’t even get them right. In the part you were quoting, I was showing one similarity between the two rights, and it was because they were both pattern-rights. The point — which would be very simple to understand if you actually read those two lines — was that IP and property rights are similar in that the resource is usable specifically because of the actions of its homesteader. A land homesteader makes a resource usable by being the first one to use it,
This is not true, and not a relevant similarity. It’s not true because a resource has to be usable already for someone to use it. What the homesteader does by appropriating it is simply become the first to use it. By doing this he establishes a connection with the resource that gives him a better claim to it than anyone else, since all other potential claimants are latecomers with respect to the homesteader. I explain this in How We Come to Own Ourselves.
and the IP homesteader makes the idea available by being the first to instantiate it such that without him, no one would be able to use the resource.
There are so many problems with your reasoning it’s hard to know where to start. If you would try to come up with a coherent, positive account of rights your errors would be glaringly obvious. But: first: the analogy is terrible, first, as I noted above, because “making a resource usable” is NOT what the homesteader does, NOR is it why he is its owner. Second, in the case of scarce resource we have something that is subject to property rights; and as it’s previously in an unowned state, the question is when it becomes owned and who is the owner (the first user has a better claim than latecomers, is the libertarian view). IP is not a scarce resource and not a homesteadable thing in the first place; to assume it is is at best question-begging. So, third: the IP “homesteader” is not a homesteader at all.
And fourth: the “IP homesteader” does not “makes the idea available by being the first to instantiate it such that without him, no one would be able to use the resource” — in the case of patents, for example, the patent right exists even when the guy is not the first inventor, even when others invent it independently, even when the idea’s “time had come” so that it would have been invented by others. In this case, you can’t say that without the innovation no one would have been able to use it. Either you don’t understand the IP right you defend, or you are defending some alternate theory of IP that you don’t know how to articulate. This is typical of IP advocates. The primary ones who know what they advocate are IP lawyers and they are blatantly, cynically biased and self-interested. Now, you’ll do the typical IP-tard dance and say, “oh, no, we don’t advocate THAT”–every time we point out one of the many injustices of IP you crawfish and wiggle out of that. You pretend not to favor any of the obvious injustices that are inherent in any patent system, leaving us to wonder waht you do favor; but you have no idea what you favor and can’t articulate it.
Fifth: Even if it were true that without a pattern creator others would not be able to use that pattern–so what? From this it does not follow that he has a right to prevent them from using their property in a way they have learned from others. You are against learning, Silas.
Sasha Radeta:
You say:
“they (IP-tards) sometimes use “property” and “good” to refer to the information or pattern itself, which is obviously question begging (though the IP-tards can’t see this, even though it’s obvious).”What about serious defenders of copyright, who never made such claim… Even in school, IP advocates always claimed that an idea cannot be copyrighted — only a real form of authorship (tangible and one that can be owned) can be subject to copyright.
I don’t konw exaclty what you mean. If they claim that putting a pattern on their own property gives them a right to prevent others from putting similar patterns on their property, then that has the same flaws. If they don’t, they are not advocating IP.
“For example if Lucas writes the Star Wars screenplay and loans it to Richard Harding on condition she not show it to anyone or tell anyone about it, and Person overhears Richard Harding blabbing about Obi-Wan and Luke Skywalker at a cocktail party, then Person is not trespassing against any property of Lucas’s if he makes a movie incorporating some of these ideas.”
Absolutely true! Copyright should not protect a movie not yet filmed.
this comment is typical of the IP advocates. You must be unaware of what copyright is–it’s a bundle of rights, including “derivative rights.” So you seem here to now object to derivative rights being included in copyright. Fine by me–this denudes the notion of coyright down to a wisp of itself–and trust me, your fellow IP advocates will go nuts objecting to your (presumed) proposal to eviscerate it this way.
You guys are just confused about the monstrous and complex law you endorse. You want to have it both way.s. You want to object to the bad parts, all the manifest injustices we point out, yet maintain a pretense of defneding *some* IP shell that is left, without specifying what the hell it is. Must we catalog every single injustice of IP law, and get you to grudgingly conceded this, too, is bad, until we eradicate it all? Can we not think in principle?
However, if you pick-up a Star Wars DVD, for which you only purchased some limited use (paying $14.99 instead of millions for co-ownership rights) — than we have a violation of free-market contract. Even if you find that DVD on a sidewalk, you still don’t become co-owner of that valuable property. That’s all.
But that doesn’t get you there. Unless you ensnare third parties, IP falls apart. It can’t get off the ground. So if you don’t suggest this, then you are not supporting IP law.
“Businesses routinely have costs of exclusion. That’s the way the world works. Drive-in movie theaters had free-riders sitting outside, watching the movies for free.
It’s their choice of profession Dr. Kinsella… some business models just work like that. Some young bands give their music online for free as a way of promoting their future albums and concerts. Some authors provide free online access for their books, just to make more money from people who like to read classic, paper editions… But that business model does not work for everyone, and it surely does not disprove anything I said about free-market copyright protection.
The point is that the existence of free riders does not prove anything. The fact is that businesses have to deal with this by creative exclusion techniques. Not by state-legislated artificially created scarcity rights.
