Wouldn't IP be legal in an anarcho-capitalist society?

Economics Political Theory
21

The anti-IP position does not imply that a person cannot sell original copies of his own work. It only means that, once released into “the aether”, you can’t prohibit people from copying it in whole or in part or from altering it or even misattributing it. These are all bad form, but there is a difference between actions that are bad form and actions that are unlawful.

Or get a “Friends of the Library” membership at your local uni, they should have a subscription to all those journals (which is exactly why the journals are so ridiculously over-priced). Once you download the PDF, just save it to a thumb drive and voila, you are the proud owner of a journal article for the price of a $20/yr. library membership.

Precisely.

Isn’t it unfair that James Clerk Maxwell - responsible for synthesizing almost the entirety of the theory of electromagnetism - devoted his life to the study of the physics of electromagnetism and yet he and his descendants receive no compensation even close to the value of his work?? Or how about Alan Turing who devoted his life to formal mathematics and utilized his talents to help break the German engima cipher and perform other cipher work during World War II only to be double-crossed and either murdered or driven to suicide by one of the very Allied powers who he helped during the war? By the way, Alan Turing could be called the inventor of the computer. No biggie.

The point is that we all ride on each other’s backs and most of the positive benefits of others are never repaid and could not be repaid even if we tried.

I strongly recommend you read the book Against Intellectual Monopoly.

I don’t know. By your reasoning, broadcast television is impossible. The fact is, this is what entrepreneurs are for. When there is a large, unmet demand, it is entrepreneurs who set about trying business models until something works. Once someone gets it right, others copy that and improve on it further. IP stifles innovation in every market where it exists for precisely the same reason you’ve noted that prohibitive pricing of medical journals stifles medical advancement. Nobody gets smarter by virtue of not sharing information.

I think that IP is so popular even with people who are hurt by it (most people) more than they are helped by it because people are egotistical and vastly overestimate their own originality. Nobody is very original. Almost all originality exists outside of you, you are a tiny drop in the ocean of original ideas. The reality is that almost every idea you’ve ever had is copying off someone else in a million tiny ways you could never even be conscious of. If you’re lucky, you might just strike on that one idea that happened to be the answer to 1000 questions (consider William Shockley and the invention of the semiconductor as a case study in stumbling on the right idea at the right time and also as a case study in the dark side of IP). How many great inventions sit unused for 17 years while the market waits for the greedy inventor to lose his power to demand monopolistic royalty arrangements and licensing fees? Once the patent expires, not only does the price drop but the market is flooded with variations on the original invention… rarely does the original invention survive the market test… it almost always needed a few tweaks to fit consumer demand. In the meantime, the original inventor had grown fat and lazy with his patent and was no longer capable of market competition. See James Watt and the steam engine.

Clayton -

22

IP rights on drugs is trying to solve a problem created by government intervention. The FDA requires a massive amount of money be dropped into clinical trials before a drug can be approved and allowed to reach the market. In a free market clinical testing can be a profitable endeavor. Find people with the disease you are looking to cure and tell them you have a new untested drug out that they can pay to get early access to. You would need to charge twice the cost of production for this since you will need to pay for your control group but this can make clinical trials easily break even, if not profitable. If clinical trials can be profitable then there is incentive to try out new drugs for rare diseases.

Chances are generic companies aren’t going to be interested in copying your untested drug so you won’t see them trying to compete until your trials have proven successful. If you charge enough for clinical trials you can recoup your R&D costs before entering your drug into the open market (where it will be copied) but at that point you are in the same boat as the generics having broke even in R&D/testing you can now market your drug to the masses in a competative way.

23

Sure IP can be legitimate in an ancap society but the IP owners will need to innovate on their product’s medium since enforcement of the contracts (like in your example) in most cases won’t be worthwhile, e.g I sell a book that I hope to earn 100 oz of Au with, it gets copied and the sharing goes viral from my first sale, lawyers tell me they can recover 1,000 oz Au in damages if I first pay them 10,000 oz Au.

Today ACME, Inc. sells IP products that are instantly replicable and transferrable while ACME, Inc. relies on the gunverment’s power to protect their goods from being copied and shared.

Tomorrow, perhaps in a world without gunverment, ACME, Inc., now being forced to evolve and innovate, sells IP products on a pay per experience propeitary device which allows no means of copying the source at the quality first delivered?

24

A problem with IP is that while yes, you can create a contracte between you and the buyer/leaser of your product, no one else is necessarily held liable. This means if say a buyer loses the book and someone else finds it they aren’t bound by the contract and are free to copy the book. Or if the book is stolen, the thief can be tried for theft but not copyright infrigement if you decided to make and sell 100 copies of the book.

