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Source link: http://archive.mises.org/8380/inventors-are-like-unto-gods/

Inventors are Like Unto …. GODS…..

August 7, 2008 by

Recently, re-listening to the 1991 lecture “Ayn Rand, Intellectual Property Rights, and Human Liberty,” by Objectivist attorney Murray Franck, I was struck by one of quotes given in defense of IP. During his lecture, Franck reads (most of) the following quote approvingly:

“When we come to weigh the rights of the several sorts of property which can be held by man, and in this judgment take into consideration only the absolute question of justice, leaving out the limitations of expediency and prejudice, it will be clearly seen that intellectual property is after all the only absolute possession in the world. The man who brings out of the nothingness the child of his thoughts has rights therein which cannot belong to any other sort of property. Land or chattels are pre-existing in some form, and the rights therein are limited in many ways, and are held in the great service of the world, but the inventor of a book or other contrivance of thought holds his property, as a god holds it, by right of creation; with his silence or inaction the sustenance and advance of millions yet to be may vanish into the great darkness again. His brain has brought the seed out of the infinite, planted it in good soil, tended it with the care that only the sower can feel. Surely the world should not deny him a share of the increase he has brought about, and if he, giving the reversion of his property for all time to his race, is granted the product of his creation for half a score of years, he should surely be secured against being plundered by the law as well as by the lawless.”

Franck says the quote is from one “Forvold Solberg” [sp?], “a former register of copyrights”, but my google-fu indicates that the author is one Nathan Shaler, Professor of paleontology and geology at Harvard from 1869-1906, in his Thoughts on the Nature of Intellectual Property, and Its Importance to the State (1878). It’s perhaps a bit ironic that the author quoted approvingly by an Objectivist in support of IP was a racist, one-time Creationist, and author of a book about some idea’s “importance to the state”!

In any event, the latter part of the quote is extremely utilitarian: “the world” should give the innovator or creator “a share” of the wealth he contributes… by giving him a monopoly on it for about ten (“half a score”) years. [For some other choice quotes by Franck during the lecture, he recounts that when he met Rand, when she learned he was an IP lawyer, she told him, "Intellectual property is the most important field of law." Franck also writes: "Man requires property rights to survive, physically and spiritually. That is, as a full-blown man. In the words of Citibank, 'to succeed, not just survive.' As we have discussed, if the creator's rights are not protected, his survival is jeopardized. If another can market his creation, the creator is deprived of the money he wold otherwise earn. That is, his means of production through trade, and therefore of survival. In effect, the creator's personality has been destroyed. For if the infringer can market without the creator's permission, he has substituted the creator's life in the market place by substituting the results of the creator's energy, thought, time, and action. Creation is the criterion of earning and therefore of ownership."]

The first part–about how inventors are “like gods” calls to mind Rand’s embarrassing justification for smoking–that it’s symbolic of fire “tamed” at man’s fingertips.

The quote also emphasizes very explicitly that Randians and other IP advocates believe “creation” is an independent source of rights: you hold your intellectual creation like a god, “by right of creation.”

I note also that Franck says in the lecture that copyrights should survive in perpetuity.

Incidentally, I graduated from law school in 1991, the year of this lecture, and listened to it soon after, about the time I was beginning to practice IP law (1993 or so). I had recently morphed from an initial flirtation with Objectivism to Rothbardian anarcho-libertarianism. I was very interested in this lecture, since I had long struggled with Rand’s weak justification of intellectual property–which was especially troubling since she claimed thatpatents are the heart and core of property rights.” The lecture failed to convince me; I kept searching for better justifications of IP than I’d seen from Randians. After shooting blanks for a few years, I finally came to the realization that I was unable to find a justification for IP … because it’s unjustifiable and contrary to individual rights. By 1995 I had reached my current views on IP, as can be seen in this exchange between me, Franck, and David Kelley, in the IOS Journal: Murray I. Franck, “Intellectual Property Rights: Are Intangibles True Property,” IOS Journal 5, no. 1 (April 1995); Kinsella, Letter on Intellectual Property Rights, IOS Journal 5, no. 2 (June 1995), pp. 12-13; David Kelley, “Response to Kinsella,” IOS Journal 5, no. 2 (June 1995), p. 13; and Murray I. Franck, “Intellectual and Personality Property,” IOS Journal 5, no. 3 September 1995), p. 7 (all of these except the first are here; I find only this bad link to Franck’s first piece).

{ 81 comments }

nick gray August 7, 2008 at 2:06 am

Stephan, maybe you can answer a point which was raised in Australia, by me, to anti-IPers? This is a valid point, and if non-IP can come up with a similar product, you’ll win over many people.
Pharmaceutical companies often take years to develop a new drug, and recoup their costs by having years of monopolies. Without IP, would we have, for instance, Viagra now?

