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Source link: http://archive.mises.org/13931/trademark-and-goats-on-the-roof-bans/

Trademark and Goats-on-the-Roof Bans

September 17, 2010 by

Here’s a good case of the pernicious, insidious effects of IP on business. As noted in What’s Up On the Roof? Goats! (video below), Al Johnson back in 1973 added a Scandinavian-style sod roof and goats grazing on it, to Al Johnson’s Swedish Restaurant in Wisconsin. This was a brilliant entrepreneurial decision: the goats were very popular–the slogan became “Come for the goats–stay for the food.” So naturally, as success on the market leads to emulation (see Tucker & Kinsella, “Goods, Scarce and Nonscarce”), Tiger Mountain Markets, a restaurant in Georgia, decided to put goats on its roof too. Instead of this local Wisconsin restaurant being proud of its influence, or at least ignoring it and concentrating on providing a good service to its customers, its current owner Lars Johnson bought into the pernicious IP mentality and filed a lawsuit against the Georgia restaurant. They eventually settled, with Tiger Mountain Market paying an annual fee to Al Johnson’s for the right to have goats on their own roof. How magnanimous of Al Johnson’s, to let Tiger Mountain use their own property as they see fit!

The WSJ reporter totally misses the boat, referring to Tiger Mountain’s decision to use goats on its roof as trying to “horn in on the roof-goat angle”–such a negative, loaded way of describing peaceful, productive, natural emulation on the market. The reporter concludes that, once Al Johnson’s was able to settle with Tiger Mountain and extort money from them, “that means Lars Johnson can worry less about trademark infringement, and more about serious goat-related issues, like escape attempts.” Notice how this portrays poor Lars Johnson as a victim, sitting up “worrying about” trademark infringement. When instead, the victim here was innocent Tiger Mountain; Lars Johnson didn’t have to worry about what Tiger Mountain was doing in Georgia; he could have minded his own business and focused on his job: providing a good service to customers in search of profit.

This is yet another case of how IP law literally violates the bodily or property rights of others–I list other examples of how IP law leads to censorship, book banning, or actual limitations on bodily freedom (such as the right to sing a song or take a job) in The Patent, Copyright, Trademark, and Trade Secret Horror Files.

{ 115 comments }

Ken Zahringer September 17, 2010 at 10:18 am

Hmm… Maybe we should find some Scandinavian farmer whose family has had goats on the roof for generations, and get him to sue Al Johnson. That could be entertaining.

IP – fighting unemployment in the legal profession.

J Cortez September 17, 2010 at 12:55 pm

I was wondering if the Scandinavians would get in on this. :)

Also, I think a better slogan would be:IP – fighting unemployment in the legal profession, while creating it in all others.

Dave Narby September 17, 2010 at 10:22 pm

I’m still waiting for Mr. Kinsella to answer the following:

If intellectual property is abolished, thus denying innovators the fruits of their intellectual (and in the case of R&D, physical) labors, where will the incentive to innovate come from?

I assume you are going to release a paper on this soon.

Jay Lakner September 18, 2010 at 12:08 am

I’m still waiting for Dave Narby to answer my counter-question:

If bakery owners aren’t granted a monopoly, thus denying bakers the fruits of their labor, where will the incentive to construct bakeries come from?

I assume you are going to release a paper on this soon.

Kerem Tibuk September 18, 2010 at 5:18 am

Bakery owners already have a monopoly in a free society. Over “their” bakery.

Having property rights mean, having a monopoly over property.

IP socialist that cry “monopoly” when it comes to IP really amuse me. They don’t even know the meaning of property rights but they easily use scary words like “monopoly” without thinking what is what.

Jay Lakner September 18, 2010 at 9:40 pm

Kerem you don’t understand what “monopoly” means do you?

Monopoly means having control over the means of production of a class of good.

If you understood this, you would realise how utterly ridiculous your “rebuttal” to my response was.

Dave Narby September 19, 2010 at 6:04 pm

Apples to oranges, Mr. Lakner.

Nice try.Let’s keep this discussion on IP, shall we? Try this gedanken experiment:

If the baker had a yeast he developed, at considerable expense, which gave some benefit to his bread that made it superior, should he not be allowed to patent that yeast and be given exclusive use of it for a period of time, that he might profit by it?

I say yes, because that profit was the motive for his innovation.You say no, because..?

How about if the baker came up with a new, innovative means of bread production.

I say he should be allowed to patent his innovative oven design and exclusively profit by it for a period of time.

You say no, because..?

Jay Lakner September 20, 2010 at 1:13 am

If an individual sets up a skateboarding club in a town which previously had none, and this club proved popular, should he not be granted a monopoly that he might profit by it?

I say yes, because that profit was the motive for the hard work, effort and risk that went into producing this club.

Mr Narby, “Apples to oranges” is not an argument. You need to demonstrate exactly why these examples are not the same.

Furthermore, maybe you could clear something up for me…

You wrote:
“Let’s keep this discussion on IP, shall we?”

Define “IP”.
Furthermore, define “property” and show me why your definition of “IP” is a subset of “property”.

Andrew September 18, 2010 at 3:27 am

Should the Austrian school be concerned with engineering the society by means of “incentives”, the buzzword-of-the-day? The entire notion of “providing incentives” strikes me as being very neoliberal at best, and socialist at worst.

Les Smith September 18, 2010 at 8:37 pm

Hi Dave:

I doubt that innovation would cease if “intellectual property” was abolished… The incentive would be to take new inventions to market faster and to build an established customer base for the product before the competition can reverse engineer the respective technology. Of course, this would not require a producer to publish any details of a true innovation for the general public and should also permit the ability of research and development entrepreneurs the time to sell their ideas for a reasonable profit.

In my humble opinion, the vast majority of “intellectual property” is nothing more than cheap imitations of simple concepts already available with just a few adjustments and “protected” by layers of legal manipulations in the interest of making something old look new again… As a professional artist working in the business world, I am often amused at what is even considered as “intellectual property”.

For example, people buy my hand-thrown pottery because they like the finger lines on a particular bowl or the unique colors that happen to appear in a glaze finish that nature has embellished due to unpredictable circumstances as the result of whatever happened in the kiln (even though I have used the same mixture of chemicals and temperature in the firing per a previous run)… It would be silly for me to claim some sort of new process because these actual methods have been used for thousands of years!

I do enjoy the fact that customers choose to purchase my work over that of others even though these competitors have had the same chance as me to make the sale… This concept is what I consider as an underlying intent of like-minded libertarians of the Ludwig von Mises School of Economics…

Nothing “magic” here just like there is nothing “special” about what is heralded as “innovative” in the pharmaceutical and other industries… They seem to be overladen with staff attorneys retained for IP purposes and for the most part just block free market policies plus add unnecessary cost to the bottom line for business in general.