What this basically comes down to is that IP is impossible to secure and therefore it is meaningless to consider it. Even in situations where everyone ‘obeys the law’ contract law regarding IP can still easily be circumvented (as in the lost book example above).

Personally, I think if something can be copied by someone they should be allowed to. I think there is more merit in trademarking, but even this seems unrealistic to stop and therefor not worthy of ‘laws’.

25

As a side note, this is not possible since anything a human can perceive with their senses (sight, sound, etc.) can be replicated at 100% quality (as far as the human perceives it). All you can do is increase the barrier to entry to copying but you cannot stop copying unless you don’t allow a human to perceive the information, in which case you have no product in the first place.

Software as a service works because there is information that no human can see, but software as a service doesn’t work for books, movies, music, etc.

26

This is pretty funny, because his book is free, and he has numerous talks and lectures for free. Instead of watching those in order to understand his position, you request something which is not free (and doesn’t invalidate his position), and when denied the ability to free ride, which is wholly consistent with his theories, you claim he has violated some principle.

Take in everything Stephan has written on IP and libertarianism in the last 2 years, and you won’t need to take his course.

This is an argument against contract, not about IP.

Stephan has addressed this numerous times. Publicly.

As far as what is fair, no one is entitled to a profit.

27

I don’t believe you could get very many people to pay for a drug that you can’t say it will help and you can’t say it won’t kill you because it hasn’t been tested yet. Also, the amount they would have to pay to cover development and testing costs would be prohibitive. The other important factor that applies to both testing and subsequent general use is the issue of liability. No drug is without side-effects, and there isn’t a new drug these days that soon after becoming available to the public, lawyers are filing class-action suits against pharmaceutical companies, often costing these companies hundreds of millions of dollars.

How do you proceed to develop a new drug without providing for potential legal expenses as well as the cost of development and testing? Nobody would pay enough for testing to recoup the cost reserves necessary to bring a new drug to market. I don’t see how we could continue to see significant advances in drug therapy without providing the incentive of exclusivity that a drug patent provides.

28

Then how did humans innovate before patent monopolies?

Just because something is expensive, doesn’t justify a rights violation.

Non sequitur?

Please don’t make an argument from ignorance.

You cannot and do not know this.

I don’t see how we can build the pyramids without slave labor.

29

The liability cost has to be added to the costs of development, testing and production and anticipated income from the eventual sale of the drug must be great enough to justify the huge expenses involved in bringing a drug to market. New developments could not move as fast as they do today without the incentive of profits promised by the favorable exclusivity of a drug patent. I imagine in the past developments were made very slowly and that many potential new developments were abandoned before fruition due to lack of resources, plus they didn’t have the liability issues we have today.

I do know from experience that it is difficult to enroll patients in research studies (especially children- “you want my kid to be your guinea pig?”) when the drug is provided for free. To get patients to pay to be in studies where the studies would cover the costs of bringing the drug to market, you would have to charge the patient over $100,000 each–I do know few would pay anything to be in a study, and no one would pay as much as they’d have to charge to cover costs.

When I present a real-life scenario and I ask the question, how do you get the resources to make these expensive new developments without the expectation that there will be income to cover costs and provide some profit? It’s an honest question. Your unhelpful reply was don’t make an argument from ignorance. I don’t know about you, but I’m in this forum to learn, and asking questions is a good way to learn. Someone who is an Administrator/Moderator should be trying to educate those of us that are less knowledgeable about these topics. How about a non-sarcastic and enlightening answer to my questions?

30

So I did a little research to try and find out the true cost of drug discovery assuming the FDA didn’t exist. Unfortunately, all journal articles I could find related to drug R&D costs lumped all pre-human clinical trial costs into one category which includes animal trials, etc. That being said, I still hold my position that drug discovery pre clinical trials (human or animal) is not very expensive. It’s meeting the FDA (and whatever the EU has) requirements that results in the high costs. Also, all of the articles I read indicated that a big part of the cost was simply the time factor. The fact that the average time between drug discovery and market is between 9 and 12 years. This means 9-12 years of opportunity cost while your captial is tied up testing a product that may or may not come to term. The articles indicated that simply reducing the time to market can lead to significant cost reductions.

After all the reading I am still willing to stand by my original assumption that the cost of drug R&D is tied up in government approval. I can speculate on how the removal of government regulations would allow drug R&D to proceed in a profitable way but I would be unable to prove any of it since there is not a real world sample society to use as a proof. What I do know is that a significant part of the cost of drug R&D is directly related to government regulations so at the least, cost of drug development would decrease in a free market.