Haas August 7, 2008 at 4:29 am

Ok so Dan brown writes a new book called the da vinci code- can i just take off the covers front and back put my name on it and resell it? if the publishers get it from me much cheaper than dan brown himself why not? according to you that would be ok…

ee August 7, 2008 at 6:17 am

If those are the best arguments for IP then this battle is already won.

Peter August 7, 2008 at 6:25 am

if the publishers get it from me much cheaper than dan brown himself why not?

How would they get it from you cheaper than from Dan Brown? You don’t have it until after it’s already been published – the publishers already have it before you do, obviously, or you wouldn’t have it at all, so why would they pay you for another copy?

ktibuk August 7, 2008 at 7:16 am

And what is wrong with the quote exactly?

The authors views about race or how the universe came about or whether he was an anarchist or a statist is irrelevant.

But to someone like Kinsella, with no tangible argument, using logical fallacies, ad hominem in this case, is not only normal but necessary.

Geoffrey Allan Plauche August 7, 2008 at 10:27 am

“The first part–about how inventors are “like gods” calls to mind Rand’s embarrassing justification for smoking–that it’s symbolic of fire “tamed” at man’s fingertips.”

What’s embarrassing about that?

Person August 7, 2008 at 11:00 am

@Haas: IP is a separate issue from plagiarism. In a world without IP, people wouldn’t have to claim the work as their own; they would freely admit it’s a work of Dan Brown, and that they’re copying it.

@ee: And if the best argument to show how EM spectrum rights are different from IP, is that OBVIOUSLY, the OBJECTIVELY RIGHT “relevant use” of the EM spectrum is to transmit information rather than just mere radio waves, then the battle for IP is already won.

@Peter: *some* people have bought the book already. But if everyone beyond about the first week of sales got it from a copycat, that means the profis are very low, and best, AND — here’s the kicker — would not come close to reflecting the actual demand for such books.

Did someone say “economic calculation argument”? And please don’t respond by defining away the problem.

Per-Olof Samuelsson August 7, 2008 at 11:59 am

And how about reading Ayn Rand’s own view on the subject? There is a chapter on “Patents and Copyrights” in “Capitalism: The Unknown Ideal”.

fundamentalist August 7, 2008 at 12:43 pm

nick: “Without IP, would we have, for instance, Viagra now?”

Keep in mind that there are two groups of IP opponents. One opposes IP on “ethical” grounds. That group doesn’t care about practical arguments. For them IP is evil by definition and therefore must be abolished at all costs.

The second group opposes IP and patents because they think it stifles innovation and technical progress. You can actually discuss things with this group. They are probably right that IP does stifle innovation to some degree. But let’s separate the invention from the development part. Without IP, inventors of new drugs would have to rely upon the generosity and public spirited nature of the wealthy to finance research on new drugs because no entrepreneur will do it without a profit incentive. We would revert to the pre-capitalist mode of financing inventions where inventors were patrons of the nobility. After a new drug was invented, entrepreneurs may step in and produce it if sufficient barriers to entry by competitors exist in terms of capital and expertise. The entrepreneur would have the advantage of having invested no money in the research. His profit would come from his expertise in business organization and manufacturing.

So, in short, yes, Viagra may still exist without IP. We just wouldn’t rely on the profit motive for its invention, just the charity of the wealthy.

Stephan Kinsella August 7, 2008 at 1:28 pm

Plauche:
“‘The first part–about how inventors are “like gods” calls to mind Rand’s embarrassing justification for smoking–that it’s symbolic of fire “tamed” at man’s fingertips.’”

“What’s embarrassing about that?”

It’s so ridiculous I don’t know where to start. It’s self-important. It’s an obvious attempt to justify–even glorify–a nasty, unhealthy habit. It exemplifies the Randroid habit of melodramatically over-glorifying “Man” and elevating every personal preference into Holy Writ. And smoking is trashy.

rtr August 7, 2008 at 1:36 pm

fundamentalist: “Without IP, inventors of new drugs would have to rely upon the generosity and public spirited nature of the wealthy to finance research on new drugs because no entrepreneur will do it without a profit incentive.”

That’s why barber’s have to cut customer’s hair without permission while they are asleep and then demand payment when they wake up. That’s why painters have to paint your house without permission when you are away at work, and then demand payment when you arrive home from work. That’s why grocery stores have to put an unsolicited random supply of grocery goods on your doorstep with a bill, ring the doorbell, and run away.