Best Regards,

Les Smith
Registered Investment Advisor

Stephen Adkins September 18, 2010 at 9:46 pm

Awesome points, Les. I especially liked this point:

“Of course, this would not require a producer to publish any details of a true innovation for the general public and should also permit the ability of research and development entrepreneurs the time to sell their ideas for a reasonable profit.”

One of the common examples IP apologists tend to use is the R&D process in pharmaceutical companies. It takes many millions of dollars and several years to develop a drug, but once developed, most drugs are quite cheap to produce, and any competitor can come in and undercut the original innovator. Without patents being granted to these innovators, no drugs would ever be produced. Thus, they say, we need intellectual property, even if only on utilitarian grounds.

What this misunderstands is just what you pointed out: Why should it be that a pharmaceutical company must release every tiny ingredient, in every tiny dose, and every single process to the public (and its competition) before a drug can be sold? The presence of the FDA necessitates a legal way (in this case, patents) for the now naked company to be able to recoup its R&D costs.

In the free market, on the other hand, a company could pay to innovate and develop an awesome new drug, and pay further to ensure that these new processes would remain a secret. Competitors would be free to attempt to develop a similar drug, but without the published FDA reports it would often be a shot in the dark. The innovator could make wonderful profits and create incentives for other drug companies to innovate other drugs.

In the above case, I’m sure, we would hear nothing about how the innovator must be protected, but instead how the monopolistic firm who cares only for profit must be sued on the behalf of the public, because it’s the only firm producing drug X and it’s charging monopoly prices.

Dave Narby September 19, 2010 at 6:08 pm

“Of course, this would not require a producer to publish any details of a true innovation for the general public and should also permit the ability of research and development entrepreneurs the time to sell their ideas for a reasonable profit.”

This argument ASSUMES THE EXISTENCE OF IP!

Without IP, the producer has NOTHING TO SELL.

Thanks for making my argument for me!

Peter Surda September 19, 2010 at 6:14 pm

Without IP, the producer has NOTHING TO SELL.

That’s just ridiculous.

Jay Lakner September 20, 2010 at 1:16 am

Dave Narby wrote:
“This argument ASSUMES THE EXISTENCE OF IP!”

In what way?

Dave Narby September 21, 2010 at 5:10 pm

Hi Les,

What you describe is the abuse of IP laws, which any thinking person clearly opposes.

However, the fact that there has been ‘regulatory capture’ concerning on the part of multinational corporations is no reason to abandon IP, but rather to reform IP laws and agencies.

In fact, I would support weighting the laws to defer to individuals and small/medium sized companies, since that’s where the majority of job growth takes place.

Anthony September 18, 2010 at 11:30 pm

Hey Dave,

Perhaps you have heard the music of Mozart? Beethoven? Hayden? Were you aware that they has NO form of protection on their works (other than the physical scores they produced)?

Perhaps before you demand that Kinsella explain where innovation will come from if IP is abolished (or regulated in a non-aggressive manner by a free market) you should explain every instance of innovation before the 1700′s. Be sure you don’t miss any, because if there was any innovation at all before IP laws then you should withdraw your question.

Dave Narby September 19, 2010 at 6:11 pm

Thank you for making another point of mine.

Mozart, et. al. were paid by POWERFUL PATRONS.

In a world without IP, those patrons will be called MULTINATIONAL CORPORATIONS. Because they will be the only entities which can:

1.) Develop a new product in secret
2.) Bring it to market fast enough so that counterfeiting isn’t an issue

With no IP, you can kiss the individual inventor good bye (unless he works for Conglom Inc.)

Statureman September 17, 2010 at 10:39 am

oh my word… maybe restaurants should start suing each other over IP rights to serve food on square plates… or having roof patios, or serving tacos, or making just the act of making food and charging for it…

Dave Narby September 19, 2010 at 6:12 pm

Square plates, etc. are public domain, you dolt.

Stephen Adkins September 20, 2010 at 1:47 am

Keep it civil.

Why should it be obvious that square plates are public domain? Restaurants choose this style of plate bc they believe it will be an enhancement to their business (aesthetics, maybe). Thus there is a profit motive for them to do so. They feel that their bottom line will increase by the use of this plate. But maybe it won’t if copycats come in and steal that idea.

There had to have been a “first mover” at some point in history, who either first thought up making plates into a different shape, or perhaps introduced the concept from from a different culture. Both of these represent some amount of work or risk. At what point do you objectively delineate between rightful exercise of a patent, and a case in which only a dolt would miss that “it’s part of the public domain?”

In fact, while you’re at it, explain what the public domain even is. Or why there should be one. You seem to think it’s quite obvious that there is a point in time in which protected processes and ideas must pass into it, but what is “it”?

Dave Narby September 21, 2010 at 5:19 pm

Square plates are public domain because square plates have been around for centuries.

From Wikipedia:

“In a general context public domain may refer to ideas, information and works that are “publicly available”, but in the context of intellectual property law, which includes copyright, patents and trademarks, public domain refers to works, ideas, and information which are intangible to private ownership and/or which are available for use by members of the public.” and “In most countries the term for patents is 20 years, after which the invention becomes part of the public domain.”

And I’m sorry, but if someone gives a stupid, sarcastic non-reply that isn’t meant to advance the argument, but instead as an ad-hominem attack; I’m pretty sure that merits calling them a dolt, as they clearly qualify. If you want civil discourse, then I humbly suggest you tell the anti-IP crowd here to put a sock in it, as they are the ones who are prone to engage in such tactics, typically when they have no arguments left.

JFF September 17, 2010 at 10:46 am

But as I pointed out in another post, Lars Johnson is seeking profit, profit by not doing anything and having it given to him via the annual fee Tiger Mountain has got to pay him. That is the real purpose of this nonsense; a free lunch for the poor, beleaguered I.P. infringement victim.

My recommendation, Tiger Mountain should get rid of the goats and not pay one cent more.

Shay September 17, 2010 at 12:59 pm

But as I pointed out in another post, Lars Johnson is seeking profit, profit by not doing anything and having it given to him via the annual fee Tiger Mountain has got to pay him. That is the real purpose of this nonsense; a free lunch for the poor, beleaguered I.P. infringement victim.

Nonsense. Mr. Johnson invested a significant amount of resources into developing the idea of a goat on the roof. He probably tried hundreds of other animals before he found this ideal combination. Now Tiger Mountain comes along and steals this idea from him, along with his potential profits, and now you’re defending him?!? Next you’ll be defending people who try to get away with allowing squirrels and birds to sit on their roof, without paying the person who came up with this unique idea.

Daniel September 17, 2010 at 2:07 pm

Tiger Mountain should have actual TIGERS on the roof

Idiot September 17, 2010 at 2:09 pm

and a mountain

J. Murray September 17, 2010 at 10:59 am

So, in all the history of sod roofing, goats, and people, a goat NEVER went up on a roof until 1973? Hard to believe.