– Authors can sue for damages if a third party (a non-customer) ever picks their work and uses it in a way that causes economic injury to them.
The problem here is that information is not always connected to a particular scarce resource, so that it’s easy for information to get into the public domain. Then you cannot stop it. Like us real libertarians, information wants to be free. We have no right to stop learning, the spread of information, and emulation. Nor should we want to–emulation and konwledge and learning are good.
In other words, you by arguing with “IP tards,” you completely miss the entire point of copyright, while unintentionally misrepresenting what the authors would be able to do in a completely unhampered free market.
I happen to have a very good understanding of what copyright law and patent law are. I also know what the arguments in favor of it are. They are mostly unprincipled and utilitarian; or they are insane and unhinged, like Randian and Galambosian arguments.
If you support that kind of copyright, you are wrong. If you support something else, then don’t call it copyright.
- Sasha Radeta
- Dr Kinsella,you still haven’t addressed real issues here… If an author can contractually prevent his consumers from replicating his work of authorship — while at the same time get protection from unauthorized use (trespass) by non-customers — you are in fact admitting that copyright (yes, copyright) would exist under completely unhampered free market.If you deny the very definition of copyright and you would rather argue with “IP tards” — please continue without me.Best regards.
Published: February 10, 2009 4:16 PM
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And, as usual, I could go through your blog post and do the same substitution on the rest, including worrying about the “necessary bureacracy” that physical property rights creates.
This is getting tiresome, it really is.
Published: February 10, 2009 4:47 PM
And, as usual, I could go through your blog post and do the same substitution on the rest, including worrying about the “necessary bureacracy” that physical property rights creates.
This is getting tiresome, it really is.
Published: February 10, 2009 4:48 PM
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i still can’t understand why you appeal to pareto-neutrality in presenting your arguments. this is austria, not chicago.
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rothbard’s “Toward a Reconstruction of Utility and Welfare Economics” is the refutation you’re looking for.
http://mises.org/rothbard/toward.pdf
Published: February 10, 2009 6:57 PM
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“The errors of psychologizing and of behaviorism have in common a desire by their practitioners to endow their concepts and procedures with “operational meaning,” either in the areas of observed behavior or in mental operations.Vilfredo Pareto, perhaps the founder of an explicitly positivist approach in economics, championed both errors. Discarding a demonstrated preference approach as “tautologous,” Pareto, on the one hand, sought to eliminate subjective preferences from economics and, on the other, to investigate and measure preference scales apart from real action. Pareto was, in more ways than one, the spiritual ancestor of most current utility theorists.”please indicate which austrians endorse pareto optimality. the term is clear and easily understood; i don’t see any austrians endorsing it under a different moniker.
Published: February 10, 2009 9:35 PM
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here’s another bit by ray cordato which helpfully shows what tripe pareto analysis is:“The Austrian case against the standard Pigouvian approach has been argued (Cordato 1992a and 1995) and will not be recounted in any detail here. But in order to understand the genesis of the alternative, the core problems with the standard approach need to be made explicit. These problems can be summarized as follows:1. Efficiency is a “praxeological,” i.e., individual goal seeking problem, not a value maximization problem. From a policy perspective, then, social efficiency is assessed in terms of the extent to which legal institutions facilitate consistency between the ends that actors are pursuing and the means that they are choosing to accomplish those ends.2. Costs are subjective and therefore social costs and social value, as the terms are typically construed, do not exist as either measurable or even theoretical concepts. The standard approach is dependent upon being able to measure and therefore make objective these concepts. For example, the standard approach to environmental economics depends on being able to identify situations where the marginal private benefit of an activity exceeds the marginal social cost. This inherently involves making interpersonal utility comparisons and the summing of interpersonal evaluations across individuals. Neither of these can be held as methodologically valid.3. Pareto optimality, i.e., the perfectly competitive general equilibrium, is irrelevant as a real world efficiency benchmark. This is largely because of the implications of 1 and 2. Because human action takes place through time, with knowledge and therefore supply and demand for inputs and outputs constantly changing, the particular Pareto optimum for any point in time is irrelevant. Strict adherence to subjective value and therefore subjective cost theory also leads to the rejection of Pareto optimality as a normative benchmark. Outside of a framework of unanimity it is impossible to talk about Pareto superior changes to a given state of the world without invoking interpersonal cost/benefit analysis.over to you…
Published: February 10, 2009 11:07 PM
Published: February 10, 2009 11:28 PM
…so through the austrian looking-glass, pareto-optimality is a useless construct.
Published: February 11, 2009 12:42 AM
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The government has also acknowledged that he was detained without trial in 1846 for 18 months. Concerns have grown recently at the inappropriate use of the Haka for commercial purposes.”
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Pointing to light bulbs that have been changed (or other examples like CC music or Open Source software) does not affect the economic argument in any way, because it wasn’t predicting that nobody changes these light bulbs. It predicts, light buld changes will occur more often, when there are incentives to do so, similar to faster growth of plants when given fertlizer.
Published: February 11, 2009 7:57 AM
Published: February 11, 2009 8:23 AM