Hey everyone, I’ve got a question for you:
What are the opinions of Austrian economists regarding illegally downloaded MP3s and the use of DRM (digital rights management)?
Clearly, illegally downloading a song is a bad thing – no Austrian would advocate stealing someone else’s property, correct?. What about the use of DRM to manage and restrict the use of mp3 files after they have been legally purchased? What is the “Austrian” solution to this problem?
Wgeary
There was a thread a while back that discussed the whole intellectual property issue.
To sum it up, nothing is ‘stolen’ and copyright is a government granted monopoly right that leads to rent seeking behavior.
Don’t think DRM came up but my personal opinion is its OK as long as it isn’t forced upon you by government decree. The companies who chose to protect their ‘property’ in this manner would have to compete with companies who don’t and chances are if given a choice consumers would prefer to not be locked into a particular vendor’s scheme and have to repurchase their favorite music everytime they bought the latest and greatest gadget.
Strictly speaking, there is no single ‘Austrian’ position on IP. Kinsella has written some rather influential articles on the matter, which I think most Austrians agree with though. I’m not sure if this is really a matter of economics, unless there are economic works on IP by Austrians that I am unaware of.
Before we answer this question, best to absorb Dr. Rothbard’s views on the subject.
http://www.ccsindia.org/ccsindia/lacs/7patents_copyrights.pdf
He had a very reasonable view of the subject. Copyright would be made by the author or artist himself, on the work, not by the state.
As an Austrian, I could not support the downloading of such material, as Rothbard held it to be implicit theft. Austrians have no view as to the propriety of DRM or any other scheme. It is totally up to private individuals how they choose to protect data, and the government thus has no role.
Copyright law would properly be pursued as common law, in common law courts, with remedies essentially being limited to cease and desist. In practicality, however, the genie is out of the bottle permanently, you are not going to stop the spread of copyright material.
The state should not be in the business of enforcing copyright, true common law courts NOT being part of the state.
No, clearly illegally downloading a song is a GOOD thing. It erases artificial scarcity.
Claims of copyright “steal”, infringe, and trespass on the real property rights of others. If you declare a copyright or a patent on doors or windows, you use violence to prevent other people from creating doors and windows out of material from and on their own property without extortion payment or express tyranical permission. Copyright thus causes a net poorer world to exist than would otherwise be the case, just exactly as violent socialism restricting free trade causes a net poorer world to exist.
Copying is legitimate peaceful natural economic action behavior. All information whatsoever, including prices, is COPIED.
There is nobody that is not copying the ideas of somebody else in their actions, in their scientific work, or in their artistic work. Every person is dramatically increasing their personal subjective wealth precisely because of copying. All education involves STUDYING by the precise means of copying. Violent enforcement depends upon wholly arbitrary boundaries, by necessity bundles public domain ideas such as language into claimed copyrighted works, and is enforced for an arbitary period of time.
“Intellectual Property” is nothing more than a government monopoly grant on distribution. It hinders the progress of scientific and artistic advancement. It causes scarcity to exist where there would otherwise be no limits to abundance. Massive amounts of wholly wasteful non-productive action and resources are squandered employing legions of parasitic lawyers, judges, and unsavory characters in court cases.
The arguments for and against “imaginary property” are mostly economic in nature. The pro “imaginary property” arguments are full of economic fallacies. The main pro “imaginary property” argument, that incentives to produce, research, and develop “imaginary property” would not otherwise exist are obliterated by merely looking at the billions and ever growing posts made on internet message boards in spite of the fact no monetary remuneration is usually forthcoming. People still talk and share ideas even though nobody is paying them to talk and share ideas. Everything which requires research and development costs can be voluntarily financed up front in the free market by specific individuals seeking the fruits of those efforts. Even the greatest scientists and artists ever have profited more from copying the ideas of others than the value they themselves have personally contributed. Assuming artistic and scientific ideas have economic value, all receive more in return than they themselves produce. It’s as simple as observing there are far more posts on the internet to read than you yourself write.
The use of DRM is fine. The use of anti-DRM is also fine. Nobody has the right to force others to be deaf, dumb, and blind to the information signals which are being sent through public domain airwaves.
The “Austrian” solution is a complete repeal of all copyrights and patents.
I would have to respectfully disagree, particularly on your last sentence of your post. As we well know, the Austrian community is deeply divided on the subject of copyrights. Just peruse the hundreds upon hundreds of posts made to the Mises blog on the subject of copyright. No other subject even comes close to the controversy that copyright has in the Austrian community. While Austrians for the most part oppose patent, on copyright they go either way.
Let’s have a fun experiment. Lets copy Human Action, word for word. 
Now, lets blot out the name of Ludwig von Mises and write in your own name. Now, lets print and distribute copies to stores and see the fun begin. This will be the proof positive of whether certain Austrians REALLY oppose copyright.
First off, banning copyright would be violating contractual freedom. If the producer told you that you cannot copy it if you consume it, then they have the right to enforce it.
Second, it would raise the prices for the law-abiding consumers.
It would restrict innovation. The free market is the key to innovation.
Unless those Austrians are working on the assumption that information is property, they’re arguing for protectionism, which is rather un-Austrian. Property rights are not time-limited monopoly privileges though, property rights are perpetual, so if they’re arguing that information is property then they’re not arguing for copyrights but rather for something very different. If information is property, then by right I can demand that you forget everything I’ve just written; that my information is in your brain in no way lessens my rights over it, just as my inviting you into my home doesn’t lessen my right to demand that you leave. Fair use is incompatible with information as property.
Ever heard of fraud? All copyright law does in this case is shift the claim for restitution away from the actually injured parties and towards the copyright holder.
As for the OP, you shared your own opinion on downloading so I’ll do the same. I have every right to do whatever I want with whatever information I may come across. If I didn’t sign a non-disclosure agreement, no one has any right to demand restitution from me for my use of such information, as I’ve done nothing wrong. If I did sign a non-disclosure agreement, no one has any right to anything but the established penalty bond set within the NDA. If there’s no penalty bond, it isn’t a real contract, so the other party can go pound sand.
I have to disagree with this.
Scenario 1: Someone walks into a music store and steals an album. Is this, in your opinion, a good or legal thing? I would hope not.
Scenario 2: Someone goes to a website and illegally downloads an album. How is this scenario any different than the first?
Another question for you: What if you were to walk into a music store with a laptop. You go to the back of the store, put a CD into the laptop, rip all of its songs onto your computer and walk out. Is this a good thing?
You are depriving them of a physical asset.
You are depriving them of a sale…talking about the store here.
You are also depriving them of a sale. Not the ability to sell the CD to another person but the actual sale you didn’t make due to copying the CD onto your laptop.
So according to this logic any sale not to this particular store is ‘theft’. Say that iTunes had the same album for a lesser price any sale by them would be depriving this store of a sale and would be essentially stealing money out of their till.
But if you want to talk about the ‘theft’ involved by violating the monopoly rights of the copyright owner then it’s a whole different story…
If physical goods could be duplicated as easily as ideas, prohibiting that would be violently sentencing and forcing others into poverty. What more do you really need to say?
Another entertaining sidenote: “Piracy”? Pirates never copied any information. If I download an album I’d like to be known as something else. Maybe “Historian-Preserver of Aesthetics.”