What a ridiculous erroneous assumption fundamentalist makes. Who is ultimately going to pay for the drugs? Patients. All the market needs to solve any research and development funding problems is to adopt a service model connecting scientific researchers with patients, and friends and family of patients. If they want to pay for drug research (which they would have to anyway in a violently enforced government monopoly patent system), they are free to do so, or not, as they please. And discovers will have a brand name edge that can garner a higher price per pill than the no name, possibly riskier, competition.

There’s plenty of willing and able researcher scientist competition willing to put forth their resumes and be paid handsomely to work on finding cures for all sorts of diseases and ailments. There’s no need for an inefficient drug company middleman that only searches for cures that can be patented (eschewing vast swaths of potentially more efficient and far cheaper solutions), that only searches for cures that require hooked repeat business customers, and that price gouges as one of the most excessively obscene margin profit monopoly business models ever devised.

All IP is trespassing on the real property of others, is a theft of the full use of private property, to be shaped in any damn way well the owners of private property please.

I’ve never seen a proponent side of a debate just so thoroughly and quickly smoked on the merits of the argument, as IP proponents. It’s hard to believe people here are still unaware that there is no justification, economic or ethical, whatsoever for IP.

If IP was working, why do we still charity telethons? Why do we still see 10k runs and walkathons for things like breast cancer?

As genetics technology advances, it’s going to become ever easier and cheaper to cure all sorts of ailments. Yet IP sanctioned drug cartel companies are going to front run this technology, and gouge the hell out of the rest of the world, as they use government intervention to shut out competition. We can see the future of medicine just by observing the future of farming and Monsanto.

Florida Economist August 7, 2008 at 1:49 pm

There is nothing inherently wrong with the existence of IP. Though like with everything else, our nation of attorneys and corporations have gorged themselves on it. IP has become a cost of doing business (both offensively and defensively), for some their only business, it is a game of chess without any regard to who actually creates the property in the first place. With enough money, the right courtroom strategy and only a slight similarity between two sets of IP, a good attorney can legally steal complete IP right out from under the feet of the defender. I am not an attorney (as if that wasn’t obviously) so I can not voice a defensible position on types of IP and their worthiness. However as a strategist I can say very definitively that the lawful abuse of IP, not IP itself, has weighed heavy on innovation and thus the benefits that society may receive. It has slowed innovation down and made it far more costly than it needs to be.

Larry N. Martin August 7, 2008 at 2:15 pm

Walt Disney is long-dead. Free the Mouse!

Geoffrey Allan Plauche August 7, 2008 at 2:23 pm

“It’s so ridiculous I don’t know where to start. It’s self-important.”

So?

“It’s an obvious attempt to justify–even glorify–a nasty, unhealthy habit.”

Really? I don’t really follow cig politics and science all that closely. When Rand first made this comment was it widely known just how unhealthy smoking is?

Certainly I don’t like the smell. There are better smelling cigs (like cloves), cigars and pipes though.

Even though it’s unhealthy, it is a personal choice weighed against the pleasure of smoking. Who are you to denounce it, Mr. Thin Libertarian?

“It exemplifies the Randroid habit of melodramatically over-glorifying “Man”"

This is a reaction, at times an over reaction, to the modern tendency to treat “Man” as no better, even worse, than other animals (even bacteria). As an atheist, I’m not against a little corrective glorification of Man. It can be overdone and sometimes is in Objectivism. There is an element of Enlightenment rationalism in Objectivism.

“and elevating every personal preference into Holy Writ.”

You’re right there, but this is not necessarily inherent in saying that smoking is symbolic of Man’s taming of fire.

“And smoking is trashy.”

Not if you use cig holders! :D

rtr August 7, 2008 at 2:55 pm

I also want to add to my comment above that doctors can be customers of drug research scientists too. Doctors order all sorts of medical equipment with which to run their practice. They subscribe to newsletters and journals. There’s no reason they couldn’t subscribe directly to research scientists as well, to remain at the cutting edge (no pun intended). Ten doctors could probably fund 1 full time research scientist. And those ten doctors could put some advertisement research association sticker on their door to advertise they are not only at the top of current medical technology, but directly investing in future medical technology.

And as it is now, plenty of University hospitals are research hospitals. Just exactly where are those research results? Oh that’s right, paying Michelle Obama’s $900,000 diversity community outreach part time job.

Curt Howland August 7, 2008 at 3:07 pm

So, in short, yes, Viagra may still exist without IP. We just wouldn’t rely on the profit motive for its invention, just the charity of the wealthy.

Absurd. First of all, in the time between releasing Viagra and its reverse-engineering, development, production and delivery of the competition, the maker of Viagra gets to charge monopoly prices.

