View source for Intellectual property

'''Intellectual property''' ('''IP''') is a broad concept that covers several types of legally recognized [[right]]s arising from some type of intellectual creativity, or that are otherwise related to [[idea]]s. IP rights are rights to intangible things—to ideas, as expressed (copyrights), or as embodied in a practical
implementation (patents).<ref name="Kinsella_IP">Stephan Kinsella. [[Against Intellectual Property]], page 9. Referenced 2011-09-07.</ref>

Intellectual property laws grant [[monopoly|monopolies]] to originators of ideas, giving them a legal [[right]] to [[initiate]] [[force]] (through the [[state]]) against anyone making use of the idea without the permission of the originator of that idea.

Modern [[libertarian]]s, such as [[Stephan Kinsella]] and [[Jeffrey Tucker]], consider the term to be self-contradictory, because ideas and patterns are not [[scarcity|scarce]] or [[rivalry|rivalrous]], so logically cannot be [[ownership|owned]].

==Types of intellectual property==

In today’s legal systems, IP typically includes at least '''[[copyright]]s''', '''[[trademark]]s''', '''[[patent]]s''', and '''[[trade secret]]s'''.<ref name="Kinsella_IP" />

Copyright consists of legal rights over literary, musical, dramatic, or artistic works, such as novels, music, and so on. A concept central to modern IP law is that of the "idea-expression dichotomy"; that a copyright holder has rights not over the ideas per se, but rather in his expression of those ideas. For example, a historian may write a book about the history of the Austrian school, based on a number of historical facts. Another author may use the same facts, but write his own book in his own, different words. There would be no copyright violation. The concept of the idea-expression dichotomy has been criticised by some anti-IP writers.
Although it depends on the medium, such copyright typically lasts for the life of the author plus a number of years- often as much as 70.

Patents are monopoly rights over the use and distribution of inventions. Unlike copyright, which is automatically granted (although some jurisdictions give additional legal rights to registered works), patents must be applied for and approved of. 

In a similar vein of thought, a commonly held belief is in a right to one's [[reputation]], and that speech can be restricted if it is [[libel]] or [[slander]].{{Fact}}

==History==

Patents emerged as a form of protection for [[mercantile]]s.  Copyrights are rooted in control and [[censorship]] of ideas.

==Effects and costs of IP==
{{See also|Costs of Intellectual property}}
IP rights, at least for patents and copyrights, may be considered rights in ideal objects. The ownership of an idea, or ideal object, effectively gives the IP owners a property right in every physical embodiment of that work or invention. Consider a copyrighted book. If A writes a novel, he has a copyright in this "work." If he sells a physical copy of the novel to B, in book form, then B owns only that one physical copy of the novel; B does not own the "novel" itself, and is not entitled to make a copy of the novel, even using his own paper and ink. Thus, even if B owns the material property of paper and printing press, he cannot use his own property to create another copy of A’s book. Only A has the right to copy the book (hence, "copyright").

Likewise, A’s ownership of a patent gives him the right to prevent a third party from using or practicing the patented invention, even if the third party only uses his own property. In this way, A’s ownership of ideal rights gives him some degree of control—ownership—over the tangible property of innumerable others. Patent and copyright invariably transfer partial ownership of tangible property from its natural owner to innovators, inventors, and artists.

Patents can be obtained only for "practical" applications of ideas, but not for more abstract or theoretical
ideas. This skews resources away from theoretical R&D. It is not clear that society is better off with relatively more practical invention and relatively less theoretical research and development. Additionally, many inventions are patented for defensive reasons, resulting in patent lawyers’ salaries and patent office fees. This large overhead would be unnecessary if there were no patents. In the absence of patent laws, for example, companies would not spend money obtaining or defending against ridiculous patents.<ref name="Kinsella_Effects">Stephan Kinsella. [[Against Intellectual Property]], page 14-15, 22. Referenced 2011-09-10.</ref>

In the US, authors have a copyright in their original works of authorship as soon as they write them, automatically, courtesy of federal law. No copyright notice is required. No copyright registration is required. The right is there, independently of the wishes of the author. There is also no clear and good way to dedicate a work to the [[public domain]].<ref name="Kinsella_sticky">Stephan Kinsella. [http://blog.mises.org/9240/copyright-is-very-sticky/ "Copyright is very sticky!"], ''Mises Institute'', January 14, 2009. Referenced 2011-09-17.</ref>

==Views==

Intellectual property is a regularly debated subject among libertarians. Most of the debate about IP concerns
patent and copyright. 