As an anectdotal example I currently am suffering from a cough that won’t go away. I have had it for going on two months now and it has completely ruined the quality of my life. I have seen several doctors about it and tried many different drugs to cure it all to no avail. I am at the point where I would be willing to pay for and try out a new drug if it meant that I might get better, even if it also meant I might get sick. A similar case can be made for terminally ill patients. Cancer treatments have some of the longest times to market. A large number of people die while cancer treatments are going through the 10-20 year FDA approval process, the majority of which I imagine would be willing to try out a new drug if it meant having a chance to live (even if it was only small or short duration). When it comes to non disease treating drugs (such as performance enhancing) there are a ton of healthy young individuals looking to get an easy edge on things willing to try out something new if it means maybe being the first to be better than his peers.

As for liability, this is something that is supported again by government intervention. All a pharmaceudical company in a free market has to do to avoid litigation is make sure the consumer knows everything the company knows so they can make an informed decision. If the company tells the consumer up front, “you are the first human to ever take this drug” then they can’t be held liable for anything in a free market. It’s only in the currenty governmental system that someone can sue someone else for ‘not trying hard enough’.

What it comes down to in my opinion is that the barrier to entry into the business is just too high. In the music industry anyone can record a song from their garage and sell it at the park to enter into the market. In the pharmaceudical industry I can’t cook up some new compound in my basement, test it on my dog then on myself and start selling it in the park (legally). I would first have to get FDA approval to cook the drug up in the first place, then FDA approval on my garage to make sure it meets regulatory requirements for a testing facility, then hire some number of people to make sure that my clinical trials meet the FDA standards (probably a lawyer, a tax accountant, a scientist, a doctor, etc.). This is before I even can begin to think about the costs of actually running any trials.

While I can appreciate that there won’t likely be a big market for something I cooked up in my garage just as there isn’t a big market for garage bands, this is unimportant because for every 1000 people cooking up drugs or music in their garage one of them may actually come up with something marketable and will be the one that reaches more than just friends, family, pets, and junkies.

31

I didn’t find LS’ reply to be sarcastic. The pyramids are quite an apt analogy. You don’t need coercion for people to innovate.

And if you do read Against Intellectual Monopoly by Boldrin and Levine (also free), there are plenty of examples of profitable ventures without the need of restraining competitors from using such information. In the first place, having no IP does not mean that entities will be required to share their findings to competitors. And long-term investments in other sectors are not hindered just because they are expensive, if the entrepreneurs foresee the investment to be profitable.

It is also argued that without the use of IP, a more intellectually challenging environment is fostered where researchers are more open to assisting each other and sharing insights, and building on these to come up with greater insights, so that progress in a field is quicker. Unlike in an IP system where it is quite possible that drug companies tend to rest on their laurels upon filing a lucrative patent.

The IP system also results in much credit grabbing when in fact innovations build on thousands of other less astounding yet essential insights developed by others before the patent awardee.

Don’t pay for the lecture of Kinsella for which he charges. He’s a scumbag (I’m kidding).

32

That’s called entrepreneurial risks. Again, this situation doesn’t justify a rights violation. Just because something is expensive to make, doesn’t mean you can put a gun to people’s head and make them pay any price, or prevent them from innovating a cheaper solution.

You want me to solve a problem that no individual human can solve.

An argument from ignorance is a logical fallacy. If pointing out that your argument is fundamentally flawed is unhelpful, then I am not sure how much help anyone can provide.

I was not sarcastic at all. And I am trying like hell to help you, but you have to be willing to help yourself. Go spend a week understanding Kinsella’s argument, and along the way, try to understand that the problems you are proposing are (1) not sufficient to justify violence in my opinion and (2) of a nature that we cannot answer deductively, and must be resolved via the market.

I hate when people pull the Admin/Mod card. I don’t owe you a thing. Kinsella and LvMI don’t owe you anything for free either.

33

I encourage you to not take liberty student’s “argumentation style” as a reflection of the community at large.

34

I’ve not treated Bruce unfairly, I have treated him like an adult. I also try to treat you like an adult, but when called on your errors in argument, you prefer to ignore the source of the criticism and pretend they don’t exist. People who are not interested in intellectual honesty have never thrived here.

If you’re looking for hugs, I can suggest some XXX forums.

35

Thank you Micah71381 for your thoughtful response to my questions, and thanks to Paul for referring me to a resource text for further information on the topic of IP. It is greatly appreciated.