Once competition does begin, the original producer gets to undercut the price of the competition because their development process is already paid off (having been able to charge monopoly prices that the competition cannot charge), as well as having the benefits of an established reputation in that market.

One might as well as why Bayer still produces asperin, and makes a profit doing so, yet asperin has no IP protection what so ever.

hl August 7, 2008 at 3:16 pm

It’s an obvious attempt to justify–even glorify–a nasty, unhealthy habit.

Whoa! Hold on. Surely you meant to say “it’s an obvious attempt to justify — even glorify — a habit that I, St. Kinsella, find nasty and unhealthyt.”

Jardinero1 August 7, 2008 at 3:36 pm

I am with RTR. I think the drug company example is a canard. It’s far from a foregone conclusion that drug companies improve our lives or health in any substantive way.

Ninety nine percent of the gains in health and longevity of the last hundred years are the result of clean drinking water, sanitary sewers, childhood immunizations, elimination of infection and improvements in home and workplace safety. The few drugs that contributed to the above – childhood vaccines and penicillin – were not the product of an IP regime but of philanthropy.

The signature health problems of our day: heart disease, cancer, diabetes occur, mostly, later in life and are either hereditary or the end result of bad lifestyle choices made when young. The drug companies use their monopoly power to nibble at these edges providing very expensive solutions that extend life or improve health very slightly.

Walt D. August 7, 2008 at 3:59 pm

In the drug case, the major cost is the cost of the FDA mandated clinical trials. It would seem that we could do without the IP patent if the FDA insisted that any other drug company reverse engineering the drug would have to do their own independent clinical trials. This would work for the US market. However, it would allow other countries to free load.

Person August 7, 2008 at 4:00 pm

Curt: Absurd. First of all, in the time between releasing Viagra and its reverse-engineering, development, production and delivery of the competition, the maker of Viagra gets to charge monopoly prices.

Okay, so … six months’ worth (and of course, people figure they can just hold out until the ten-cent version is released)? The reverse-engineering time is zero because it’s a) just a recipe for making a pill, and b) they can secretly buy the formula from any one of the thousands of people who have access to the it. Codes of silence don’t work if all it takes is one person to let the genie out of the bottle.

So, Curt, are you okay with even the most POPULAR new medicines, only being developed if the six-month monopoly price justifies it?

Gee, I sure hope Mommy doesn’t get any kind of niche health problem.

(Btw, I thought your position was to dismiss the relevance of profitiability of producing intellectual works entirely, and just be content with the charity works, like Linux? Note, I’m asking, not assuming.)

One might as well as why Bayer still produces asperin, and makes a profit doing so, yet asperin has no IP protection what so ever.

One mightn’t not. The profit Bayer makes is on the labor involved and the brand equity, not on the intellectual work better known as the formula for aspirin.

Person August 7, 2008 at 4:12 pm

Walt D.: Do I have to refute that argument again?

Yes, the FDA pumps up R&D costs unnecessarily. (There would still be certification costs of course, but I accept that the FDA still makes them much higher.)

But research costs NECESSARILY go up over time, as part of the universal law that people (indeed, any successful self-replicator) seek the lowest-hanging fruit first.

So, let’s say that today, if there were no patents, and no FDA, drugs could still get cranked out because the loss from no patent is canceled by the gain from no FDA.

What about after 50 years of increasing costs? What’ll be your excuse then, for why no one wants to develop drugs?

Walt D. August 7, 2008 at 4:47 pm

Stephan
Suppose I go into the Mises Bookstore and buy a copy of each book. Are you saying that I should have the right to make an electronic version of each book and make it available on my website for free or charge a nominal fee?

Henry Miller August 7, 2008 at 4:56 pm

A large part of the cost of a new drug is pay for by charity today. Until it gets into trials few companies are actually willing to pay. Many drugs fail trials (either they don’t work, or they work, but the side effects are worse than the disese).

Alcibiades August 7, 2008 at 5:59 pm

Why is the development of pharmaceuticals always used by IP partisans as though it presents a convincing example of the need for IP? Many (if not most) of the drugs currently in development are designed to treat pseudo-disease (eg, ADHD) or to treat conditions which can be treated without pharmaceuticals (eg, sleep aids). Moreover, if IP is necessary for pharmaceutical companies to realize a profit why does the industry spend billions each year on direct-marketing to potential end-users rather than R&D? It’s because, again, many of the drugs being developed and marketed are luxury items, or worse, are inferior to existing treatments but offer the fantasy of improved health or quality of life in one little pill.

Jim C August 7, 2008 at 6:30 pm

Walt D.

Sorry but I think mises.org beat you to the punch, with over 2,000 books and articles posted for free download and more constantly being added.