Idiot September 17, 2010 at 11:00 am

I tried to get around the IP by introducing goats inside my restaurant. What was I thinking? No, it wasn’t the smell or the uninitiated sharing of salads with the livestock that did me in.
I got sued by some rural restaurant interest in China…

Abhilash Nambiar September 17, 2010 at 11:11 am

Hi Stephan,

Calling Tiger Mountain a victim seems to be a bit of a stretch. It is true that they did not steal anything. However they did benefit from a concept that Al Johnson thought out first. And Al Johnson took more market risk. He may have gotten the idea from some Scandinavian farmer but no one had tried it on a restaurant before and no one knew whether it would work. It worked out and now a copy-cat comes along and benefits without having taken the same risk. Not only does the copy-cat benefit, but benefits in a manner that negatively impacts Al Johnson’s business. Al Johnson can also play the victim card here.

Perhaps an Al Johnson endorsed logo would help. People who loved Al Johnson but find Tiger Mountain to be more convenient may like it. Tiger Mountain gets paid, Al Johnson gets a cut, the customers are happy, Al Johnson is happy, Tiger mountain is happy. In fact if Al Johnson becomes a legend for this idea more restaurants may want to try it out and may in fact seek his endorsement because it helps their business. He may even be able to shut down his restaurant and live on endorsement money.

J. Murray September 17, 2010 at 11:14 am

How did Mr. Johnson get victimized? Who in Wisconson decided to drive to Georgia to patron Tiger Mountain? Who in Georgia stopped going to Wisconson because Tiger Mountain opened?

Juraj September 17, 2010 at 11:25 am

Even if they were next to each other, it would not make any difference in the fact that Tiger Mountain is being coerced. By the same logic, any restaurant could sue neighbour restaurant for competing with them. The fact about who has goats on the roof or not is completely irrelevant.

Mind blowing how can anyone support this nonsense.

Abhilash Nambiar September 17, 2010 at 12:03 pm

I never made any case for suing anyone.

Abhilash Nambiar September 17, 2010 at 11:47 am

There is nothing objective about victimization. It is a state of mind. Take this example If my credit card gets stolen, I was robbed (that is objective). But I may not feel like a victim because the thief is spending far less than my wife would. 

Now previously someone in Georgia would have to go all the way to Wisconson to see goats on a restaurant roof. And if Johnson claims intellectual property on his idea (a non scarce good) they may still have to do that depending on what decision Johnson makes. Johnson maybe ok with that as he benefits from the monopoly. Johnson did not do that, but others have done similar things.

So I get Stephan’s argument that making property of a non-scarce goods create artificial scarcity in the real world. Nevertheless it is important to note that first movers in innovation take disproportionate market risk and absent intellectual property, there must be mechanisms in place to adequately compensate them. If not they will cling on to the ‘intellectual property’. That was the point I was trying to make. This is why intellectual property still has such a strong grasp even in libertarian circles.

Seattle September 17, 2010 at 12:38 pm

Nevertheless it is important to note that first movers in innovation take disproportionate market risk and absent intellectual property, there must be mechanisms in place to adequately compensate them. If not they will cling on to the ‘intellectual property’. That was the point I was trying to make. This is why intellectual property still has such a strong grasp even in libertarian circles.

You an apply this argument to anything. You can promote production by cartelizing an industry to guarantee them profits!

If it doesn’t work for physical goods why does it work for IP?

Abhilash Nambiar September 17, 2010 at 3:12 pm

I am not arguing for cartelization. I do not think cartelization is the proper manner in which to reward first movers. Nevertheless the market process should develop mechanisms by which first movers are adequately compensated for the risks undertaken. Only then will copy rights (or any other form of cartelization) can be rendered obsolete.

Tyrone Dell September 17, 2010 at 4:43 pm

“Nevertheless it is important to note that first movers in innovation take disproportionate market risk and absent intellectual property, there must be mechanisms in place to adequately compensate them.

Why? And by whom? And by what authority?

Abhilash Nambiar September 17, 2010 at 5:17 pm

Compensated by whom?
Compensated by whoever that benefits.

Who compensates the grocer for selling grocery? Who compensates the entrepreneur for taking risk and delivering what their others value? Who refuses to compensate them if they try pushing on to others what they do not value?

And by what authority?
Market is not a product of authority.

When I say there must be a mechanism what I mean is not that some authority should dictate one. What I am saying is that the market displays the need for it. There are solutions too depending on the compensation demanded by innovators; like creative commons licenses, copy left, open-source, creator endorsed mark and so on. They have made a dent in the concept of intellectual property, but they have not rendered them obsolete. Not yet anyway. Copyrights and patents still have a bigger share of the mind of the intellect. Maybe something better will come up. Maybe it needs time.

Tyrone Dell September 17, 2010 at 9:13 pm

“When I say there must be a mechanism what I mean is not that some authority should dictate one. What I am saying is that the market displays the need for it. There are solutions too depending on the compensation demanded by innovators; like creative commons licenses, copy left, open-source, creator endorsed mark and so on. They have made a dent in the concept of intellectual property, but they have not rendered them obsolete. Not yet anyway. Copyrights and patents still have a bigger share of the mind of the intellect. Maybe something better will come up. Maybe it needs time.”

What makes you believe that markets need intellectual property rights?

Of all those examples, only one is actually a free-market innovation not backed up by legislation (the one in bold). Coincidentally, it happens to be the best case of an anti-IP philosophy that most internet users are familiar with today.

Creative commons licenses, copy-left, and creator’s endorsements is to assume intellectual property is necessary in the first place, which is essentially assuming what you are trying to prove. Those phenomena are actually retaliations to our current intellectual-property legislation.

Markets don’t need to defend intellectual property because ideas are not scarce; no matter what your definitions and views of “fairness” are, defending “intellectual property” (sidestepping the entire issue of trying to simply define the boundaries of this property in the first place!) can only be accomplished with the aide of a de facto government. This by its very nature means it is not a solution that springs out from the market itself.

Idiot September 17, 2010 at 11:16 am

I do not understand how risk may be contrasted here. Even if Wisconsin was successful does not mean it will be anywhere else. Or that Wisconsin will remain successful, etc. Each day the market must be won anew and nobody knows the future.

Abhilash Nambiar September 17, 2010 at 11:54 am

It is true that if Johnson was successful does not automatically mean anyone else would be. But it is also true that if Johnson is successful it indicates that he is providing lot of people what they value. Emulating his business model thus becomes a good rule of thumb for success. Think of the ipod knock offs that came to market after Apple’s success. Think of the smart phone market that exploded after the iPhone launch. There where smart phones before iPhone but you had to be a geek to know how to use them. I think this emulation is a good thing, but the first mover assumed the most risk here. Apple itself had no successful smart phone to model itself after. So there must be a market mechanism to adequately compensate them for that risk.

Idiot September 17, 2010 at 1:13 pm

But isn’t part of the risk guaging how quick the copycat can get in the game? You know, estimating how long the window of opportunity for unique profit is going to be.