*Stephan Kinsella and Jeffrey Tucker are two of the most prominent strong opponents of all forms of intellectual property.
*[[Murray Rothbard]] was opposed to patents, but he believed that a weak form of copyrights could be enforced through [[contracts]].  
*[[Ludwig von Mises]] and [[F. A. Hayek]] were largely opposed to intellectual property.
*[[Ayn Rand]] was an enthusiastic supporter of intellectual property.

==Arguments in favor of intellectual property==

===Ethical and natural rights arguments===
Some libertarians advocated IP on moral or natural-rights grounds. According to this view, creations of the mind are entitled to protection just as tangible property is. Both are the product of one’s labor and one’s mind. Just as one has a right to the crops one plants, so one has a right to the ideas one generates and the art one
produces.

This theory depends on the notion that one owns one’s body and labor, and therefore, its fruits, including intellectual "creations." An individual creates a sonnet, a song, a sculpture, by employing his own labor and body. He is thus entitled to "own" these creations, because they result from other things he "owns."<ref name="Kinsella_Arguments_For">Stephan Kinsella. [[Against Intellectual Property]], page 16-18. Referenced 2011-09-10.</ref>

[[Ayn Rand]] argues that, since ideas must originate from the mental effort of an individual (or group of individuals), that originator holds the exclusive property rights to the product(s) of his labor.  While one cannot copyright ''theoretical'' knowledge - discoveries of facts or truths of reality not previously known - he can claim the right to an ''invention'', the ''practical application'' of that knowledge.  Since the object that is patented might not have existed without the inventor, and the object copyrighted would not have existed without the creator, the ideas behind such created objects are the property of their originators.<ref>“Patents and Copyrights,” ''Capitalism: The Unknown Ideal'', 130 - [http://aynrandlexicon.com/lexicon/patents_and_copyrights.html]</ref>

===Utilitarian arguments===
The utilitarian argument presupposes that we should choose laws and policies that maximize "[[wealth]]" or "[[utility]]." With respect to copyright and patent, the idea is that more artistic and inventive "[[innovation]]" corresponds with, or leads to, more wealth. [[Public good]]s and [[free-rider]] effects reduce the amount of such wealth below its optimal level, i.e., lower than the level we would achieve if there were adequate IP laws on the books. Thus, wealth is optimized, or at least increased, by granting copyright and patent monopolies that encourage authors and inventors to innovate and create.<ref name="Kinsella_Arguments_For" />

===Copyright by contract===
According to [[Murray Rothbard]], only activities which are not consonant with the free market would be outlawed by the market.  In terms of copyright, when a person writes a work and imprints "copyright" on it, he sells it ''on condition'' that the buyer not reproduce the work for sale.  By buying the copyrighted work, the buyer implicitly agrees to this condition and is contractually obligated to uphold it.  Patents that go beyond this restriction of the copyright contract to prevent people who ''independently'' arrive at the same invention from using and selling that invention are punishing an act that is not implicit theft, and hence would not be outlawed by the free market; thus, patents become a state grant of exclusive monopoly privilege, incompatible with the free market.  <ref>"Patents and Copyrights," ''Man, Economy, and State (with Power and Market)'', 745-754 - [http://mises.org/rothbard/mes/chap10e.asp#7._Patents_Copyrights]</ref>

==Arguments against intellectual property==

===Ethical and natural rights arguments===
Stephan Kinsella's seminal article, ''[[Against Intellectual Property]]'' outlines the modern libertarian case against all forms of intellectual property.<ref>[[Against Intellectual Property]], [[Stephan Kinsella]]</ref>  Kinsella's paper focuses on the [[ethics|unethical]] nature of intellectual property rights.  They are always in opposition to real material [[property rights]].  They are a straightforward government grant of [[monopoly]] to a favored producer.

Some libertarian proponents of IP argue that certain ideas deserve protection as property rights because they are created. [[Ayn Rand|Rand]] supported patents and copyrights as "the legal implementation of the base of all property rights: a man’s right to the product of his mind." For Rand, IP rights are, in a sense, the reward for productive work. It is only fair that a creator reap the benefits of others using his creation. For this reason, in part, she opposes perpetual patent and copyright—because future, unborn heirs of the original creator are not themselves responsible for the creation of their ancestors’ work.

One problem with the creation-based approach is that it almost invariably protects only certain types of creations. But the distinction between the protectable and the unprotectable is necessarily [[arbitrary]]. For example, philosophical or mathematical or scientific truths cannot be protected under current law on the grounds that commerce and social intercourse would grind to a halt were every new phrase, philosophical truth, and the like considered the exclusive property of its creator. For this reason, patents can be obtained only for so-called "practical applications" of ideas, but not for more abstract or theoretical ideas.