Marcello August 7, 2008 at 7:15 pm

Walt,

why would that be bad?

Lowell Sherris August 7, 2008 at 7:55 pm

Nick Gray

Pharmaceutical companies often take years to develop a new drug, and recoup their costs by having years of monopolies. Without IP, would we have, for instance, Viagra now?

We probably wouldn’t have Viagra. Most likely, we would have a choice of better, safer, and less expensive alternatives.

IP and intrusive government in the form of the FDA are the reason we have such limited choices in pharmaceuticals at such ridiculous prices. The reason pharmaceutical companies take years and more than a billion dollars to bring a drug to market is FDA requirements. It is so expensive and difficult to bring drugs to market that literally only a handful of companies do so. When small companies try to develop drugs, they do so with the expectation that the drug (or the entire small company) will be bought out by a big company if they are successful.

There is actually very little innovation in the pharmaceutical industry. Many of the drugs that are approved are actually rehashes of old drugs with small modifications put in place since the patent monopoly is scheduled to expire. See this link: http://money.cnn.com/2007/03/21/news/companies/drug_patents/index.htm?section=money_latest

It is very common for drugs that go off patent, such as Zyrtec, to then be sold over the counter. If the purpose of requiring prescriptions was to protect the public from potential side effects or abuse of dangerous drugs, how did these drugs become less dangerous after the patent expires? The obvious answer is that the requirement of prescriptions benefits physicians, pharmacists, and mainly pharmaceutical companies.

Because of the huge cost of developing drugs, many companies or scientists try to play it safe by avoiding investigating long shots. Remember how important the unseen is in evaluating the effects of human action. Without IP there would undoubtedly be more investigators taking chances,and hence more innovation. IP also prevents innovation by scaring investigators away from promising findings if they believe there is a possibility of infringing on someone’s patent. Many people and their attorneys make good living by getting patents and waiting for someone to accidentally infringe.

I ask this question to my IP loving friends. If the Wright brothers had been given a patent for their aeroplane, is there any possibility that aviation would have developed as rapidly as it did? It only took 14 years for aviation to progress from the first flight 12 feet off the ground to the Red Baron having dog fights in a fairly sophisticated plane.

As a physician, for the most part I have seen only minimal improvements in the efficacy and safety of most new prescription medications at a time when the cost has sky rocketed.

Andras August 7, 2008 at 8:26 pm

Hey guys, why don’t you ask the creative genius if he still want to invent under the new conditions? How many of you ever invented anything? Most of the opponents of IP can not even distinguish between inventing and manufacturing. Don’t they just try to confiscate IP? Is there any historical precedent for mass invention without IP? Is the existing system so bad that you would risk a total Atlas Shrugged?
I the inventor of drugs (life saving antibacterials not recreationals like viagra) surely think twice not to mention the investors who risk billions for decades to develop a new (and better by definition) one.

Lowell Sherris August 7, 2008 at 8:37 pm

Andras

Is there any historical precedent for mass invention without IP?

How about fire, the wheel, writing, mathematics, Greek drama, Roman literature? This is similar to asking whether there is a historical precedent for a truly free market. The answer is no, but it certainly sounds like a good idea.

Is the existing system so bad that you would risk a total Atlas Shrugged?

Damn straight!

I the inventor of drugs (life saving antibacterials not recreationals like viagra) surely think twice not to mention the investors who risk billions for decades to develop a new (and better by definition) one.

You mean like Sir Alexanda Fleming who discovered penicillin and then didn’t file for a patent. How many unseen scientists are prevented from doing research because of the high cost of research directly related to the patent system and FDA regulation?

Stephan Kinsella August 7, 2008 at 9:10 pm

Andras: “Is there any historical precedent for mass invention without IP? ”

See my The Intellectual Property Quagmire, or, The Perils of Libertarian Creationism [PPT, 32MB], slides 70-71:

[Economic historian Eric Schiff] looked at countries that got rid of their patent system (Switzerland and the Netherlands), and found it INCREASED innovation because there was MORE competition in the marketplace. That is companies focused on making more goods for the market, rather than focusing just on patenting things and not having to compete in the market. “Switzerland and the Netherlands eventually adopted patent laws in response to threats from other industrialised nations. This, Schiff argues, was a political decision, not an economic one. It is, he notes, “difficult to avoid the impression” that the absence of patent laws “furthered, rather than hampered development”.”