Abhilash Nambiar September 17, 2010 at 3:13 pm

Being a copy cat is not risk free, but being original is certainly much more risky. The rewards are great for those that succeed but the losses are huge for those that fail and many do fail. Ask a venture capitalist. You will know.

Steve September 19, 2010 at 4:00 pm

Being somewhat new to Austrian economics, I’m still trying to figure things out. Are you saying that because being a pioneer in something is riskier that the pioneer is entitled to more monetary remuneration? Isn’t part of the risk of being the first to have the idea well…part of the risk? Without IP law or other forced market controls will the pioneer not calculate the risk of being first? If he doesn’t whose to blame?

As to your statement about huge losses and failures in the market, I agree. Satisfying the consumer is the number one goal, and it’s extremely hard to do. A question I’ve had is what causes more failure, infringement on “IP” or IP law itself? Many failures are because the ideas, services, promotion, or products aren’t good enough, but in my experience it is IP law that snuffs out the ability for someone else to tweak an idea or product and make it work.

J. Murray September 17, 2010 at 1:17 pm

The market mechanism for adequate compensation is to make a product that people want at a price they will pay.

And Apple is a terrible example of innovation. Portable digital players and smart phones existed long before Apple “innovated” them. The iPhone is NOT a wildly successful phone compared to two competitors (Blackberry and Android). Blackberry-based phones existed long before them and, to this day, still enjoy a market and month-to-month sales lead over the iPhone. iPhone is third place and falling at at no point ever “owned” the market or even popularized it.

Apple’s strength is in the marketing. They took no risk beyond entering an established market. If that’s what you claim should be protected, then Al Johnson had more cause to sue over the fact that someone else had the gaul to enter the restaurant market. Opening a restaurant is infinitely more risky than putting grass and goats on your roof.

Abhilash Nambiar September 17, 2010 at 3:22 pm

Blackberry phones are the early innovators in smart phones. Their clients are mostly corporations. Both Apple and Android directly targets consumers.

Innovation not just involves developing new product technology, it can also be finding new uses for an old technology (like sony did with the walkman) or find effective uses for an existing technology and ofcourse there is innovation in marketing too. Luck also have a significant role to play in the success of any product. Before apple entered the music business electronic music delivery was underground. They made it mainstream. They also mated this distribution platform with a superb product through which people could better manage their music. Then there was marketing too.

I am not telling that apple should be protected or that Al Johnson should be protected. Only that it would be better for future entrants into their market to recognize the first mover’s contribution towards developing these markets.

Shay September 17, 2010 at 2:42 pm

I think this emulation is a good thing, but the first mover assumed the most risk here. Apple itself had no successful smart phone to model itself after. So there must be a market mechanism to adequately compensate them for that risk.

There is: first-mover advantage. But even if there weren’t, why must there be? Should there be adequate compensation for businesses who show that some practice is harmful and takes the business down with it? After all, they took the risk and allowed others to profit from avoiding it.

Your reasoning for requiring adequate compensation seems to simply be that it wouldn’t happen without this compensation, or that without, those uncompensated have been robbed by others. Most things in the market have positive externalities, and requiring that they all be paid for would greatly hamper the market. The activities would still occcur (do still occur) without compensation. They very term implies that something has been taken, but it hasn’t!

Abhilash Nambiar September 17, 2010 at 3:40 pm

I do not think you understood what I am saying. First movers take higher share of risk than others. Most innovations never see the light of day and of those that do many fail. Think Iridium phones. Most first movers are failures. The only compensation for first movers is that they will have a large hitherto untapped market for their product if they succeed. To keep them innovative means to compensate them adequately for innovating. That has to happen whether or not there is ‘intellectual property’. I do not see how else ‘intellectual property’ except if the market develops other more effective mechanisms to compensate innovators. Maybe positive externalities and profits are adequate for some. But if the real world is something to go by, innovators are looking for something more concrete and more certain in the form of compensation. I have no doubt that the market can address this.

andy September 18, 2010 at 1:50 am

Just looking at the free software industry…there is certainly a lot of inovation where nobody is being paid for it. It is huge. Yet…you claim it wouldn’t exist? The objection that GPL can exist only because of IP doesn’t apply, as your claim is that nobody would do it if he wasn’t paid (and he isn’t paid even if it is GPL), and there is plenty of software with BSD license and LGPL licenses.
The world would look different, but I doubt there would be less innovation. The companies would innovate in areas where they could better capture the profit; would that be less rewarding for the society? I have no idea.

Juraj September 17, 2010 at 11:20 am

However they did benefit from a concept that Al Johnson thought out first

Thought of first? Assertion. There is no way to prove this.

Al Johnson can also play the victim card here

No he can’t. Nothing has been taken from him nor was he assaulted. As opposed to Tiger Mountain.

Tiger Mountain gets paid, Al Johnson gets a cut, the customers are happy, Al Johnson is happy, Tiger mountain is happy

Sounds like a Mafia practice to me.

Abhilash Nambiar September 17, 2010 at 12:02 pm

Thought of first? Assertion. There is no way to prove this.

That depends on what you are referring to. If you mean the idea of having goats on a sod roof, maybe no. If you mean using that as the basis for a successful restaurant then yes. If there was already a successful restaurant based on that concept, they would be suing Johnson. And if they chose not to, there is no problem to speak about.

Like I already said there is nothing objective about the feeling of victimization.

Sounds like a Mafia practice to me.

If Al-Johnson gets a cut for ‘intellectual property’ then it is mafia. But if he gets it for endorsement then it is not.

Juraj September 17, 2010 at 12:36 pm

If you mean using that as the basis for a successful restaurant then yes

How can you be so certain? Have you all the knowledge about every single restaurant in human history? Surely if intellectual property theory is valid then it is valid for the entire history of human race. Anything that one allegedly thought of first can be claimed as “property”. That’s absurd. All this nonsense is arbitrary – meal recipe isn’t IP, goats on roofs is IP etc. and therefore cannot be a “natural” law.

And define successful restaurant.

If there was already a successful restaurant based on that concept, they would be suing Johnson.

Assuming that everyone is into coercing others for alleged “intellectual” property violation. My post proves otherwise.

But if he gets it for endorsement then it is not.

I’m fine with voluntary endorsement but not as a result of threat of being sued, i.e. pay me and put my logo up or I will sue you.

Abhilash Nambiar September 17, 2010 at 4:02 pm

How can you be so certain? Have you all the knowledge about every single restaurant in human history?

Well there is one successful restaurant. A good copy-cat will see that others based on the same concept are likely to succeed. So it is worth giving it a go. It is not something that one can be absolutely certain about, but reasonably certain about. Just note real market trends. Copy-cats that follow successful real time innovators tend to be successful.

Assuming that everyone is into coercing others for alleged “intellectual” property violation. My post proves otherwise.

Those that do not usually get a creative commons lisence.

I’m fine with voluntary endorsement but not as a result of threat of being sued, i.e. pay me and put my logo up or I will sue you.

