It’s really something how much growing opposition there seems to be to intellectual property, particularly patent and copyright. I suspect one thing that is happening is as technology ever-more-rapidly changes and becomes part of our world, and with the digitization of information and media, and the Internet, the costs and injustices that have been caused all along by patent and copyright are becoming more visible and perhaps more extensive. So there is a rising chorus of people–especially young people–who just say, “That’s just BS!” Think about it: pretty frequently there is some commentary about some IP abuse or horror story; but you almost never hear any defense of IP, or any example of its supposed success stories. The only advocates of IP seem to be Disney’s lawyers.
Case in point to the changing IP climate–I just received, out of the blue, a call from Jesse Brown, the host of the Canadian CBC (their version of NPR) radio program “The Contrarians” — “a radio show about unpopular ideas that just might be right. Each week, host Jesse Brown invites listeners to step outside of their intellectual comfort zones and try an unorthodox opinion on for size. You may be surprised by what starts making sense.”
He was aware of my anti-IP views (no doubt due to the growing prominence of Mises.org) and that I’m a patent lawyer, and interviewed me for about 20 minutes, furiously taking notes. I think they are considering doing a show on this. What I found striking was how intelligent his questions were, and that he was perfectly okay with my focus being based on a principled, libertarian, property rights view–not the standard wealth-maximization/utilitarian type argument. Anyway, stay tuned!
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Artisan:”See, I feel somehow you can’t TRULY identify the author of a functional solution.” You’re probably right. Patent’s can’t work as cleanly as copyright. I think that may be why patent law doesn’t try to identify the real owner of a solution, but the owner who mixes labor and capital in the process of instantiating that solution.
Fred:”IP necessarily shifts innovation from the hands of the many into the hands of the few.”
I don’t see that as being the case. Most patents are for incremental changes by the inventor. If someone else makes an incremental change to my invention, I don’t see why I would not be able to patent that change.
“It outlaws small innovations in order to grant favor to larger innovations.” The history of patents proves that statement wrong.
Currently, a lot of new products come from the private sector because they can get a patent, but many come from government-financed research. The fuel cell industry, for example, got started because of NASA research. Entrepreneurs didn’t have to invest the capital into the initial R&D. Once NASA had the technology to a workable stage, private companies took that research and advanced it further. NASA saved them an enormous amount of R&D costs, which the fuel cell entrepreneurs don’t have to worry about repaying. If you kill patent protection, you will kill private research and strengthen the hand of government. The government will decide what areas are worthy of research.
Roger M says;
“Here’s the problem: When entrepreneurs make products without IP protection, their only investment is in the manufacturing plant, labor and inventory. Competition will reduce the price of the product until the entrepreneurs will earn an average market ROI on that investment. Now if the inventor tries to produce the same product, he has an additional expense–R&D. The price competition from the manufacturers who don’t have the burden of the R&D expense will force the inventor to keep his prices at or below those of the competition, leaving him a return on his manufacturing investment, but none on his R&D.”
Not necessarily true. There is more than one way to earn a premium on a product. A patent monopoly is one, a high-quality or high-feature product another, a niche or custom product another, and so on. I am sure there are others.
All that the elimination of patents (I have yet to come around on copyrights Stephan, keep trying though) will do is flatten out the capital investment landscape, which, I would contend, while possibly a bad thing for a few big organizations and “BIG” ideas, will turn out to be neutral or even beneficial for r&d by small entrepreneurs working on smaller problems.
As a side effect, SOME complex products might have their commercialization delayed, again, BFD. While fuel cells might have some commercial application, they are a long way from mass consumer use, and might never get there, patents or no, since they involve so many technical hurdles.
I’ll give another example. Nuclear fusion is the holy grail of power generation, because an economic, commercial technology will mean cheap (Remember the talk in the early Atomic Energy era about producing electricity “too cheap to meter”), non-greenhouse-gas-emitting energy. But where is (government) nuclear fusion research being directed – toward large-scale applications that will be controlled by a few gigantic utility companies, or toward small micro or nano-scale applications (which, say, I would favor)?
