The latest issue of Theoretical Inquiries in Law has several interesting pieces on the theme “Copyright Culture, Copyright History,” including:

Copyrights as Incentives: Did We Just Imagine That?

Diane Leenheer Zimmerman

Abstract

The most widely accepted explanation of why we need copyright is that it provides authors with the necessary economic incentive to create. This incentive story has largely gone unchallenged, and has been used to justify lengthening and strengthening the legal protections for expressive works. This Article points out, however, that the empirical foundation for the copyright-as-incentive story is seriously suspect. It fails to account for the economic conditions under which most art, literature and other expressive works are produced, and it contravenes the insights provided over the last forty years or so by psychologists interested in creativity and by behavioral economists. Empirical research has shown that intrinsic factors are much more important determinants of participation in creative work than such extrinsic ones as monetary reward. In fact, evidence exists that the promise of extrinsic rewards such as money can actually be detrimental to the creative impulse. This is not to say that concern with economic rewards should play no role in a legal regime designed to encourage the creative process. But, at a minimum, this Article suggests both that copyright scholars (and possibly patent ones as well) need to develop a far more nuanced understanding of why people produce what they do, and that a satisfactory legal regime to promote intellectual property creation and dissemination can afford to be far less concerned than it presently is with ensuring that authors and copyright owners can extract every bit of available profit from their works.

Recommended Citation

Zimmerman, Diane Leenheer (2011) “Copyrights as Incentives: Did We Just Imagine That?,” Theoretical Inquiries in Law: Vol. 12 : No. 1, Article 3.
Available at: http://www.bepress.com/til/default/vol12/iss1/art3

and

Bollywood/Hollywood

Madhavi Sunder

Abstract

Free flow of culture is not always fair flow of culture. A recent spate of copyright suits by Hollywood against Bollywood accuses the latter of ruthlessly copying movie themes and scenes from America. But claims of cultural appropriation go far back, and travel in multiple directions. The revered American director, Steven Spielberg, has been accused of copying the idea for E.T. the Extra-Terrestrial from legendary Indian filmmaker Satyajit Ray’s 1962 script, The Alien. Disney’s The Lion King bears striking similarities to Osamu Tezuka’s Japanese anime series, Kimba the White Lion. Neither Ray nor Tezuka’s studio sued the American filmmakers and this Article is by no means an attempt to revive any particular legal case. Rather, this Article considers copyright’s role in promoting free cultural exchange, albeit on fair terms in a global marketplace of ideas marked by sharp differentials in power, wealth, and knowledge.

Recommended Citation

Sunder, Madhavi (2011) “Bollywood/Hollywood,” Theoretical Inquiries in Law: Vol. 12 : No. 1, Article 10.
Available at: http://www.bepress.com/til/default/vol12/iss1/art10

The full contents of this issue is:

Copyright Culture, Copyright History

Introduction

Copyright and Truth

Maurizio Borghi

Copyrights as Incentives: Did We Just Imagine That?

Diane Leenheer Zimmerman

Copyright as Tort

Avihay Dorfman and Assaf Jacob

What Is a Copyright Work?

Brad Sherman

Copyright and Social Movements in Late Nineteenth-Century America

Steven Wilf

The “Extraordinary Multiplicity” of Intellectual Property Laws in the British Colonies in the Nineteenth Century

Lionel Bently

Hebrew Authors and English Copyright Law in Mandate Palestine

Michael D. Birnhack

Is Copyright Property? — The Debate in Jewish Law

Neil W. Netanel and David Nimmer

Bollywood/Hollywood

Madhavi Sunder

Tailoring Copyright to Social Production

Niva Elkin-Koren

Global Intellectual Property Governance (Under Construction)

Margaret Chon

An Old-Fashioned View of the Nature of Law

James Boyd White

From the Mises blog; archived comments below.

Update: See Classical Liberals, Libertarians, Anarchists and Others on Intellectual Property and this facebook post: 

“Protection from entrepreneurial competition does not provide any spur to entrepreneurial discovery.”

– Israel Kirzner 👀

— Foundation for Economic Education (@feeonline) August 14, 2025

“Protection from entrepreneurial competition does not provide any spur to entrepreneurial discovery.” Kirzner, Discovery and the Capitalist Process (1985), p. 38

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I’ve noted before the views of Austrians such as Mises, Hayek, and Rothbard on IP.¹ They would be placed in phase 3 of The Four Historical Phases of IP Abolitionism.