What is your opinion on this one? If you put my logo without paying me, then I will sue you.

Juraj September 18, 2010 at 3:41 am

Voluntary as in you put the goats on the roof first and I acknowledge it and ask for your permission to put your logo up.

Bill in StL September 17, 2010 at 1:08 pm

Sure, Al Johnson took the bigger risk for opening his restaurant first. But he also reaped the larger reward of being first to market with a goat-roof. His copycats are publicly known as followers, and Al is still the innovater. Perhaps Al would have a fraud case if the Georgia restaurant started claiming to be “the Original” goat roof restaurant.

J. Murray September 17, 2010 at 1:16 pm

“Perhaps Al would have a fraud case if the Georgia restaurant started claiming to be “the Original” goat roof restaurant.”

Actually, no. Being the “original” doesn’t in any way impact the quality of the product being saught. Fraud would be taking payment and delivering (or non-delivery) of a product that is intentionally not set to the agreed standards.

By calling itself original it would not in any way impact the customer-business relationship. Ordering a burger and fries is the same whether it was “original” or not. Calling yourself “The Original” adds zero value to the product being purchased.

Bill in StL September 17, 2010 at 4:21 pm

Perhaps the claim of “Original” is irrelevant to you, but of course value is subjective. It is reasonable to suspect the customer may consider the product to be “Hamburger at the Original Goat-Roof Restaurant.” Perhaps she plans to brag about this later to her friends, who she heard went to those poseurs up in Wisconsin. She could then very reasonably be disappointed to hear that she didn’t get the meal planned, but instead “Hamburger from those Liars in Georgia.”

Wait, you claim, a hamburger is a hamburger. What you’re doing is taking it upon yourself to decide what is and isn’t essential to the product. This will be an arbitrary decision. The only clear way to determine fraud is to evaluate if the product offered matches the product delivered. And, if the restauranteur is advertising himself as “the Original,” one can reasonbly conclude it is part of the offer. Logically, if he didn’t think it might sway consumers at the margin to chose him, he wouldn’t have made the effort of advertising it.

Granted, I can’t see a lot in the way of damages, but I still would consider it a fraud. Which preserves claims such as “Original” as a method for the originator of an idea to protect himself without resorting to IP.

Abhilash Nambiar September 17, 2010 at 4:22 pm

Actually, no. Being the “original” doesn’t in any way impact the quality of the product being saught.

What makes calling yourself “original” when you are not a fraud is not the quality of the product. It is the fact that you are selling your product under false pretenses. If you sell silver plated gold by claiming it is silver, technically speaking it is a fraud.

Eric September 17, 2010 at 4:54 pm

They are the original restaurant in Georgia with goats on a roof. By your justification every church with “First”, “Second”, etc. in their name is a fraud.

Abhilash Nambiar September 17, 2010 at 7:42 pm

You still did not understand what I said. I never said what is not original is a fraud. I fraud is passing off what is not original as original.

J. Murray September 17, 2010 at 6:22 pm

Selling gold as silver is fraud because you’ve provided payment for silver, not gold. No one goes into a restaurant and orders original. What is original? What does it look like? Can you touch it? Eat it? What does original taste like? The term original in no way describes the form or function of the product ordered. Nor do subjective terms like “Super” or “Best”.

Calling the restaurant or product original has no bearing on what I ordered. I ordered a burger and fries. The nomenclature is meaningless. If the restaurant delivered chicken fingers and a salad and refused to provide the correct order, then it would be fraud. Whether it was the “original” burger or not doesn’t make one bit of difference to anyone. Well, maybe people looking to sue someone for no other reason than to get money out of the deal (see Mr. Johnson for reference).

Abhilash Nambiar September 17, 2010 at 7:49 pm

Nonsense. Original has a proper meaning that can be understood best within context. It is not meaningless. Granted its meaning is not as precise as some other words. But it is not meaningless. An idea is called original if it departs from previous practice, even if it is a derivative of previous work. Don’t abandon common sense.

J. Murray September 20, 2010 at 7:12 am

Common sense is an insult to the intelligence of an individual. He only believes as the commoners do. I’m happy to say I don’t have common sense.

Let’s do a blind taste test. I’ll make a burger my “original” way and 10 others will copy it 100% identically. We’ll put them out at random and you tell me which one is the original. If you can pull that stunt off 10 times in a row, I’ll concede that calling something original has merit. I suggest you leave the site, never to return until you accomplish this task.

Abhilash Nambiar September 17, 2010 at 4:13 pm

True. My point was that since markets are present to manage people’s uneasiness, it should develop mechanisms so that the Al Johnsons are less likely to feel that their followers have succeeded at their expense. Otherwise they will cling on to copyrights. Now a scholar might know that it is counter-productive, but not all innovators are scholars.

Beefcake the Mighty September 17, 2010 at 1:27 pm

Is it possible we’ve found someone even more loathsome on the issue of IP than Silas?

Abhilash Nambiar September 17, 2010 at 4:17 pm

What is so loathsome about my position? I am not trying to be pro-intellectual property, just pro-intellectual. Even without patents and copy rights there must be ways for intellectuals to become rich of their discoveries otherwise they will end up as instruments for the state.

Joshua September 17, 2010 at 3:03 pm

Abhilash, I invented the concept of taking the opposite view of a blog post. You will be hearing from my team of hungry lawyers.

Abhilash Nambiar September 17, 2010 at 4:16 pm

Well unfortunately for you, I am not arguing for intellectual property. Even if intellectual property is bogus, intellects are real. If the market does not develop mechanisms to address their interests then innovations will suffer.

Anthony September 18, 2010 at 11:43 pm

Abhilash,

“If the market does not develop mechanisms to address their interests then innovations will suffer.”

Fine. Then let there be less innovation if that is what the market would actually produce.

What is loathsome is your assertion that people should continue to have their real rights violated by IP laws until such a time as “the market process” develops adequate protections (adequate according to whom, I might ask).

Sarah September 17, 2010 at 11:53 am

@ Idiot: Forget the salad. Goats are sneaky. Watch your beer.

If good ideas are property, and property has value, and FR notes can be used as a medium of exchange for value, can good ideas be used to pay lawyers?

What kind of an outcry should we expect when one of these businesses gets its building LEED certified for having a low-maintenance insulating green roof?

Idiot September 17, 2010 at 1:16 pm

Ha ha ha! Are you right or what. I was going to link a youtube vid of a goat drinking beer but there are so many of them I couldn’t settle on one! made me thirsty too.

Idiot September 17, 2010 at 1:19 pm

http://www.youtube.com/watch?v=jGZQHVOww2A&feature=related

its only 25 secs and i almost died laughing

Silas Barta September 17, 2010 at 12:26 pm

see Tucker & Kinsella, “Goods, Scarce and Nonscarce”

The purpose of citations is to support your argument by showing that it bases itself on other strong arguments.

Citing a questionable article by yourself doesn’t do that.