Petra Moser found that countries without patent systems innovate just as much, if not more, than those with patent systems. “This paper introduces a new internationally comparable data set that permits an empirical investigation of the effects of patent law on innovation. The data have been constructed from the catalogues of two 19th century world fairs: the Crystal Palace Exhibition in London, 1851, and the Centennial Exhibition in Philadelphia, 1876. They include innovations that were not patented, as well as those that were, and innovations from countries both with and without patent laws. I find no evidence that patent laws increased levels of innovative activity but strong evidence that patent systems influenced the distribution of innovative activity across industries. Inventors in countries without patent laws concentrated in industries where secrecy was effective relative to patents, e.g., food processing and scientific instruments. These results suggest that introducing strong and effective patent laws in countries without patents may have stronger effects on changing the direction of innovative activity than on raising the number of innovations.”

For some links to some of this, see my blog post Patents and Innovation, Mises Blog (Mar. 7, 2008) (noting economic historian Eric Schiff’s conclusion that when the Netherlands and Switzerland temporarily abolished their patent systems, they experienced increased innovation; Petra Moser’s finding that countries without patent systems innovate just as much, if not more, than those with patent systems).

nicholas gray August 7, 2008 at 10:32 pm

Re- the airplane. Every self-respecting Aussie knows that Lawrence Hargraves actually invented the airplane before the Wright Bros.! (I believe that New Zealand thinks some local Enzedder got there first.) Still, if they had taken out an international patent on the aeroplane, that means that some of the worst horrors of WW1 wouldn’t have happened! They could have ensured that only the French and British and Americans had planes in the war. We can be sure that the honourable Germans would not have broken the sacrosanct Patent Laws!
As for Switzerland and Holland doing without patents, have any of them had innovative inventors? Has there ever been a Swiss version of Thomas Edison? I ask because I think that if such a man were around and patent laws were repealed, he would leave for a country that had strong patent laws. (By innovative, I mean ground-breaking. The light-bulb was not just an improved candle.)

Haas August 8, 2008 at 2:02 am

Nick- how dare you :) the first person to fly was Richard Pearse! we just get ignored because we’re at the bottom of the world…

theblob August 8, 2008 at 3:26 am

In Thomas Edisons time many inventions were made parallel , and to reduce this boom to patent laws is… I think the utilitarian discussion comes down to “what is seen and what is not seen”.
The important part for me here is that their are million ideas out there, thinking up this things is not the hard part, the execution is. Not to mention the patents lying in someones desk, only to be used as legal weapons.

PS: Thomas Edison can’t hold a lightbulb to Nikola Tesla

Miklos Hollender August 8, 2008 at 4:22 am

“the inventor of a book or other contrivance of thought holds his property, as a god holds it, by right of creation”

Interesting – this is EXACTLY the Roman idea of auctoritas (the authority of the creator, the auctor, the initiator)

Ron August 8, 2008 at 9:34 am

It certainly makes sense to me that the absence of IP protection would result in an increase in competition. Rather than patenting an invention, then resting on one’s laurels while the monopoly profits roll in, the inventor would have to anticipate the duplication of his ideas and plan accordingly. As soon as (or possibly even before) his product is out the door he’ll have to be working on the next, improved version in order to retain his market share when all the copies of the original version hit the shelves.

I’m betting, too, that directly copied products would only be profitable for a short period of time following the repeal of IP laws. As inventors and producers become better at staying ahead of the copycats, the copycats themselves would have to offer not just a copied product, but a copy that includes some improvement or enhancement over the original. Though it’s possible that the lower price of the copy might make this point moot.

It’s also likely that a market for tools to prevent idea theft would evolve, providing a mechanism for inventors to protect themselves. Such things already exist, in the form of copy protection devices and encryption algorithms for digital media, for instance. Typically, these methods only serve to lengthen the amount of time before copying is possible, similar to the function of a patent, but without all the concomitant inefficiencies and bureaucratic arbitrariness.

newson August 8, 2008 at 10:43 am

it’s hard to imagine any move towards abolition of ip laws that doesn’t start with the us.
any lesser breakaway country would presumably be the object of punitive measures, as is alluded to in the historical example of the netherlands/switzerland, cited above by
kinsella/schiff.

Michael A. Clem August 8, 2008 at 11:01 am

Okay, so as a practical argument, we apparently can say that innovation would continue or even increase without patents. Tackling the assumption would go a long ways towards ending monopoly IP protection.

Ron August 8, 2008 at 11:26 am

MAC: “Tackling the assumption would go a long ways towards ending monopoly IP protection.”

Definitely. I think this is the default position taken by most IP proponents, with little thought given to the ethical implications thereof. It’d be a tough nut to crack, though.

Just kinda thinking out loud here…

Something else to think about in a non-IP market are the effects on the methods of research themselves. The newfound push to get products “out the door” may result in more efficient research methods. If patents are intended to allow sufficient time to recoup costs for R&D, then the absence of that protection will necessitate reduced up-front R&D costs. Same thing if a producer must assume that they’re going to have to compete with copycats almost immediately after their product hits the market…prices will need to be low enough to render copying less profitable.

