I made a similar point in my article There’s No Such Thing as a Free Patent. In fact there is no evidence to substantiate the utilitarian claim that IP is necessary for innovation or that it even generates net innovation and creativity. There is no doubt that patent and copyright distort and skew the innovation and creativity that occurs–some types of creativity are suppressed, others are incentivized. Even if IP does generate net creativity and innovation (even if you ignore the skewing and distorting), there is no proof that it’s worth *other* costs of the patent and copyright systems. See http://blog.mises.org/10217/yet-another-study-finds-patents-do-not-encourage-innovation/. And there are unending cases of clear abuse, waste, or injustice: see http://blog.mises.org/11600/the-patent-copyright-trademark-and-trade-secret-horror-files/. The cost is immense and real: http://blog.mises.org/7223/what-are-the-costs-of-the-patent-system/.
There are principled, moral reasons to oppose patent and copyright: see my article The Case Against IP: A Concise Guide. For those who advocate a copyright system on utilitarian grounds, the onus is on them, and they have not satisfied it.
The law students are told that we have to find the right balance–the assumption is that we need *some* copyright law, even if the balance has gone “too far”. But this assumption itself is unjustified: there is no reason to think that ANY copyright law at all is justified. In fact, it is not and should be abolished.
“There is no doubt that patent and copyright distort and skew the innovation and creativity that occurs–some types of creativity are suppressed, others are incentivized.”
That way of putting it assumes your conclusion–that without IP law the outcome would be in some sense optimal. You need that assumption to get from “changes” to “distorts.”
The standard economic arguments for IP don’t tell us what the optimal level of protection is–it might be zero, it might be more than we have. But they do show why there is no a priori reason to think that zero is optimal.
I don’t think I’m assuming the non-IP world is “optimal.” Just that it is the baseline. IP advocates say that in a non-IP world there is a suboptimal amount of innovation, or something like this, and that adding IP improves matters. I’m saying the burden is on them: they need to show that net innovation is indeed the result, and that the value of the net innovation is greater than the cost of the IP system itself. They have not shown this.
I am pointing out that what we know for sure is that the IP system does cause more of some types of innovation, and less of others. This observation does not assume that the non-IP state is optimal. It only points out that we know some innovation (probably) goes up, some goes down. This is a distortion or skewing. I am not even criticizing the skewing, but pointing out that a distortion is not necessarily a net increate in innovative value–it might be neutral, it might be negative. So the fact of skewing does not help their case. If anything, it hurts it.
For further discussion of how patents distort the innovative process see n. 44 and accompanying text of my Against Intellectual Property. In particular, see Arnold Plant, The Economic Theory Concerning Patents for Inventions, sections 16, 19, 20, 24:
See also Rothbard, Man, Economy, and State, ch. 10, sec. 7:
David, you also wrote:
David, would you agree that those advancing this type of argument for IP have a burden of making not only this type of hypothetical argument, but that they have the burden of demonstrating that IP law does, in fact, increase overall innovation and creativity, and that the value of this additional creativity (minus lost creativity) is greater than the costs imposed by the IP system? Ideally they should give us some numbers in dollar terms–what is the type and value of marginal creativity stimulated by copyright; what is the type and value of creativity that is lost; what is the cost of copyright law? But at the very least some evidence that the net value is positive, and that it is significantly greater than the costs of the system. Do you agree?
Do you also agree that this has not yet been done? And don’t you agree that unless and until IP advocates produce this evidence, there is no good case for copyright? That it should be abolished if and unless the case for it is actually made?
Can anyone really think the Founders knew this for sure when they provided for copyright in the Constitution? Has anyone since then established this?
Machlup got it almost right in An Economic Review of the Patent System (a 1958 study cited in note 10 of my There’s No Such Thing as a Free Patent), which does not, as far as I’m aware, determine any “optimal” patent term, nor does he conclude that the patent system encourages innovation that is worth more than the cost of the system. In fact, Machlup says:
Where he is wrong, of course, is in assuming that even if we have no proof that the patent (or by extension copyright) system is “economically” justified, then we should not abolish it if we already have such a system. Of course, if we should not institute an IP system in an IP-free world, then if we have an IP system it should be abolished.
Wow, this is your first non-Von Mises celebrity comment. (That I know of).