As far as a free market, real-life example of drug development, we can look at 19th and early 20th century so-called “patent elixirs” of snake-oil salesmen. Often these elixirs contained harmful and addicting drugs and toxic heavy metals that caused defects in human function, organ-system damage and even death. After harming or killing a sufficient number of people who took these elixirs and most failing to provide any apparent health benefits, local communities would reject the particular snake oil. However, without communication technology like we have today, this rejection based on personal experience might not be known beyond the local community so affected.

If the patent medicine salesman stayed too long in one location, he stood the risk of being run out of town or worse. This could be avoided, of course, by simply proceeding to the next community with their elixir with or without changing the name or intended purpose of the product, and continuing their free enterprise venture. It didn’t matter so much whether the elixirs really improved anyone’s health as these snake-oil pushers were largely able to market their medicines on the basis of salesmanship and placebo effect. When the original Coke contained cocaine and large numbers of regular folks became addicted to Coke based on the cocaine in it, the FDA was brought into existence and the company had to remove the cocaine from their product. Are we better or worse off because of protections such as those provided by the FDA? Is objection to such regulation based on real-life benefit:harm analysis, or is it solely based on libertarian or Austrian economic philosophical prejudices? Also, is there such a thing as an inalienable right to free enterprise and freedom from government regulation of commerce?

Examples of drugs developed outside of government regulation and without any patent protections include aspirin and penicillin. But I wonder how many other hundreds of new developments might have been produced during the same time period if the profit motive were improved. There is no question that each new development in whatever field of endeavor is based on bits and pieces of ideas or discoveries from hundreds of different sources that are put together like a jigsaw puzzle to gain insight into or solve a particular problem. And the more widespread, open and accessible the knowledge base, the more readily the pieces can be put together.

As far as drug testing in terminally ill cancer patients, your description does not take into account many of the factors involved in cancer treatment. There are hundreds of chemotherapy drugs available for treating cancer that have been thoroughly tested for positive and negative effects, compared with each other for efficacy, and have been used clinically for years. It is a major undertaking to determine which drugs might be most helpful for any particular cancer patient depending on the type and stage of cancer present. Time is a major limiting factor, as, if the first choice of cancer drug treatment is unsuccessful, you may not get the chance to try your second choice of chemo because the patient expired. In the case of cancer and given these factors, it would be imprudent to recommend any untried treatment that would obstruct or delay treatment with an agent already proven to have a good shot at helping the patient.

Micah71381, about your cough. You say you’d be willing to try a medicine that’s not been tested and has unknown efficacy and adverse effects, but my guess is that, even though you’ve been to doctors and tried several treatments, you have not been properly diagnosed and treated with any number of available, tested medications of known efficacy and side-effects. It would be foolish to subject yourself to an unknown drug when you haven’t yet been properly diagnosed and treated with known effective drugs. The most common cause of cough lasting longer than two weeks is pertussis which is treatable with prolonged courses of antibiotics like erythromycin or azithromycin. Currently, there is an epidemic of pertussis which has spread across the U.S. and Canada and is spreading worldwide. A better solution is prevention of pertussis by vaccination of adults and children.

When a serious cough presents (one that impairs activities of daily life), diagnosis can usually be made by means of chest xrays or other imaging studies, pulmonary function studies, throat swab, sputum cultures, blood and other tests that can diagnose influenza, pertussis, mycoplasma, atypical mycobactium infection, strep and other bacterial infections, and RSV and other viral infections. Skin testing or a blood test can rule out tuberculosis. The particular diagnosis guides the selection of antibiotic therapy. Unfortunately, many physicians do not do appropriate testing necessary to make the diagnosis and subsequently fail to select the appropriate antibiotic treatment and the patient is not helped by prescribing amoxicillin to treat pertussis.

All drugs have potential adverse effects, so treating with amoxicillin with the diagnosis of pertussis is not only futile in terms of helping the patient, amoxicillin causes a fatal allergic reaction in some people; killing the patient with an unnecessary drug is not good form. If you had pertussis and tried an unknown drug rather than taking the appropriate antibiotic with a known profile, you’d be unnecessarily subjecting yourself to potentially serious risks.

36

What does the FDA do that the market cannot?

It’s based on reason and economics. Also, how can you determine benefit and harm? There is no competition for the FDA, there is no way to tell if someone else could have done better, or if the market demands what they provide.

Who owns you?