Favoring a particular innovation, or class or line of innovation involves a value judgement, period. It does not give rise to a property right that should be backed by government force.
Me:”IP necessarily shifts innovation from the hands of the many into the hands of the few.”
Roger M:”I don’t see that as being the case. Most patents are for incremental changes by the inventor.”
But at some point, an improvement will be deemed “too small” – arbitrarily, of course. For example, if I change the composition of the metal used in a small pin on a very large and complex machine, but everything else remains the same, I have almost certainly commited an IP violation, even if the pin IS, in fact, an improvement. If this is not the case, then IP is effectively rendered useless as it can easily be circumvented with any small change. Of course, I believe that this improvement *would* be deemed a violation. Therefore, “small” (always defined arbitrarily by IP law) innovations *ARE* illegal. So my statement still stands. “Small” innovations are outlawed. Of course, “small” innovations are the most common type of innovation. Most people don’t have revolutionary ideas every day (I am the exception). So outlawing small innovations effectively blocks the most common type of innovation. What do you think is the cumulative effect of outlawing these millions (billions?) of tiny innovations over time?
As an interesting side note, consider the effect that IP has on R&D. IP necessarily removes some incentive to improve the efficiency/cost-effectiveness of R&D. Therefore, R&D costs will almost-certainly be higher under the IP regime. (This is not in and of itself a reason to eliminate IP. It’s just an often overlooked point).
Fred–good comments. I honestly think most people out there are blithely unaware of the horrible and tremendous costs of the patent system–how many small and medium-size tech companies live in daily fear of getting shut down by a competitor or extorted for royalties. There is a patent minefield out there that threatens all of us. There is nothing you can do to stop it or even be sure you are safe (not infringing). The gyrations and expense and maneuvers companies go through in a desperate attempt to stave off a business-ruining patent suit are just horrible, horrible, terribly expensive and inefficiency-causing. Most normal people who advocate patents are ignorant boobs, I believe, who know not what it is they are advocating.
Stephan,
With this: “Most normal people who advocate patents are ignorant boobs, I believe, who know not what it is they are advocating.”
You are too kind. Most people, advocating anything beyond nothing, are ignorant boobs who know not what it is they are advocating.
See above in the context of: Government Intervention.
Are there any pro-IP people out there who want to challenge my comments, or are you all convinced now?
Nah, I’ve used the smallest words I can to explain these basic concepts to you. I don’t think I can bear having to make it even simpler.
Good one.
Are you referring to your “there’s ‘scarcity’ in IP” argument from the previous thread, in which I showed that you used two entirely different definitions of “scarcity” interchangeably, or are you referring to your “consequentialist” views which I addressed above?
P.S. Here is a link to the blog where Person argues that there is a kind of “scarcity” in intellectual property: http://blog.mises.org/archives/005196.asp .
This particular argument really develops in the last third of the blog (or so) for those that don’t want to reread the whole thing.
If ANYONE can argue logically that I am wrong, feel free.
Fred: As an impartial, objective, neutral, third-party arbiter and the Founder of the Thread, I hereby do Officially Declare you to have Completely Thrashed Mr. Person.
Do let it be known to all and sundry.
I have to agree with you, Stephan (impartially, as well). It’s got to be SOOO frustrating for Person — being unable to explain his brilliant ideas to us little children.
But I’d still like to hear actual arguments from IP supporters if they have anything new to add to this thread or any of the other IP threads.
I’ll even give them a head start…
IF we accept the consequentialist/utilitarian view, one could still make the case that I don’t KNOW that “the cumulative effect of outlawing these millions (billions?) of tiny innovations over time” (as stated in previous post above) will be worse than the situation that would exist without IP.
Any takers? This is not a trap – I actually think it’s an avenue worth pursuing.
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