In my post Mossoff: Why Should Business Leaders Care About Intellectual Property (Objectivism), I noted Sheldon Richman had relayed to me an interesting exchange between Roy Cordato and the pro-IP Adam Mossoff:

Mossoff recently appeared on an IP panel at the recent APEE annual meeting, along with several anti-IP libertarians, including Sheldon Richman (I believe Roderick Long was present too but I am not sure if he was on that panel). The panel also had Ed Lopez who offered efficiency arguments against IP but was not much part of the debate. Richman related to me that at one point, Roy Cordato asked Mossoff if IP would protect a Kirznerian entrepreneur who has a novel insight about the gap between the cost of inputs and the price of an output. At first Mossoff said he didn’t know what a Kirznerian entrepreneur was (Cordato explained), then he didn’t get the point (thinking Cordato meant the actual product rather than the idea about the gap between costs and price), then ended up saying that the idea would be patentable–which means the law would stop market equilibration, since others could not jump in and imitate the entrepreneur.

This got me curious about Cordato. Sure enough, in his 1992 book Welfare Economics and Externalities in an Open Ended Universe, he has several passages indicating a skepticism of IP. On pp. 21-22, he discusses the difference between Mises and Rothbard on patent and copyright; see also p. 36 (“If an external benefit “problem” arises that is the result of ambiguously defined entitlements, then some form of public policy which focuses on establishing those rights may be advocated. The sole example of this in the literature is Mises’ discussion patent and copyright laws”). On p. 80:

Mises has suggested, though, that an external benefit “problem” might arise where intellectual property rights are not clearly defined; this is the issue of patents and copyrights (see chapter 1). Mises clearly focuses on an issue of property rights that may have normative implications for catallactic efficiency. Ambiguities with respect to entitlements in the area of inventions and the generation of ideas can lead to interpersonal conflicts in the plan-formulation and goal-seeking process. As noted, to efficiently make plans, individuals need to know that their rights to use the relevant property will be upheld at pertinent points in the future. The issue of patents and copyrights may be an application of this principle.

On the other hand, this is clearly an area where the limitations of economic analysis are exposed and a theory of justice may need to be invoked. Consistent with O’Driscoll and Rizzo’s point, this is a case where certain ethical questions need to be resolved before economic analysis can be applied. The question of whether property rights can legitimately be applied to ideas, particularly given that ideas and inventions can be and often are independently discovered, has both practical and ethical implications. In such cases, the granting of property rights to a discovery itself denies the rights of others who have made or will make the same discovery independently (Rothbard 1970, p. 71). This denial of rights would clearly interfere with plans that were made by the independent discoverer and may consequently have a negative impact on the accuracy of some market prices. This suggests that the granting of property rights to ideas would likely lead to its own problems with respect to catallactic efficiency.6 Mises’s brief analysis, providing neither a theory of justice nor efficiency, does not give us a satisfactory approach to this issue. [continue reading…]

1. On Hayek: see Tucker, “Misesian vs. Marxian vs. IP Views of Innovation“; Tucker, “Hayek on Patents and Copyrights” (archived comments). On Mises, see Human Action 3rd rev. ed. Chicago: Henry Regnery (1966), chap. 23, section 6, pp. 661–62; see also pp. 128, 364; see also Kinsella, “Mises on Intellectual Property“. Rothbard: Knowledge, True and False and Man, Economy, and State and Power and Market, Scholars Edition, pp. liv, 745-54, 1133-38, 1181-86. [↩]

I noted in Supreme Court Prepares to Chop Down “Clear and Convincing” Standard for Proving Patent Invalidity that the Supreme Court had agreed to hear the appeal of the Microsoft Corp. v. i4i Ltd., case. In this case, i4i sued Microsoft for patent infringement and was awarded a $290M judgment, based on Microsoft’s use of XML in Word.

At issue here is the burden of proof Microsoft needs to satisfy to prove i4i’s patents invalid. As I previously explained, my hope is that Microsoft wins–they have argued to lower the standard of proof needed to invalidate a patent. This would be a minor change, but in the right direction. The Court heard oral arguments in this case earlier this week; they are summarized here. It’s hard to be sure what the Court will do but my impression is they will probably side, at least partially, with Microsoft.

From Reuters: Apple sues Samsung over Galaxy products: for “copying” the iOS devices.