Stephan Kinsella September 17, 2010 at 2:05 pm

Silas, you are like the wax-museum version of Lenin that people in a free society keep around to remind them of horrors of the past. Congrats.

Juraj September 17, 2010 at 2:25 pm

LOL

Kerem Tibuk September 18, 2010 at 5:20 am

Hahahahaha.

Jeffrey Tucker September 17, 2010 at 1:43 pm

This case demonstrates a point that is very clear once you start looking at IP logic: its consistent application would eliminate all competition, freeze the economy in place forever, and bring all entrepreneurship to an end, thus destroying civilization itself.

Stephan Kinsella September 17, 2010 at 1:52 pm

Right. No offense, Silas.

Silas Barta September 17, 2010 at 2:29 pm

Same thing for property if you took it too seriously: “Hey, you’re reflecting EM waves from the sun onto my property! Stop that, terrorist!”

jspradley September 17, 2010 at 1:46 pm

Why can’t a restaurant sue another for making and selling food then? What’s the objective difference between a gimmick such as goats on the roof and a basis premise of making food for sale?

Stephan Kinsella September 17, 2010 at 1:52 pm

There is none; no offense, IP fascists.

Abhilash Nambiar September 17, 2010 at 4:54 pm

The business model of a restaurant is tried and tested (excepting minor variations) while an innovation (like goats on the roof) by definition is new and untested. Is that not a difference? Mind you I am not trying to make a pro-IP argument. Just noting that there are differences.

DD5 September 18, 2010 at 12:00 am

“There is none; no offense, IP fascists.”

Keep flinging poo from your monkey cage, Kinsella. It’s quite amusing to us observers.

Kerem Tibuk September 18, 2010 at 5:25 am

:-)

He has been called an IP socialist, and rightfully so because he wants to socialize privately produced property. But since “socialist” is a bad word he needs a come back with another bad word like “fascist” even though fascism has nothing to do with the issue

This is what you get when you argue with an intellectual lightweight.

Jay Lakner September 18, 2010 at 5:50 am

Kerem Tibuk wrote:
“…because he wants to socialize privately produced property…”

You are so intellectually dishonest Kerem. You know very well that the issue in question is whether or not patterns and ideas should be considered a form of property.
Rather than actually producing an intelligent argument, you throw around the term “IP Socialist” to hide your intellectual ineptitude.

Kerem Tibuk September 18, 2010 at 10:45 am

“Rather than actually producing an intelligent argument, you throw around the term “IP Socialist” to hide your intellectual ineptitude.”

Look Jay these concepts are pretty simple.

If you want to socialize privately produced “factors of production” you are called a Marxist Socialist.

If you want to socialize privately produced novels, poems, etc you are called an IP socialist.

If you claim no single individual can own IP but only society as a whole can own it despite the fact that it was produced by some specific individual you will be called a socialist.

Jay Lakner September 18, 2010 at 9:37 pm

Look Kerem these concept are pretty simple.

You are using two completely different definitions of property which contradict one another.

A. The right to alter the integrity or momentum of that which is owned.
B. The right to arrange materials into the configuration of that which is owned.

Can you please tell me whether it’s A or B that defines property?

Stephen Adkins September 18, 2010 at 7:37 pm

“He has been called an IP socialist, and rightfully so because he wants to socialize privately produced property.”

That claim depends on your definition of property, Kerem. I probably don’t have to tell you that one of the primary illuminations that economics gives us is that we live in a world of scarcity, and that the struggle of mankind (individually as well as socially) over the years has been to reduce this scarcity.

One can only have meaningful property rights over that which is scarce. If a thing is not scarce (ie it can be used by practically infinite parties simultaneously without its usefulness and availability being depleted), it falls under what Rothbard and others called the “general conditions of welfare” (sunlight and air, under present circumstances, come to mind).

Thus, the foundation of Kinsella’s argument is not that there is one special class of property that should be free to use by all (an essentially socialist position). It’s that “intellectual property” is an artificial term applied to non-scarce entities (ideas).

To contrast, when he uses the term “fascist,” it is not a tit-for-tat namecalling exercise. He’s not finding a clever way to call IP supporters nazis. He is using a term to describe the politico-economic arrangement in which entities within the market are free in name only. If a nominally-free firm’s decisions are made by someone outside the firm, such as a government or by a party who has the sanction of the government, then the freedom of that firm is just that – nominal. This is the essential quality of fascism. Kinsella was using the word in this sense. Our freedom of speech, expression, and the use of our property that we so cherish is, in certain cases, merely nominal. If we try to use our property in a manner that has been declared “owned by the holder of copyright,” we will be forcibly redirected, proving that we do not in actually fully own our property. We, and our property, are partially owned by the state.

Stephen Adkins September 18, 2010 at 8:55 pm

“Look Jay these concepts are pretty simple.If you want to socialize privately produced “factors of production” you are called a Marxist Socialist.If you want to socialize privately produced novels, poems, etc you are called an IP socialist.”Again, if you want to make a real argument against Kinsella, or any anti-IPer for that matter, you have to make arguments on the correct grounds. You seem to be lumping intellectual property in with real world property, without establishing the grounds for doing so. The position stated clearly on this board time and again is that “IP” has a fundamental difference from physical property: that of it’s non-scarcity. In all the substantial arguments against IP which I have read, the starting point is to sever this conceptual link, to show that IP is not property at all, because it’s non-scarce (infinitely reproducible) nature makes ownership a moot point.

Thus, to refute the anti-IP position, it does no good to use the universally accepted understanding of property (i.e., physical, scarce) as an analogy for IP, because IP does not have those same qualities. To say that we must protect the owner of an idea just as we protect the owner of a factor of production is circular, because you have not proven that an idea is the sort of thing that can be owned in the first place.

Kerem Tibuk September 19, 2010 at 2:06 am

Stephen,

Who says property rights have anthing with economics and concepts of ceonomics like scarcity?

One was Marx. Marx viewed property as a necessary evil and a consequence of scarcity. He thought once capitalism, with its huge productivity, produces goods and services so abundantly the scarcity would be over, communism would follow captalism and private proeprty would be abolished. Then the “communist man” would stop worrying about producing but enjoy his life playing piano in the morning and attending to his rose garden at the evining.

This might be a nice dream but there is a problem shared with the IP socialists here. The focus here is on the product, hence the view is materialistic. You can not find the individual anywhere. The individual that is responsible for the production. So this nice dream becomes a reason for enslavement. By Enslavement I mean claiming a right on the products of another individual.

Also I am not lumping up anything. It is the IP socialists that are arbitrarly separating property and declaring one is ok but the other is not.

Yes we all now their nature is different. But that is also true for movable property and unmovable property, like land. Are we suppose to treat them different just because they have different natures.

There is one and only one distinct characteristic of PROPERTY that defines what is property and what is not and that,

IT IS CREATED, PRODUCED BY SOME SPECIFIC INDIVIDUAL.

