Home > Uncategorized > Guns, Germs & IP; Or, Is good information not hard to find or socially advantageous to protect? A few thoughts to Stephan

Guns, Germs & IP; Or, Is good information not hard to find or socially advantageous to protect? A few thoughts to Stephan

I’ve been travelling, so I hope readers will forgive a few late comments on Stephan Kinsella’s well-read July 28 Mises Daily post, “The Death Throes of Pro-IP Libertarianism“. I copy below the comments I left on the post comment thread:

TokyoTom August 17, 2010 at 8:23 am

Stephan:

While I agree with the conclusion that state-created and -enforced IP is no longer justifiable and should be jettisoned, I disagree that IP differs IN PRINCIPLE from other forms of “property” that societies have evolved and/or deliberately developed institutions to protect. The case against IP is not an absolute one, and you both stretch too far and show too little sensitivity to those who have simply accepted IP as a given part of our legal and moral framework.

I have noted before in greater detail a number of these points, in comments I have copied here: http://mises.org/Community/blogs/tokyotom/search.aspx?q=IP

Let me make a few new specific points here:

1. “By treating these dissimilar things — nonscarce, infinitely reproducible patterns of information and physical, scarce objects — similarly, the IP advocates try to treat them with the same rules. They take property rules designed precisely to allocate ownership of scarce physical objects in the face of possible conflict and try to apply them to information patterns. In so doing, they end up imposing artificial scarcity on that which was previously nonscarce and infinitely reproducible.”

Advances in technology greatly aid your argument about nonscarcity and reproducibility over just a few years ago, but not only does this seem historically incorrect, but given scarcity of humans and material objects, information still retains many elements of scarcity. It takes scarce resources to develop, refine, transmit, and acquire useful information, and individuals, groups, firm and societies all invested also in methods and rules to protect such information (for various reasons, such as to ensure recovery or investment, maintain advantages over rivals etc). Formal IP has at least some of its roots in a group decision that the society as a whole would be advantaged if solely private protection of valuable information was relaxed in exchange for public disclosure and limited state protection. Such a decision would in part be motivated by a calculus that treating information as “property” deserving of protection by the state would enhance overall welfare by lowering overall costs of purely private effort to defend such information (the same motivation for formal protection of other “property”; even as “[email protected]” may veryt well be a theft from the commons or public purse).

2. “Technological and other progress is possible because we can learn and build on previous knowledge. The market itself crucially relies on emulation — entrepreneurs emulate the successful action of others, thereby competing and serving consumers, and always bidding down prices and even profits.”

That emulation improves products and welfare is surely correct, and technological progress certainly makes emulation even cheaper. But individuals and groups are less likely to invest in developing information if competitors can freely and easily copy it. If we eliminate IP, we will certainly NOT eliminate the value of information or the incentives that drive people to invest in and protect it – or to engage in spying/other efforts to “steal” information that is privately protected.

3. “The market also enables the production of products that are scarce goods — with ever-increasing efficiency — and, crucially, makes scarce goods more abundant. The market is always trying to overcome and reduce the scarcity that is inherent in physical resources. The human actors on the market use infinitely reproducible, nonscarce knowledge and information to guide their use of scarce resources in ever-more efficient ways, so as to reduce the real scarcity that does exist in the physical world of useful goods.”

The first part of the second sentence is surely wrong in many important cases: in a competitive world, human actors/firms/societies try to gain advantage over competitors in satisfying customers by using difficult to reproduce and/or secret, scarce knowledge and information to guide their use of scarce resources in ever-more efficient ways, Information is valuable; this will not change if IP is eliminated.

4. “It is obscene to undermine the glorious operation of the market in producing wealth and abundance by imposing artificial scarcity on human knowledge and learning”

Over the top and ignores the real incentives and motivations of economic actors. While much human progress comes from emulation, much has also come from the investment by various actors in developing and applying SCARCE knowledge under conditions in which such information was not known and/or could not be reproduced or as efficiently utilized by competitors. This is simply a fact, and hardly an obscene one. It is also a phenomenon that will not change if formal IP is eliminated.

Regards,

Tom

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  1. TokyoTom
    August 25th, 2010 at 06:11 | #1

    Dumky:

    I’m aware that libertarians try to make principled, ethical arguments against government and IP; I support those efforts. However, given that most people are NOT libertarians, utilitarian/cost-benefit arguments are also needed.

    Governments and IP are not simply the result of beliefs and biases; we obviously have them today simply because we had them yesterday, and we had them yesterday because people worked to created them (and to change and make use of them).

