Economics vs. Morality

I came across this Usenet post by David Friedman a while back discussing some of the practical ramifications of technological innovation in relation to what may soon be unenforcable IP rights. Here are a few points he mentions:

    1. I don't think anyone is entitled to earn a living doing what he likes to do--after all, you might like to do something that nobody else values having done.

    2. There is still a role for publishers, or something similar, as filters--ways in which people can find works they want to read/listen to/etc.

    3. There are a variety of indirect ways in which producers of intellectual property can earn an income, even in a world in which copyright law is no longer enforceable. One simple example is the band that gives away MP3's of its music but sells concert tickets.

    4. It isn't just the reproduction cost that is creating the problem. It is the combination of low reproduction cost--which has been true of software more or less form the beginning--with networks that make it easy to find what you want in a decentralized way. Centralized distribution systems, even with low reproduction cost, are easier to enforce copyright law against.

    5. Some forms of IP will still be protectable. Consider a product--say a computer program--which is divided in two parts. The big part I give away. The small part sits on my server. You need both parts to use the program--and I rent access to my server.

    For a real world example of some importance, with the size of the parts reversed, consider Lexis and Westlaw.

    Incidentally, I discuss some of these issues (and much else) in a book draft currently sitting on my web page for comments.

One of the advantages of looking at IP from an economic perspective rather than a moral one is that it takes into account the practicalities of the real world. Even if you believe that artists and other creators have a moral claim to IP rights, the widespread availability of software that makes reproduction and distribution easy, cheap, and decentralized means that enforcement of IP claims becomes nearly impossible.

I think I understand why some people feel so strongly about this issue and wish to deny the impossibility of enforcing IP rights in a digital age. These people tend to make their living from writing software or music, and are worried that their current method of employment will not be viable in a world of unprotected copyrights. But as Friedman suggests, this is not necessarily true for software publishers, musicians, or authors.

The area with the biggest problems with weakened IP rights is not art or software, but drug research. However, barring major changes in chemical engineering, it still requires a lot of money, equipment, and employees to reverse engineer drugs and produce generic brands. That makes enforcement of IP rights for drug manufacturers much more realistic than for art or software.

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