That is what makes something a property, the human touch. Not some arbitrary concepts someone cooked up like scarcity, or rivalry or movability or its color, etc.

Jay Lakner September 19, 2010 at 3:58 am

Kerem you nincompoop.

You have not even defined what “property” is.

Your big song and dance is meaningless absent a specific definition of property.

Jay Lakner September 19, 2010 at 4:10 am

Maybe I should elaborate.
Kerem’s posts irritate me no end. If I was given a penny for the number of times he has tried to pass this crap off as a definition of “property”, I would be retired by now.

Kerem Tibuk wrote:
“IT IS CREATED, PRODUCED BY SOME SPECIFIC INDIVIDUAL.”

You try to pass this off as a definition? This is a (very poor) attempt to describe how “property” comes into existence. But it does not define what it is.

Please Kerem. Give us a proper definition of “property” and then we might be able to have a discussion as to what does and does not qualify as property.

J. Murray September 20, 2010 at 7:18 am

The moment IP is created it is immediately without scarcity. Therefore, IP isn’t property as it is not tangible. No one can pick up the idea called “goats on roof” and show it to me in their hands. If I use this idea of “goats on roof”, I have at no point taken anything from the other individual. The only scarce items – goats and roofing – aren’t being demanded to be communally owned. There is no socialism going on here.

IP IS socialism as it is a central power dictating to me what I can and cannot do with my own property. Rejecting IP is rejecting socialism, not embracing it.

Mr Whipple September 17, 2010 at 2:09 pm

Does the Department of Health know that there are goats on the roof?

Idiot September 17, 2010 at 3:02 pm

Maybe that is how the idea really came to the owner. ‘Now, where to hide the goats during inspection?’

Statureman September 17, 2010 at 4:00 pm

wow. no mention of the real victims here at all… (in fact the IP fascists live in such a world were the victim likes the abuse…) namely the customers of the sued restaurant. They have to pay higher prices for the joy of eating under a roof with goats on it because someone over 800 miles away (per google maps)decided he “owned” the idea of putting goats on the freaking roof… think about this for a second… ridiculous.

John Spiers September 17, 2010 at 4:57 pm

Contra Abilhash, there has always been a mechanism for rewarding innovators and first movers. It is called the market, and marketing. In history by far the majority of innovation has used this and uses this now. And what is best, it is customers who reward either the first mover of the copycat, depending which pleases the customer most, usually through continuous improvement and redesign. At the heart of IP support is the dream/fantasy of never having to work again. At the heart of innovators is the dream of a lifetime of ever-improving customer satisfaction. The money will follow.

Abhilash Nambiar September 17, 2010 at 5:46 pm

How does the innovator get rewarded if the copy-cat profits on the innovation? While recognizing copyrights and patents as a wrong way of protecting innovators, I still say that the market does not in have enough safeguards to ensure that innovators are properly recognized and compensated for the innovations. If someone else can profit from your innovation, it has to be that way. That is what gives copyrights and patents their power.

I agree with you the customer should be able to have the final say in this issue. But for that the customer needs to have an easy way to know which product or service if purchased will compensate the innovator and which won’t. Maybe if the original innovators have made enough of an impression on the mind of the consumer, those that develop derivatives too may choose to give them a cut to further their business.

Not having to work is not an issue if you are not stealing or extorting and contribute productively to the economy. On the other hand there is a lot of busy work that you can do which is totally useless. Don’t confuse productivity with work.

Stephen Adkins September 18, 2010 at 9:24 pm

The innovator is rewarded inasmuch as his innovation helps him to meet consumer demand better than his competitors can. This separation may indeed be short-lived because his competitors will soon emulate what he has done, but this is also the case in the real world, only ~20 years removed (expiration of the patent). If what you’re saying is correct, the innovator should forever be entitled to the fruits of his intellect. The fact that the gravy train ends abruptly and arbitrarily after some legal time limit because “that’s enough” betrays it’s shaky position.

“Not having to work is not an issue if you are not stealing or extorting and contribute productively to the economy. On the other hand there is a lot of busy work that you can do which is totally useless. Don’t confuse productivity with work.”

As far as that goes, that’s the whole issue. Whoever made that point was saying that the mercantilist ideal of giving a firm the sole use of a particular market allows, at least to some extent, complacency on the part of that firm, because its managers know that no matter how much or how little they use that license over its life, no competition will be able to “steal” their market. Thus, it is perfectly conceivable that, rather than stimulate innovation, IP may very well stagnate it by allowing a single firm to dominate a market – not by its continuous service to the consumer, but by its sole ownership of the legal license. Thus no work at all – whether productive or unproductive – is implied in the concept of IP. It is simply favor and force: favor to receive the entire market (as defined by the govt), and force to keep others out. Firms of course MAY use the license to work harder, but they may not do anything. They may simply apply for and be granted a patent, for example, so that their competition will not be able to use it. My point is that it’s a mistake to associate work or productivity with IP.

Ben September 17, 2010 at 5:50 pm

So what about restauraunt like Chili’s, Fridays, Applebees. All serve the same basic fare with the same basic concept. Tacky restauraunts with crappy food that costs way more than you could make it at home. So whoever came up with the idea of charging a lot of money to sit in a tacky restaurant and eat overcooked food should be suing all three of them. Oh wait, restaurants have been doing that forever! The whole notion that ” I came up with it first” is so childish I can’t even began to expand on it. It’s the same as screaming “but teacher he hit me first.”

Abhilash Nambiar September 17, 2010 at 6:00 pm

Why not let the Chili’s customers decide if Applebees deserves a cut because they are trying the same crappy concept but Applebees came with it first? Why do you want to decide it for them? I mean if innovations are valued in the market place, should there not be a mechnism so that market participants can more directly express their approval for the innovator. If there is demand for such mechanism and it is met, what would that do to copyrights and patents?

Nathan September 18, 2010 at 9:42 am

Are you suggesting that Chili’s customers can’t decide to do this? They are free to write checks to Applebees for every visit they make to Chili’s. Or Chili’s can put out a collection bowl. Or Applebees can write to Chili’s and ask to be compensated, and if Chili’s agrees, they’ll pass on the higher prices to consumers.

I certainly hope you haven’t been laboring under the delusion that IP opponents want to positively forbid compensation of this nature. Whatever two people or entities wish to work out between themselves on a peaceful voluntary basis is fine. You seem to oppose state IP, yet still demand a “mechanism” to compensate IP creators. Again, if such mechanism is voluntary, no one has any problem with it. There have even been suggestions for “artist approved” stamps and other such ideas on this board. But you keep talking about the need to compensate innovators without ever being clear as to whether you want this to be voluntary or enforced by violence.

Reflex September 19, 2010 at 2:30 am

I wonder who invented Hooters? I see copies everywhere. All the time.

Bruce Koerber September 17, 2010 at 6:28 pm

With the money now flowing from Georgia to Wisconsin to the Johnsons now the Johnsons will be able to pay the inventor of the sod roof who in turn will pay the cultivator of sod grasses from their wild ancestors.