    I think that a history of IP could tell us something useful, but without the history we know that much IP today is quite abusive.

    As now, in the past some knowledge was quite valuable, so pre-IP we saw many informal and formal methods used to limit the scope of people who knew or could acquire or disclose such knowledge.

  2. TokyoTom
    August 20th, 2010 at 15:28 | #2

    Dumky, sorry; I’m short for time.

    My main approach to Stephan is that in a purely libertarian society, IP protection of some agreed sort remains conceivable.

  3. Dumky
    August 19th, 2010 at 15:47 | #3

    Hi Tom,

    I know you’re anti-IP, I’m just trying to understand why and why your argument different from Kinsella, and which arguments are stronger. I’m trying to get to the bottom of it, in a friendly way.

    Regarding government in general, I would say that economists can assert that government (due to its involuntary nature) yields a net loss compared to the alternative. Libertarians, it seems to me, don’t make that case as much as saying unprovoked coercion is illegitimate.

    So I’m not sure that arguments for or against IP and government really compare to each other.

    Like you, I wonder how we ended up in the situation we’re in today, both for IP and for government. Are government and IP a result of beliefs and biases? Maybe the problem is simply the lack of clear theory about government, although I think philosophers and classical economists had figured it out rather well a few centuries ago 😉

    Maybe this calls for a historian’s work, to look back at the first IP laws, and their subsequent escalation. My concern is that the history of the laws won’t tell us much, because laws seem rather de-coupled from what people really want (call me jaded ;-). It’s easy to say yes to a law, when the costs are very indirect and you don’t have to make any direct trade-off yourself.

  4. TokyoTom
    August 19th, 2010 at 03:06 | #4

    Dumky, it seems that you, like Stephan, want to turn me into a pro-IP advocate. I'm not an advocate for government intervention here; I'm just trying to understand in part how we ended up with IP in the first place, and criticizing some of the anti-IP positions.

    My point about guarding is that people tend to treat valuable information in the same way that they treat tangible property: they pay to protect it, and they pay to acquire it. I don't see a sharp principled distinction between information and tangible property, and I think this undermines the anti-IP case presented by Stephan. I still agree with his net position, but on same basis that libertarians try to persuade others about the state generally – that its costs far exceed its benefits, and that defense of property generally should be left to individuals and associations.

  5. Dumky
    August 18th, 2010 at 23:53 | #5

    “My basis position is that “property” is a fluid social construct; the “principles” we use to reinforce it is a process of conscious and subconscious rationalization.”

    I lean that way too. I’m still trying to understand the “natural rights” approach.
    I kinda like the argumentation ethics argument (it’s elegant). There may be an analogous line of reasoning, where my arguing with you implies that I accept that you replicate patterns that I share with you or that I do not explicitly protect from you.

    “That people still want to guard information undercuts the anti-IP arguments, but I agree that it does not justify state protection.”

    That seems wrong to me. People want to guard their business, and they would prevent competition if they could. That does not seem a valid pro-IP argument. Also, it is not compatible with the quest for universal ethics.

    It is true that knowledge is valuable. But my shoe store is valuable too. The fact that you open a competing shoe store “harms” me, but not in a way that I could justify aggression against you.

    It seems that you are willing to accept government intervention based on utilitarian arguments (cost/benefit). The whole problem with that is it requires interpersonal utility comparison, doesn’t it?

  6. TokyoTom
    August 18th, 2010 at 23:24 | #6

    Oops; as for “scarce”, this is a comparative term. Even easily reproduced information, requires an investment of valuable time to acquire. In any case, people and groups protect information only because they perceive that it’s not already out of the bag; i.e., because THEY regard it as scarce.

  7. TokyoTom
    August 18th, 2010 at 23:19 | #7

    Dumky, thanks for your comments.

    My basis position is that “property” is a fluid social construct; the “principles” we use to reinforce it is a process of conscious and subconscious rationalization.

    In an age of cheap replication of information, duplicating may take away little from the other person, but even today as in days of yore it may disadvantage them by eliminating a competitive advantage.

    The Greeks understood this instinctively when they had Zeus chain Prometheus for stealing fire and giving it to man.

    That people still want to guard information undercuts the anti-IP arguments, but I agree that it does not justify state protection.

    On “group decision” I suggest you look further at my older posts that I link at top, but I am suggesting that for parts of IP there was an explicit quid pro quo: we’ll protect your position if you disclose your knowledge, so that society may benefit. This is an explanation, NOT a defense for IT.