37

I think that the last point you touched on is the key here. You have given an example of how the community (i.e.: the market) would deal with the situation of people peddling placebos and harmful cures. You also mention that the problem here is that the peddler could just move towns but in the modern world with the internet and cameras, it would be very difficult to do such a thing. Also, in place of the FDA I have no problem with a private organization starting up that does the same thing as the FDA. Such an organization could offer it’s stamp of approval to medications and such that have met their standards of excellence. This organization could even implement a sort of ‘patent’ system of their own in which they would not stamp a competing product until after some amount of time has passed. This would allow cautious consumers to only purchase products stamped with this seal of approval while consumers willing to take on more risk could purchase un-approved products (at likely a lower price). On top of that the job of the FDA would be a competative market with potentially multiple companies offering different stamps. Some may have lower/different standards than others and the consumer could go with the one that they find gives them the best risk assessment relative to the cost of medications generally stamped by them.

It’s not the function of the FDA that I have a problem with, it’s the fact that it is backed by violent force that I have a problem with. I think it is up to people to decide what is healthy for them and what is not (cocaine, alcohol, caffeine, sugar, etc.) and people should not enlist the use of violent force to push their beliefs on what is healthy and what is not onto other people. While I personally would not ingest a product that had cocaine in it just as I don’t ingest products with caffeine or alcohol in them doesn’t mean that I am willing to use violence against people who choose to do so of their own accord. Then again, I won’t stop someone from shooting themselves in the head either (their choice) and possibly this is where you and I disagree.

I appreciate your feedback on my cough. The problem with most of the potential diagnosis for my cough is that it has no other symptoms, it goes away when I am supine/prone, is alleviated by humidity/heat and aggravated by cold which seems to indicate asthma. I have already had X-Rays done and the only thing that showed was slight hyperaeration (again pointing at asthma). I am looking into getting a PFT as the next step which brings me back to the market situation.

Because I am young and live a healthy lifestyle my risk for medical problems is low. I also am self employed which means I would have to pay for insurance entirely out of pocket which comes to about $200/month for anything under ~$10,000 annual deductible. The reason for this is because insurance companies aren’t allowed to discriminate (again, due to government regulation) so they can’t offer me a more affordable rate due to my lifestyle choices, genetic background, etc. Therefore it’s not in my best interest (risk:reward) to have anything but emergency insurance (something that covers me in the case of $10k+ medical bills). This of course means I am paying for all my medical bills out of pocket so the course of treatment optimal for me is impacted by cost, unlike a traditionally insured patient. This means that a $700 PFT+Pulmonologist visit is lower on my list of things to try then a throat swab at a walk-in clinic even if my symptoms indicate that a PFT is more likely to show something. If there were some low-cost treatment available that I could try with no guarantee of success (but a possibility) there is a good chance I would be interested in trying it before footing a $700 bill to get a more accurate diagnosis. Of course, because I am not a high risk taker and I do have money I may not be willing to be a first human subject but I would be willing to try something that has some preliminary findings but nothing conclusive, if the cost was right.

38

Also, is there such a thing as an inalienable right to free enterprise and freedom from government regulation of commerce? - Bruce Ogden

The premise here makes me uneasy. It would be incredibly depressing if by default we consider government to be the ultimate arbiter of the justness of our actions. It’s like saying, “I’d like to eat pizza. I hope there’s a government ordinance that permits it. I’ll have to find out before eating pizza.” Freedom should be a given, not the exception.

39

Bruce apparently is a tea party conservative, so I’m not sure he’s fully considered the concept of self-ownership and the efficacy of property rights.

40

In an IP-less world it would be impossible to tell what “Pepsi” is in opposition to “Coca-Cola”: if they don’t hold the rights to their own trademarks delineating one from the other is fruitless. Kinsella has to put up a rather convoluted defense to this… he says that if you bought a burger branded as one thing that actually tastes like another you should have the right to sue (trademark rights moving from provider to consumer). But that does not (and cannot) address situations in which products are indistinguishable. If I open a store called KFC right next to a “real” KFC, and my menu is exactly the same as the one next door, there is no issue of fraud. My bargain bucket is identical to theirs - no fraud is committed, because as a consumer you are getting exactly the product advertised. You can’t sue and say you thought you were buying from the real KFC… there is no “real” KFC.

This assumes free markets are simple mechanisms made up only of direct buyers and sellers. What if I am a wholesaler or reseller of Pepsi, and I work out I can produce something called Pepsi, with the exact same labelling, and produce a higher volume of it for less than Pepsi is able to charge? Pepsi has no right to its own brand, because we now have no IP, and the stuff inside the can is exactly the same as the stuff in the original Pepsi. As a consumer you won’t know the difference, and my product is attractive to stores because it’s identical to the old Pepsi and sells through at more for less. This is not a good idea for any capitalist society. You would end up with a stagnant world in which hardly any innovation took place, and where it did it would be by huge faceless monopolies by any other name. A modicum of IP, to the extent at least of brand names attached to products, protects everyone, and I can see no real disadvantage.