Stop this nonsense! Entrepreneurship allows the alertness of someone to benefit others but it is fleeting, superceded by more alertness which benefits others and so on and so on. No one has a legitimate claim of ‘creator’ except God and God does not need.

Abhilash Nambiar September 17, 2010 at 7:59 pm

I will keep theology for later. But the idea that the inventor of the sod roof could get compensated as more and more people begins to use his invention holds appeal. It is a good environment, one in which people are competing to make things and where people who value and appreciate them by paying. I do not think patents and copy rights do it, but what you suggest does not sound too nonsensical to me. And why not? There is such a system in place for people who distribute real goods, why not such a system for those that help make better use of real goods. They are not creating scarcity. Their talent goes into developing efficient ways to manage scarcity. What is wrong with compensating them in proportion to benefit people derive from their innovation in the free market? There is no intellectual monopoly here and no intellectual property either, just intellects compensated in proportion to the service rendered. By the way my argument does not apply for dead innovators if you notice.

Bruce Koerber September 17, 2010 at 8:32 pm

As long as that contribution to the betterment is attributed to that entrepreneur they will be able to capture that compensation. At some point though it will take on ‘a life of its own’ so to speak where other entrepreneurs will find ways and means to benefit others and that also deserves compensation which, too, will be fleeting.

Abhilash Nambiar September 17, 2010 at 9:11 pm

Just because ideas will take a life of its own does not mean that there should not be a mechanism to reward those that market credits with pioneering the idea. If such a mechanism contributes to market efficiency it too will take a life of its own, provided of course the government does not clamp down.

Bruce Koerber September 18, 2010 at 7:29 am

Agreed. The market is inherently just and needs no feeble (and foolish) human attempts to perfect (just causes a corruption) it.

Shay September 18, 2010 at 8:38 am

It seems your basic position is that there are things that are beneficial for people to be doing, and they should be compensated for this so that they are encouraged to do these things. If there is some good activity that isn’t compensated, then we have a problem. Does this summarize it well?

The problem is in your definition of what is good. Different people value different things. If you asked X what things should be compensated, he’d give you some list, but if you asked Y, he’d give you a different list. You might be able to ask everyone and apply some weighing function to make a master list that describes how much each activity should be compensated, such that this gives the greatest overall benefit to everyone.

But this one-size-fits-all list will not be the best possible compensation available. If you broke everyone into smaller groups, and did the same for each group separately, each list would differ slightly and give an even better benefit, since it would take into account regional differences. If you took this to its limit, each person would have his own list and compensate accordingly. And this is exactly what the free market is.

You may then say that a certain activity still isn’t compensated appropriately, but you’re not taking into account the costs on everything else if appropriate compensation is provided via some added mechanism. You’re also not taking into account the cost of interfering with the market, and the further interference that leads to. There’s no stopping the endless streams of special interests who want their activities compensated more. Eventually you don’t have anything like a free market anymore.

Bruce Koerber September 18, 2010 at 9:32 am

I am not sure if this comment was directed to me or not: “It seems your basic position is that there are things that are beneficial for people to be doing, and they should be compensated for this so that they are encouraged to do these things. If there is some good activity that isn’t compensated, then we have a problem. Does this summarize it well?”

“and they should (I recommend replacing ‘should’ with ‘would’ since the market works) be compensated for this”

“If there is some good activity that isn’t compensated, then we have a problem.” There is imperfect knowledge so that is a possibility but never will the flow of knowledge be improved upon by muddling by humans who cannot even remotely perceive the infinitely complex market process.

Shay September 19, 2010 at 5:02 am

Bruce Koerber: sorry, I was replying to Abhilash Nambiar. I figured the indention of replies would have made that clear, but I guess people don’t always click the correct reply button, so that indention doesn’t always disambiguate (and of course the limit on reply depth, but that hadn’t been arrived at, though it has been for this reply).

Art Thomas September 17, 2010 at 9:35 pm

Abhilash Nambiar said:

“Maybe positive externalities and profits are adequate for some. But if the real world is something to go by, innovators are looking for something more concrete and more certain in the form of compensation. I have no doubt that the market can address this.”

In your most thoughtful imagination what is this something more concrete and more certain than externalities and profits that innovators are looking for? Are you suggesting that if the market would somehow provide innovators with this mysterious something that patents and copyrights would eventually disappear?

On the other hand, what compensation could be more concrete and certain than being protected from the power and the uncertainty, indeed the fickleness, of the free market itself?

Bruce Koerber September 18, 2010 at 7:32 am

The certainty that you suggest comes from human intervention into the economy is the certainty of corruption.

Art Thomas September 18, 2010 at 3:19 pm

That’s for sure.

Stephen Adkins September 18, 2010 at 7:01 pm

This is more of a general question, but I’ve recently been thinking about the guy who is credited with inventing the sideways smiley face :-) In this post from his website,

http://www.cs.cmu.edu/~sef/sefSmiley.htm

he describes when and why he came up with the idea.

It seems to me that a) this was a definite example of what Abhilash has been calling a “first mover.” B) This also strikes me as (im being completely serious) a substantial innovation in human communication. There was a lack in the ability to convey nonverbal communication over the internet, and this one man (perhaps at the tail-end of a long night of agonizing over the R&D process) had a moment of clarity; he applied his specific knowledge to a specific problem, and somehow the product of his intellectual labor swept through his department at Carnegie-Mellon. And look where it is today. Consider how many stinking times a day that little series of characters (or some derivation thereof) is used. Not only on the internet, but in text messages as well. His genius was to have the reader turn his head sideways. Thus he should in all justice be credited not only with the “smiley face,” but for all sideways faces. There can scarcely be a better example, in my opinion, of a first mover.

Shouldn’t he be compensated for his contribution? He has made so much more convenient, and in many ways clarified, millions of conversations between millions of human beings the world over for close to 3 decades now. He’s in his early 70′s right now, and I guarantee you he has on occasion stopped to reflect on what must be a bizarre sensation: “Millions of people I will never meet use this symbol I came up with as a half-joke 30 years ago. It has taken on a life of its own and is as much a part of the languages of the world as English is.” Yet I’ll bet he’s never been paid a dime for this.

Shouldn’t the law step in and fill this gap in the market?

Nathan September 18, 2010 at 11:03 pm

“Shouldn’t the law step in and fill this gap in the market?”

It all depends on how you phrase it. If instead you write “Shouldn people be forced to pay a fee to type a colon and a right parenthesis in succession on their own computers because someone else did the same thing on his computer 30 years ago,” the answer is obviously no, unless you also think that you should be paying royalties to the descendants of the caveman Ogg every time you use a wheel.

Stephen Adkins September 19, 2010 at 12:38 am

I agree Nathan. I’m hoping an IP apologist will say “no” and then tell me how it’s different than the restaurant with the goats.

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