Disgusting and horrible. This is the use of the state to stop competition.

Update:  Samsung strikes back at Apple with ten patent infringement claims

–a good example of why companies are forced to acquire an arsenal of patents for defensive purposes.

See also Apple: Patent Crybaby

Mises post; archived comments below.

Update: See “Intellectual Property Is ‘Evil’—And Businesspeople Should Oppose It,” interview with Jack Criss, BAMSouth (Oct. 29, 2013)

***

As I’ve noted before, with the rise of IP abolitionism among libertarians, with IP defenders on the ropes, the Objectivists are trying to strike back. Rand’s defense of IP was incoherent, confused, and never complete (her brief argument assumed the US patent system is first to file, which is incorrect; and she had an incoherent admixture of utilitarianism and intuitionism in her tortured attempt to defend a finite, arbitrary term for patent and copyright).

Modern defenders such as Greg Perkins and law professor Mossoff are attempting to put her IP views on a sound footing.¹

One thing ironic about this is Rand put so much stock into the importance of IP–she said ““patents are the heart and core of property rights,”² she told a patent attorney that “Intellectual property is the most important field of law,”³ and Mossoff claims that “All Property is Intellectual Property”. Well if IP is that important, if it’s the base of her whole system, but if she only devoted one brief and confused essay to it, and if her followers are still struggling to rehabililate and flesh her views out on IP (in the presentation I’ll discuss below, Ayn Rand Institute President Yaron Brook says he will participate in the Q&A even though “I don’t know anything about intellectual property”), how can Objectivism be a comprehensive, complete, and closed system? Surely its claims to completeness are suspect if its very foundations are IP and those foundations are still in need of shoring up?

In any case, GMU Objectivist law professor and Adam Mossoff is putting a lot of effort in trying to come up with a coherent defense of IP.⁴ In a lecture last November, “Why Should Business Leaders Care about Intellectual Property?—Ayn Rand’s Radical Argument,” Professor Mossoff (joined by ARI head Yaron Brook in the Q&A) attempts to defend IP based on Objectivist principles.

The attempt fails completely, because it is riddled with confused arguments and non-sequiturs, so many that it’s hard to know where to begin. I started keeping notes but could not keep up, so I will only make a few observations based on what I did jot down.

[continue reading…]

1. See Objectivists Hsieh and Perkins on IP and Pirating Music; Objectivist Greg Perkins on Intellectual Property; Perkins on Pursuing Insufficiently Abundant Intangible “Values”; Objectivist Law Prof Mossoff on Copyright; or, the Misuse of Labor, Value, and Creation Metaphors; Kinsella v. Schulman on Logorights and IP; Objectivists: “All Property is Intellectual Property”; Pledge for a Webcast on Intellectual Property by Adam Mossoff; Hsieh and Mossoff on IP and Sewing Machines. [↩]
2. See Rand on IP, Owning “Values”, and “Rearrangement Rights”. [↩]
3. Inventors are Like Unto …GODS…. [↩]
4. See, e.g., Pledge for a Webcast on Intellectual Property by Adam Mossoff; and his paper Who Cares What Thomas Jefferson Thought About Patents? Reevaluating the Patent ‘Privilege’ in Historical Context. [↩]

Kevin Carson, in America’s Peculiar Institution, on C4SS.org (referring to stories mentioned in Homeland Security Mission Creep: “Intellectual Property Crime”):

“Intellectual property” is enforced by special FBI task forces, one of them run out of Disney headquarters, closely coordinating their actions with the Motion Picture Association of America. Internet service providers are enlisted as junior G-men, spying on their customers on behalf of digital content “owners.” See if you can get that kind of zeal and diligence from the cops if mere tangible property like your car is stolen.

Well, actually there is a precedent:  The authoritarian police apparatus that grew up around the task of reclaiming runaway “property” under the rules of that other peculiar institution, back in the 1850s.

Both peculiar institutions, yesterday and today, were on the wrong side of history. Human beings want to be free.  Information wants to be free. All laws to the contrary will fail in the end.

As mentioned in my post The Best Introduction to Libertarianism Ever, attorney and legal scholar Jacob Huebert has written a fantastic introduction to the modern libertarian movement. His chapter “The Fight against Intellectual Property” is also one of the best, most concise presentations of the libertarian case against IP I’ve ever read.