But the distinction between creation and discovery is not clearcut or rigorous. Nor is it clear why such a distinction, even if clear, is ethically relevant in defining property rights. No one creates ''matter''; they just manipulate and grapple with it according to physical laws. In this sense, no one really creates ''anything''. They merely rearrange matter into new arrangements and patterns.

It is arbitrary and unfair to reward more practical inventors and entertainment providers, such as the engineer and songwriter, and to leave more theoretical science and math researchers and philosophers unrewarded. The distinction is inherently vague, arbitrary, and unjust.

Moreover, adopting a limited term for IP rights, as opposed to a perpetual right, also requires arbitrary rules. For example, patents last for twenty years from the filing date, while copyrights last, in the case of individual authors, for seventy years past the author’s death. No one can seriously maintain that nineteen years for a patent is too short, and twenty-one years too long, any more than the current price for a gallon of milk can be objectively classified as too low or too high.<ref name="Kinsella_Arguments_Against">Stephan Kinsella. [[Against Intellectual Property]], page 23-25. Referenced 2011-09-10.</ref>

===Utilitarian===
[[Utilitarianism|Utilitarians]] hold that the "end" of encouraging more innovation and creativity justifies the seemingly immoral "means" of restricting the freedom of individuals to use their physical property as they see fit.

Kinsella points out three fundamental problems with justifying any right or law on strictly utilitarian grounds:

# First, let us suppose that [[wealth]] or [[utility]] could be maximized by adopting certain legal rules; the "size of the pie" is increased. Even then, this does not show that these rules are justified. For example, one could argue that net utility is enhanced by redistributing half of the wealth of society’s richest one percent to its poorest ten percent. But even if stealing some of A’s property and giving it to B increases B’s welfare "more" than it diminishes A’s (if such a comparison could, somehow, be made), this does not establish that the theft of A’s property is justified. Wealth maximization is not the goal of law; rather, the goal is [[justice]]—giving each man his due. Even if overall wealth is increased due to IP laws, it does not follow that this allegedly desirable result justifies the unethical violation of some individuals’ rights to use their own property as they see fit.
# In addition to ethical problems, utilitarianism is not coherent. It necessarily involves making illegitimate interpersonal utility comparisons, as when the "costs" of IP laws are subtracted from the "benefits" to determine whether such laws are a net benefit. But not all values have a market [[price]]; in fact, none of them do. [[Mises]] showed that even for goods that have a market price, the price does not serve as a ''measure'' of the good’s value.
# Finally, even if the other problems are set aside, it is not at all clear that IP laws lead to any change—either an increase or a decrease—in overall wealth. It is debatable whether copyrights and patents really are necessary to encourage the production of creative works and inventions, or that the incremental gains in innovation outweigh the immense costs of an IP system. Econometric studies do not conclusively show net gains in wealth. Perhaps there would even be more innovation if there were no patent laws; maybe more money for research and development (R&D) would be available if it were not being spent on patents and lawsuits. It is possible that companies would have an even greater incentive to innovate if they could not rely on a near twenty-year monopoly.<ref name="Kinsella_Arguments_For">Stephan Kinsella. [[Against Intellectual Property]], page 16-18. Referenced 2011-09-10.</ref>


Since advocates of intellectual property generally appeal to [[utilitarianism]] (that 'nothing will be created' if creators are not granted a monopoly over their creation), [[Michele Boldrin]] and [[David Levine]] have examined, in their book ''[[Against Intellectual Monopoly]]'',<ref>[[Against Intellectual Monopoly]], Michele Boldrin and David Levine</ref> the [[empirical]] evidence for this claim.  They find that, rather than stimulating creativity and innovation, intellectual property laws - especially patent laws - usually inhibit creativity and innovation.

===Copyright by contract===
Many opponents of IP rights support only [[contract]]ual arrangements to protect ideas and innovations — private contracts between property owners. But private contract cannot be used to recreate the same type of protection afforded by modern IP rights.

A contract binds ''only'' parties to the contract. Patent and copyright, by contrast, bind all third parties, regardless of their consent to a contract. Thus, if the book purchaser B relates to third parties T the plot of a purchased novel, these third parties T are not bound, in general, by the original contractual obligation between A and B.

