The Purpose of Law: Justice and Property Rights vs. IP Rights and Optimizing Innovation

by Stephan Kinsella on May 22, 2026

From various posts at C4SIF.org and StephanKinsella.com:

I tire of people repeating over and over again that we need IP because without it there would be no innovation, etc. I have pointed out to them over and over that not only is this false,¹ but that it misconceives the purpose of law itself. It imagines that there are market failures and imperfections,² such as “holdout problems” and “free riders,”³ and “too much competition,⁴ and that the state is therefore justified in intervening–in engaging in what are in effect takings—in attempt to grow the size of the pie. Of course this never works because (a) there are no market failures, (b) even if there are, they are dwarfed by political failure, i.e. the solution is worse than the problem. But it also assumes that if the state could intervene and make things “better” in some vague sense, that this is justified. But this misconceives the purpose of law: it is is to do justice—by recognizing, identifying, defining, respecting, and protecting property rights.⁵ IP law violates property rights;⁶ it is the opposite of justice. It is a perversion of law and justice.

Here are some passages from various posts at C4SIF.org and StephanKinsella.com touching on this:

The Problem with Intellectual Property:

The purpose of property rights is to support actors in the pursuit of their goals by enabling them to employ resources, including their own bodies, free of physical conflict and interference from other actors. Property rights are inherently practical. For this reason legal systems and their corresponding property rights from time immemorial have always exhibited certain core features in the private law, to one degree or another: self-ownership, original appropriation, contractual transfer, and transfers for rectification.

… The goal of law is justice, not maximizing utility.⁷ This is done by identifying and protecting property rights. This is because justice is just giving someone his due—and what he is due depends on what his rights are.

Stephan Kinsella, “Preface,” in Legal Foundations of a Free Society (Houston, Texas: Papinian Press, 2023):

The issue of what property rights we have, or should have, what laws are just and proper, has long confronted mankind, and continues to be the subject of debate today. This book seeks to address these issues, with an approach that keeps in mind the nature and reality of human life—that we are purposeful human actors living in a world of scarcity and facing the possibility of interpersonal conflict—and the purpose of law and property norms: to enable us to live together, in society, peacefully and cooperatively. The goal is to vindicate the private law as developed in the decentralized systems of the Roman and common law, with an emphasis on consistency, principle, and the inviolable rights of the individual. In short, to argue for a private law system informed by libertarian principles.

Stephan Kinsella, “How We Come To Own Ourselves,” in Legal Foundations of a Free Society (Houston, Texas: Papinian Press, 2023):

… the “first use” rule is merely the result of the application of the more general principle of objective link to the case of objects that may be homesteaded from an unowned state. Recall that the purpose of property rights is to permit conflicts over scarce (rivalrous, conflictable) resources to be avoided.⁸ To fulfill this purpose, property titles to particular resources are assigned to particular owners. The assignment must not, however, be random, arbitrary, or biased, if it is to actually be a property norm and possibly help conflict to be avoided. What this means is that title has to be assigned to one of the competing claimants based on “the existence of an objective, intersubjectively ascertainable link between owner and the” resource claimed.⁹

Thus, it is the concept of objective link between claimants and a claimed resource that determines property ownership. First use is merely what constitutes the objective link in the case of previously unowned resources. In this case, the only objective link to the thing is that between the first user—the appropriator—and the thing. Any other supposed link is not objective, and is merely based on verbal decree, or on some type of formulation that violates the prior-later distinction. But the prior-later distinction is crucial if property rights are to actually establish rights and make conflict avoidable. Moreover, ownership claims cannot be based on mere verbal decree, as this also would not help to reduce conflict, since any number of people could simply decree their ownership of the thing.¹⁰

So for homesteaded things—previously unowned resources—the objective link is first use. It has to be, by the nature of the situation.

… But for human bodies, matters are somewhat different.

On the Obligation to Negotiate, Compromise, and Arbitrate:

… when we are considering property rights and laws, and the administration of justice, again we must be informed by the very purpose of property rights: to reduce conflict in order to make peace, trade, and cooperation possible.

Libertarian Answer Man: Do Corporations have “Privileges”?:

I suppose if you have blinkers on you can say some state action lowers some costs, but of course, this is at expense of other costs that inevitably come with the existence of the state; nothing is for free. And anyway the purpose of law is not to run around looking for market failures to “fix” or transactions costs to lower; it is to do justice by recognizing, identifying, and protecting just property rights.¹¹

***