It’s no surprise, then, that Huebert’s performance in a recent IP debate at Whittier Law School is superb–this is just a great presentation (audio). His opponent gave it a good shot but really had no coherent argument to mount in favor of IP at all. It just goes to show you, there are no good argument for IP; this is why pro-IP libertarianism is on its death bed.

(See also Huebert’s wonderful recent Mises Circle talk, “Is There Hope for Liberty in Our Lifetime?”.)

Given this review of the movie Atlas Shrugged: Part I by Katelyn Horn, I’m expecting it to be barely watchable, at best. My plans to go see it this weekend are now shelved; it’ll be a rental.

I suspect one reason for deficiencies in the film adaptation lie in the fact that the production was rushed, in order to keep the film rights from expiring. Apparently the producer approached Peikoff for an extension but it was denied. So, the film had to be rushed into production to avoid the rights expiring, leading to an unsurprising impact on quality. Absent copyright, of course, this would not have happened and a good sequel would likely have been made decades ago. As this review on Prometheus Unbound by Matthew Alexander notes:

part of the problems with the movie derive from the fact that the man who owned the rights to the story was nearing the end of his term and so threw the movie together before his rights expired. Intellectual property — that foe of artistic creativity, which had a friend in Ayn Rand, has played a role in diminishing her work as it went to the silver screen. Make of that what you will; I merely point it out and pass on.

“Unlike contracts, copyrights and the rights flowing therefrom are entirely creatures of statute….” (Microsoft Corp. v. Grey Computer, 910 F.Supp. 1077, 1084 (D.Md.1995), quoted in Silvers v. Sony Pictures Entertainment, 402 F.3d 881 (2005))

Like all other natural rights, which are also “creatures of statute,” right?

Yet another example of IP-caused censorship/thought control. (H/t Mike Reid) Reminds me of this quote:

“Of all tyrannies, a tyranny sincerely exercised for the good of its victims may be the most oppressive. It would be better to live under robber barons than under omnipotent moral busybodies. The robber baron’s cruelty may sometimes sleep, his cupidity may at some point be satiated; but those who torment us for our own good will torment us without end for they do so with the approval of their own conscience. … This very kindness stings with intolerable insult. To be ‘cured’ against one’s will and cured of states which we may not regard as disease is to be put on a level of those who have not yet reached the age of reason or those who never will; to be classed with infants, imbeciles, and domestic animals.” –C.S. Lewis

***

Google to sentence YouTube violators to ‘copyright school’

Google’s updated policies are intended to better educate users. | Reuters Photo Close

By JENNIFER MARTINEZ | 4/14/11 9:04 AM EDT Updated: 4/14/11 11:58 AM EDT

I listen to a lot of podcasts; my favorites include Slate’s Culture Gabfest and Political Gabfest, and TWiT‘s This Week in Tech and MacBreak Weekly. A new favorite is the TWiT network’s Triangulation. Leo Laporte and Tom Merritt do in-depth interviews with interesting tech people, such as Ray Kurzweil, Stephen Wolfram, and Michael Geist. The most recent Triangulation has a great interview with sci-fi author Cory Doctorow. Cory is on the forefront of finding ways to profit in the world of digital and networked media. One of his experiments involves selling or giving away ebook versions of a book and selling a $250 fancy hand-stitched hardback that includes an actual page of a manuscript from one of several notable author friends of Cory’s who donated those to him for this purpose.

Another idea he had is also interesting. For his books that he self-publishes, he asks for donations too. But for ones that use a publisher, he feels asking for a donation would be unfair–a way of getting around the publisher’s right to a cut. So what he does is this. First he solicits requests from libraries etc. for hardback copies of his books. He then compiles a list of people who need a free hardcopy of his books. Then, he gives away ebooks but asks anyone who downloads it for free, and who does not want a hard copy, but who wants to make a donation, to fund the purchase of a hard copy for one of the deserving libraries on his list. So that way the ebook consumer gets to buy the book which goes to a library, the publisher is happy, and Doctorow gets his royalty. Innovative!

Doctorow also has great comments about the viability–or lack thereof–of DRM etc. As he points out, if you lock up computers, encrypt and DRM files, you make your work hard to find, more obscure. And he says, while it may be difficult to find ways to profit off of your fame, no one can make  a profit off of obscurity. So it’s better to open things up and realize piracy is here and find a way to coexist with it, since the alternative is obscurity.

See also Innovations that Thrive without IP.