Thus, the use of contract only goes so far. A book publisher may be able to contractually obligate his purchasers to not copy his book, but he cannot prevent third parties from publishing and selling it, unless some contract prohibits this action.<ref name="Kinsella_Copyright_Contract">Stephan Kinsella. [[Against Intellectual Property]], page 45-55. Referenced 2011-09-12.</ref>

===Argument from scarcity===
Libertarians believe in property rights in tangible goods. But why? As Kinsella notes, it is these goods’ ''[[scarcity]]'' — the fact that there can be ''conflict'' over these goods by multiple human actors. The very possibility of conflict over a resource renders it scarce, giving rise to the need for [[Ethics|ethical]] rules to govern its use. Thus, the fundamental social and ethical function of property rights is to prevent interpersonal conflict over scarce resources. To perform this function, property rights must be both visible and just.

As libertarians recognize, following [[John Locke|Locke]], it is only the first occupier or user of such property that can be its natural owner. Only the ''first-occupier'' [[homesteading]] rule provides an objective, ethical, and nonarbitrary allocation of ownership in scarce resources.

The problem with IP rights is that the ideal objects protected by IP rights are not scarce; and, further, that such property rights are not, and cannot be, allocated in accordance with the firstoccupier homesteading rule.

Ideas are not scarce. If I invent a technique for harvesting cotton, your harvesting cotton in this way would not take away the technique from me. Your use does not exclude my use; we could both use my technique to harvest cotton. There is no economic scarcity, and no possibility of conflict over the use of a scarce resource. Thus, there is no need for exclusivity. Similarly, if you copy a book I have written, I still have the original (tangible) book, and I also still "have" the pattern of words that constitute the book. Thus, authored works are not scarce in the same sense that a piece of land or a car are scarce. Even Rand acknowledged that "intellectual property cannot be consumed."

By recognizing a right in an ideal object, one ''creates'' scarcity where none existed before. Only tangible, scarce resources are the possible object of interpersonal conflict, so it is only for them that property rules are applicable. Thus, patents and copyrights are unjustifiable monopolies granted by government legislation. It is not surprising that, as [[Tom G. Palmer|Palmer]] notes, "[m]onopoly privilege and censorship lie at the historical root of patent and copyright."

IP rights change the ''status quo'' by redistributing property from individuals of one class (tangible-property owners) to individuals of another (authors and inventors). The IP law therefore [[trespass]]es against or "takes" the property of tangible property owners, by transferring partial ownership to authors and inventors. It is this invasion and redistribution of property that must be justified in order for IP rights to be valid.

The IP rule that innovators homestead partial control of all others’ tangible resources, is arbitrary and unjustifiable. It conflicts with the only justifiable homesteading rule, ''first occupation''. It doesn't establish fair, objective rules that avoid interpersonal conflict over scarce resources.<ref name="Kinsella_Scarcity">Stephan Kinsella. [[Against Intellectual Property]], page 28-36, 43-45. Referenced 2011-09-11.</ref>

===Enforceability and Innovation===
Technological innovation is often stimulated precisely when patents are not effective. This was the case with [[Eastman Kodak]], which adopted its well-known policy of permanent research and "continuous innovation" as a way to maintain its competitive leadership in view of the practical impossibility of enforcing all of its patents. Presumably, had they been able to enforce their patents, they might well have devoted fewer resources for research and development of new products, and technological development in this industry would have been less rapid.<ref name="Cole_Benefits">Julio H. Cole. [http://mises.org/journals/jls/15_4/15_4_3.pdf "Patents and Copyrights: Do the Benefits Exceed the Costs?"] (pdf) ''Journal of Libertarian Studies'', Volume 15, no. 4 (Fall 2001), pp. 79–105. Referenced 2011-09-17.</ref>

==Without Intellectual Property==
{{Main|Without Intellectual Property}}

How would the world look like without Intellectual Property? What are the current success stories and possible alternatives if some or all forms of IP were repealed (or became unenforceable)?

==References==
<references/>

==Links==
* [http://www.dklevine.com/general/intellectual/intellectual.htm Intellectual Property Page] resources compiled by Michele Boldrin and David K. Levine

* Writings
** {{md|3631|The Fallacy of Intellectual Property|Daniel Krawisz|August 2009}}
** {{md|5025|The Fight against Intellectual Property|[[Jacob H. Huebert]]|2010}}
** {{md|2632|Is Intellectual Property the Key to Success?|[[Jeffrey A. Tucker]]|July 2007}}

* Other media
** [http://www.stephankinsella.com/2010/06/pfs-speech-ideas-are-free/ "Ideas Are Free: The Case Against Intellectual Property"] lecture by [[Stephan Kinsella]], June 2010 <small>(transcribed as Mises Daily [http://www.mises.org/daily/4848 here])</small>

* {{wplink}}

[[Category:Intellectual property|*]]