I would think, though, that a brand new product might not have to worry about copying right off the bat. In order for copying to be profitable, demand for the product must be high enough to warrant it. Copycats may therefore wait to gauge consumer demand before adding to supply. If consumer demand is low enough, copying may not be profitable enough to be worthwhile. Would that then imply, though, that demand for the product itself isn’t high enough to be profitable, even without copycats?

Person August 8, 2008 at 11:52 am

It certainly makes sense to me that the absence of property protection would result in an increase in competition. Rather than constructing large captial equipment, then resting on one’s laurels while the capital rents[1] roll in, the inventor would have to anticipate the takeover of his factory and plan accordingly. As soon as (or possibly even before) his product is out the door he’ll have to be working on the next, improved version of the equipment to retain his market share when others are in control of his factory.

I’m betting, too, that output of stolen equipment would only be profitable for a short period of time following the repeal of property laws. As investors and producers become better at staying ahead of the invaders, the invaders themselves would have to offer not just a product of someone else’s equipment, but a product that includes some improvement or enhancement over the original machine’s output. Though it’s possible that the lower price of the stolen capital’s outputmight make this point moot.

It’s also likely that a market for tools to prevent invasion of factories would evolve, providing a mechanism for capitalists to protect themselves. Such things already exist, in the form of armed guards and fences for factories, for instance. Typically, these methods only serve to lengthen the amount of effortbefore successful invasionis possible, similar to the function of a property law, but without all the concomitant inefficiencies and bureaucratic arbitrariness.
[1] Sorry, this is the term for it.

Mad-libs for socialists. Nothing to see here, move along.

If IP is so unlike physical property, why are these reductios so easy?

Ron August 8, 2008 at 1:08 pm

Person,

Your reductio is “so easy” because it ignores a fundamental difference between physical property and ideas. Stealing physical property from its rightful owner prevents its owner’s use thereof. “Stealing” an idea from its creator does no such thing. The creator retains full use of his idea even though someone else is using it as well, ergo no violation of property rights has occurred.

Person August 8, 2008 at 5:11 pm

Ron: you were arguing about the EFFECT of removing IP, NOT whether violating it means a genuine violation of property rights.

Do you remember that?

So do you understand how my response dealt with the EFFECT of removing IP, not with the ethical issue of whether that violates property rights?

So do you kind of understand how responding to my refutation of the EFFECTS you claimed, by saying that removing IP doesn’t violate property rights, would kind of be non-responsive?

Yeah, let’s kind of rethink that one.

I need to set a limit on who I argue with about IP. Say, how long a chain of argumentation you must be capable of processing in order to argue with me.

If you really think the owner’s loss of the full factory is relevant, replace the situation in my example with a case of invaders taking over *half* the factory, such that both sides can produce the same product. We still have a nice, successful, productive, competitive market? No? Okay then.

Btw, all my points about how “then we can remove property rights because people can just put fences around their stuff” would be relevant either way.

???? August 8, 2008 at 7:39 pm

ummm what’s your solution Person?

andras August 8, 2008 at 7:47 pm

Lowell Sherris & Stephan Kinsella,
You both focus on your argument that state enforced patents are not necessary for innovation. I agree. I would even grant that you do not need the state for patents. Though neither of your examples were mass inventions. I admit it is hard to find eras without patents in capitalism.
Lowell I would argue of the Fleming/penicillin case: Fleming did not know the structure of penicillin so he could not patent it. What he knew was too broad. as he was a microbiologist. On the other hand, all the chemical research around penicillin is patented.
Do you want me to voluntarily give up my inventions? I see Atlas Trembling.
Stephan, it seems all the arguments focus around whether IP is property. The rest is just practicalities. However, You cannot just strip owners of their properties with a decree even if you think, may be rightly, that those are imaginary. You have to persuade them to do so or initiate a revolution. This is too far a jump to the dark to be sure of the consequences. It very much reminds me to social engineering.

John Howard August 8, 2008 at 8:15 pm

The premises of IP are:

a) learning is stealing
b) customers are property
c) mind-reading is possible

All three are false premises.

If you have an idea and wish to keep it to yourself, do so. But if you show it to me and I take the time to understand it and apply it, it becomes my idea, and the product of my effort is mine, not yours.

My customers have the freedom to choose my application of the idea over yours. You do not own customers and so cannot claim a loss.

You can not prove that I did not think the idea up myself, or was nearly done doing so, nor can you prove that you originated the idea. Mind-reading is a myth. All you can prove is that you got to the government patent office first and were rewarded with a coercive monopoly.