This is included as ch. 5 of Stephan Kinsella, ed., The Anti-IP Reader: Free Market Critiques of Intellectual Property (Papinian Press, 2023).

***

Mises post; Archived comments below.

In my post The Origins of Libertarian IP Abolitionism, I discussed the origins of the modern libertarian anti-IP movement. I’ve learned a lot more about the antecedents and history of all this from teaching the Mises Academy course “Rethinking Intellectual Property: History, Theory, and Economics.” This history if very interesting. It seems to me we can mark at least four periods of significant and vigorous debate about IP that included strong arguments against IP, which I set forth below.

1. The Anti-patent movement from 1850–1873

Machlup¹ lays out four historical periods leading to the modern patent systems of the world:

• Early History (pre–1624)
• Spread of the Patent System (1624–1850)
• Rise of the Anti-patent movement (1850–1873)
• Victory of the Patent Advocates (1873–1910)

Interestingly, many of the same argument, pro- and con, that were made then, have been made since. The most interesting of these four periods for our purposes is the third, 1850-1873. There is a huge amount of material from this period attacking IP—and from a free market perspective—that I have not been able to access or study in detail yet (but plan to). In this period, patents were attacked along with tariffs by free-traders, since both were seen to be obviously contrary to the free market. But with the depression following the Panic of 1873, there was a rise in nationalism and a reduced opposition to tariffs and protectionism. With the free trade cause on the ropes, its opposition to patents also became less relevant. The willingness to tolerate protectionism and other incursions into free markets and free trade opened the door to increased patent propaganda by special interest groups.

Thus, the anti-patent movement lost steam, and holdout nations such as Switzerland and the Netherlands finally gave in and reintroduced patent systems previously abolished (in the case of the Netherlands) or not yet adopted (Switzerland). Ever since, we have had a more or less universal, modern patent system in place in countries around the world.

2. The Debates among Individualist Anarchists the Late 1800s

As detailed by Wendy McElroy in works such as Copyright and Patent in Benjamin Tucker’s periodical Liberty and Contra Copyright, Again, early libertarian and proto-libertarians and anarchists in the late 1800s had vigorous debates on this topic. Lysander Spooner in The Law of Intellectual Property; Or an Essay on the Right of Authors and Inventors to a Perpetual Property in their Ideas (1855) had argued for IP but Benjamin Tucker deviated from Spooner, his mentor, and rejected IP. A vigorous debated ensued in the pages of Liberty, in the 1890s, with Tucker taking the most consistent anti-IP position, and others, such as Tak Kak (pen name for James L. Walker) and Victor Yarros, arguing for IP. Tucker’s arguments were powerful and influenced others later, such as McElroy.²

[continue reading…]

1. Fritz Machlup, U.S. Senate Subcommittee On Patents, Trademarks & Copyrights, An Economic Review of the Patent System, 85th Cong., 2nd Session, 1958, Study No. 15 [↩]
2.  Update: see Molinari on IP; Proudhon: For Intellectual Monopoly. [↩]

Okay, I’m being a bit sensationalist–but I’m referring to Obama-Backed Tesla Sues Its Critics, which notes:

Subsidized by taxpayers to the tune of a half-a-billion dollars (Obama “investing” your money), Tesla Corporation — and by extension, the feds — has been embarrassed by car journalist Jeremy Clarkson and the Top Gear TV show on BBC. It seems a Tesla Roadster when driven hard on the track (and owners who shell out six-figures for sports cars like to know these things) goes a mere 55 miles. Not the 200 that Tesla’s PR machine claims. What’s more, Top Gear — which does not yet suffer from green political correctness like car mags stateside — says the “car of the future” takes 16 hours to recharge, and recommends (tongue planted firmly in cheek) that buyers shell out another $100,000 for a second Tesla while the other one recharges.

Ouch. Welcome to the real world, electric cars.

Tesla’s response? Sue ’em!

Presumably for defamation (and yes, defamation rights should be regarded as a type of IP right).¹ Not sure what is more outrageous–the lawsuit, or this example of the poor being taxed to benefit the rich.

It reminds me of the time Oprah Winfrey was sued by Texas cattle farmers for “defaming” their beef on her show (luckily, she was successfully defended by Chip Babcock, a partner at my former Houston law firm–who apparently continues to defend her from defamation lawsuits).

1. See Kinsella, “Defamation Law and Reputation Rights as a Type of Intellectual Property,” in You Can’t Own Ideas. [↩]