    Squabbles about “rivalrous” ignore that it is human beings and groups themselves that are rivarlous, and that knowledge can provide real and important advantage. This is why individuals and groups – and then governments – have strove to protect knowledge.

    Human societies protect all resources where the benefits of doing so out outweigh the costs. There is a very wide and continually shifting spectrum here. My view is simply that the costs of govt IP now greatly outweigh the benefits.

  8. Dumky
    August 18th, 2010 at 17:43 | #8

    Hi Tom,

    Thanks for the thoughtful points.

    Regarding the first one (that IP is not property because of principle but rather technological advancement), I’d have to disagree.
    Whether it takes a little or much effort (and my own private resources) to duplicate a pattern does not change that duplicating it does not take it away from the other person. That was true before technological advancements.
    That said, technological advancement is relevant in that it makes the matter more obvious to the crowds, to intuitively grasp the problem.
    Also, it is worth considering that still today some ideas and patterns can still be protected by their inventors by making it more expensive to copy, by using non-IP means (technical obfuscation, NDAs, …).

    “Formal IP has at least some of its roots in a group decision…”

    Are you saying that the IP laws are legitimate because of the democratic process, or maybe the constitution? What “group decision” are you referring to?

    Regarding your final point and “SCARCE knowledge”, given the non-rivalrous nature of knowledge (my “taking” it does not literally “take” it from you), I’m not sure it qualifies as scarce.

    To be honest, I’m a bit confused on the terminology issue, as the dictionary defines scarce as “being in insufficient supply”, but Kinsella seems to use it as “being in insufficient supply AND rivalrous”. I prefer to use “rivalrous” directly for more clarity.

    To me, the lack of rivalry means that ideas and patterns are not conflict-generating in the sense that deserves monopoly control (ie. private ownership). An intuitive indication of this fact is that any IP laws are arbitrary (duration, fair use exceptions, …), unlike real property.

  9. TokyoTom
    August 18th, 2010 at 02:32 | #9

    Stephan, I am NOT an IP advocate (technological advance and abuse fatally undermine any case), but it seems we still have a beef: your arguments misunderstand property and are shallow (show me principles, and I’ll show you a dog growing over a bone), misunderstand scarcity and the role of scarce information in competitive advantage and progress and (along with IP advocates) misunderstand the factors (especially avoidance of private cost of protection) that drove the development of IP.

    Further, your case is not at all geared towards non-libertarians: the business/investor community globally is pushing ahead to strengthen IP, and domestic industry is unlikely to agree to abandon any defenses they may have against industrial spying, particularly by China.

  10. nskinsella
    August 18th, 2010 at 00:44 | #10

    Tom, eithery ou are or are not an IP advocate. If not, we have no beef. If you are, then my comments apply. As for focusing on your comments–I’ve focused on what I think worth replying to.

  11. TokyoTom
    August 17th, 2010 at 15:03 | #11

    Stephan, thanks for your quick comments.

    Hoever, are you suggesting I'm an "IP advocate"? On what basis? I've taken no such advocacy position in my comments. Stop creating bogey-men and focus on my comments.

    I see plenty of role for entreprenuerial creativity in dealing with a non-IP world; there's already plenty of it (as stealing/spying is unrelenting).

    WHo's to say how much less innovation we'll see if it is easily swiped and duplicated? Dunno, but it seems axiomatic that there'd be less than if such info and related returns could be inexpensively protected.

    Who's arguing for state intervention? I'm just suggesting that your blanket dismissal glosses over some important issues you might want to fill in to be more persuasive.

  12. nskinsella
    August 17th, 2010 at 14:05 | #12

    “That emulation improves products and welfare is surely correct, and technological progress certainly makes emulation even cheaper. But individuals and groups are less likely to invest in developing information if competitors can freely and easily copy it. ”

    IP advocates seem to have no imagination. They don’t see any role for entreprenuerial creativity when dealing with a mixed world of non-scarce AND scarce things. You are basically the same as the mainstreamers who believe in “market failure” and that we need state intervention to fix these market failures.

    How do you know there will be “less” incentive to innovate, or less innovation? And so what, anyway? Are we all consequentialist-utilitarians now? Is libertarianism about individual liberty and freedom and the sanctity of property rights–or is it about setting a monopoly force government to impose coercive rules designed to “make it more likely for people to invest in developing information”?? The “libertarian” IP advocates seem to have no principles, no mooring. It’s all just ad hoc policy wonkism.

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