Ron August 8, 2008 at 8:39 pm

Person,

So what is your objection to people putting fences around their stuff? How, exactly, would doing so negate the need for property rights? Are you saying that individuals shouldn’t protect their own property? Do you mean to imply that such a function should be left purely to the state? Do you see a difference between protecting one’s own property and relying on the state to do so?

Oh…I think I get it. Perhaps you mean that if we can’t justify putting the state in charge of protecting our property, then we can’t justify protecting it ourselves? Interesting. Your non-response to my argument regarding the effects of IP repeal was meant to illustrate this point, no?

If not, then I can only assume your point is that the effects of allowing “idea theft” would be just as disastrous as allowing wanton theft of physical property. I thought you were smarter than that, but maybe I’m giving you too much credit. ;-)

Curt Howland August 8, 2008 at 9:09 pm

Person, yes. I am perfectly happy to have such innovation that has only a limited time to enjoy monopoly profits.

I can say this because I worked at a company that did just that. They made plastic. Not just any plastic, they made plastic to exacting customer specifications.

In the year that it took to reverse engineer, formulate, produce and deliver a replacement, this company made _serious_ profits. And during that year they were coming up with yet another customer’s perfect product, so there was substantial overlap.

Since strength, melting point, flow and all the other specifications are not “intellectual property”, anyone can produce whatever has the same properties.

If this plastics manufacturer is an example of the innovation that is possible in a non-IP environment, I can say with confidence that the world has nothing to worry about with a loss of copyright/patent.

Of course, Person, if history is any guide, you’ll just dismiss my real-world example as a pointless rhetorical exercise.

Ron August 8, 2008 at 9:22 pm

Y,know, Person, it occurs to me that perhaps I’m doing you a disservice by failing to respond to your non-response to my original non-response. So here I’ll respond, and I’ll try not to mix ethics with effects this time. ;-)

If Silas owns a factory, and Ron comes and steals the equipment from the factory or, as in your example, kicks Silas into the street and takes over the entire factory, the effect will be that Silas no longer has a factory. Silas can’t make stuff because Ron has all the equipment. Ron can make stuff, sure, but if Silas wants to make more stuff he must buy more equipment. So, Silas must expend more resources than he otherwise would have to continue to make stuff. Obviously, this is bad for Silas, so Silas would naturally like to prevent such theft from happening.

Silas, then, has two choices: he can protect his property himself, or he can rely on someone else to do so. Protecting his own property might mean building a fence, installing a security system, hiring a security guard, or some combination thereof…all of which require that he spend his own money. Relying on someone else to do so means utilizing the state, thereby getting everyone else to pay to protect his property. (Oops…sorry, I got really close to some ethics there. I’ll be more careful henceforth)

In any case, if Ron writes a piece of software, and Silas somehow gets a hold of a copy of the source code for it, a magical thing happens…or rather doesn’t happen, as Ron still mysteriously has possession of his copy of the source code. Ron is therefore able to make more copies of his software. Of course, Silas is able to make copies as well, but it doesn’t stop Ron from continue to use the child of his mind for whatever purpose he chooses.

Okay…pop quiz. What’s the same about the effects in these two scenarios? C’mon, I know you can do it…

Right! In both scenarios there are now two people producing the same thing. Assuming identical quality of output, they will each presumably obtain half the market share.

So, what’s different about the effects in both scenarios? Give up? Aww…I’m kinda disappointed, but not surprised.

The difference is that in the first scenario, a net loss has occurred because Silas had to expend more resources than he otherwise would have if Ron hadn’t stolen his equipment. In the second scenario there is no loss to Ron. See how that works? The cost to Ron when Silas “stole” his source code, is nil. Ron’s no worse off than he was before. Therefore, the effects illustrate the ethics.

See? I can be patronizing, too. ;-) Did it make my argument more convincing?

Haas August 9, 2008 at 9:51 am

ron loss can be potential profits too not just loss of what you have on hand

Curt Howland August 9, 2008 at 10:34 am

Person, you are ignoring the fact that Lamborghini, Rolls Royce and the like make good profits making small numbers of cars entirely on their reputation.

But since I’ve never seen anything you wouldn’t ignore when it suited you, I must wonder why I bother to continue to be surprised.

Ron August 9, 2008 at 11:37 am

Haas: “ron['s] loss can be potential profits too not just loss of what you have on hand”

This presumes that Ron can claim ownership of those profits to begin with. The problem with that is exactly as you said, they are potential profits, meaning they don’t yet exist. Can any producer rightfully claim ownership of anything that might result from his efforts, or only what actually has resulted from his efforts?

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