I am not concerned.
If you say so.
It will be convenient to use your example to show you what I am talking about.
Let X be the cost of deciding what to print, including the author deciding what marks to put on the page and the publisher deciding which author to publish. Let Y be the cost of printing it, including the paper and all of the other materials.
1. Cost to the first publisher = X + Y
2. Cost to the second publisher = (less than X) + Y
Let F be the cost of deciding where to sell, including trying to find gaps in demand and other things. Let V be the cost of selling it, including getting the oil, transporting it, and the other things.
1. Cost for the first oil company = F + V
2. Cost for the second company = (less than F) + V
Where did the “fixed” and “variable” thing come from? From the beginning, I was talking about how it costs money to research where to sell, where gaps in demand are:
Let me simplify my argument for clarity. Authors and oil companies both have costs associated with deciding which market to enter. Both could wait for competitors to choose markets first and then try to imitate those competitors. If they do so, they forgo the profits associated with being a first mover into a market. That is the reward for the risk of investing in research.
However, things change after a decision to enter a market has been made. In the author’s case, a good is produced that can be easily reproduced at a fraction of the cost, not including any research costs. In the oil company’s case, a good is produced that cannot be reproduced at any cost. Any company choosing to produce the good must bear the full cost of producing that good, regardless of when the good was produced in relation to when the company entered the market.
All those assumptions being true, the equations I presented earlier are correct. If we must include research, let R be research. Let all other variables be as I described my prior post in this thread:
First publisher’s cost = R + X + Y
Second publisher’s cost = Y (they do not pay any portion of X since all of X has already been done by another company)
First oil producer’s cost = R + F + V
Second oil producer’s cost = F + V
So the first publisher/producer both pay R, but they are rewarded with first mover profits if their research was correct. Once research is complete, the good must be produced/supplied. In the case of the publisher, only one has to pay the writing, editing, and design costs. If this is not true, please address it, since I’ve had to state it several times. In the case of the oil companies, they both must account for the full cost of each unit produced, including all fixed and variable costs. It doesn’t matter when they acquire the oil, the cost is accounted for when it is sold (Accounting 101).
Yet you neglected to even mention that in your example. Why?
I’ve answered this, but I’ll repeat it. The reward is first mover profits.
Unfortunately for authors, without copyright protections their good can easily be reproduced without the copier bearing any of the writing, editing, or design costs. All of these costs take place after research is done, yet the second publisher gets to avoid those costs along with the research costs.
Fortunately for oil companies, competitors that enter the market still have to bear the full costs of the goods they sell. After research costs are taken out, new competitors do not gain any other cost advantages. This is different from people copying books. Again, please refute this if it isn’t true.
I am not contesting that. I am just saying that such “risk[s]” exist in all parts of the market to the extent that, if you support ‘IP’ laws, you should also support a myriad of other monopolies.
Please list these monopolies that I should also support according to your logic. Also, a copyright isn’t much of a monopoly since substitute goods can be created. You might think author A’s economics book is too expensive, but other authors can produce cheaper economics books. One of the main defining points of a monopoly is that no reasonable substitutes are available; otherwise, how could they become a monopoly?
When did I contest any of that? Also, you ignored my other example.
What? I stated that copyright law was needed. You asked why people couldn’t use contracts instead. I explained how I thought it would be nearly impossible. Now you state that you never thought it was possible.
If that’s the case, what was the point of your question? Also, what other example?
On a separate note, I’d like to address your idea of research. You say that the first firm is the only one that pays research costs. How does the second firm ever discover the first firm’s profits if they don’t invest in research?