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A CHALLENGE TO Some disclaimers...

Are Intellectual Property


PUNDITS: trademark TM
Laws a Good Thing?
For those of you still insistent upon the Although copyrights and patents hold no place
position that intellectual property does in a world of true property rights, trademark is
a separate issue. Consumers should be able to
foster innovation, know what products they are buying and from
we challenge you to name even a whom they are buying them. If a company is
selling a watered-down version of Coca-Cola
single case of a new industry and claiming that the product is genuine, then “What?! Are you out of your mind?!” you
emerging as a result of the pro- that company should still be held liable for
fraud. Trademark has played a role in keeping
might be thinking right now. “Of course
tection of existing patent laws. fraudulent activity at a minimum. However, intellectual property protection is a good
any effort toward legal reform of copyright and thing! It makes sure people have the
patent law will need to consider how to limit
incentive to profit from innovation,
For more information on why copyright the use of trademark to prevent its use as a
substitute for copyrights and patents. doesn’t it? Shouldn’t we have control
and patent laws should be reconsidered,
please visit or consult: over our own property?”
Rights to privacy should always be protected. In
 Center for the Study of Innovative the case of the ink pen that was replicated at the These are perfectly valid responses, but you may
Freedom (c4sif.org) snap of a finger, if the information regarding its
want to consider the case that copyright and patent
 design had been taken in an instance of trespass
Against Intellectual Monopoly (A laws do not encourage further innovation and
highly recommended book available to personal property, then of course, the replica-
tor should be held liable for trespass but not for
industry growth. Rather, we are willing to argue
for free in PDF at
theft. Once that information is out there, it’s any- that IP laws have exactly the opposite effect.
levine.sscnet.ucla.edu/general/
intellectual/againstfinal.htm) body’s to do with as they please (e.g. Wikileaks)
and cannot be restituted as physical property Not only does IP stagnate progress, but it actually
 The Ludwig von Mises Institute can. So, when a student is guilty of plagiarism, infringes upon real (or scarce) property rights.
(mises.org) she is not guilty of theft, but only of breaking con-
 Againstmonopoly.org tract with either the school or the teacher.
Intellectual Property Infringes Intellectual Property Stagnates What Happens in the Absence of
Upon Actual, Scarce Property Innovation, Knowledge, & Growth Intellectual Property?
Let us say that I have a sleek ink pen that I The history of economic development is the story of When there is no government-granted monopoly
designed myself and intend to profit from. imitation and incremental improvements upon those in place over the production or expression of
imitations. Eli Whitney did not invent the cotton gin— something, then the producer is now forced to
Now let us assume that simply by snapping
he was one in a long line of innovators who improved stay competitive by making improvements upon
your fingers, you now have an exact replica
upon ideas that came before him. the original object. If I put a book on the market
of that pen. If you have done nothing to for $25 and it is not protected by copyright,
Despite their own modest contribution to the devel-
harm or reduce my own physical property, someone else might publish the same book for
opment of the airplane, in 1906, the Wright brothers
then should you be held liable for damages? $12. Instead of sitting back and filing suit, I now
managed to obtain a patent covering virtually any-
must either produce a higher quality book than
thing resembling an airplane. While refusing to de-
my competitor or make it less expensive.
vote any effort to selling their own airplane, they did
In effect, this is precisely what happens invest an enormous amount of effort in legal actions
when others reproduce (to a potentially to prevent others from selling airplanes. Fortunately
infinite extent) the original ideas of any for the history of aviation, the Wright brothers had
The fashion industry is an example of an industry
individual or group. The patent or copy- little legal clout in France, where airplane develop-
functioning without much IP protection. Enormous
right thus keeps others from doing what ment began in earnest about 1907. By the time the
innovation occurs every three to six months, with a
United States entered WWI, French planes were used
they wish with their own physical prop- few top designers racing to set the standards that
instead of American ones.
erty (raw materials, machinery, etc.) will be adopted by the wealthy first and widely imi-
tated by the mass producers of clothing for every-
If you believe that you should be held liable one else shortly after. As one example among many
for damages, then you must believe that peo- in the industry, the Spanish clothing company Zara
ple also own the value of their property. and its many imitators show that the original inno-
However, if I buy an ounce of gold at a value vator keeps innovating and keeps getting richer
During the period of James Watt’s patents on the while everyone benefits.
of $1400 today and then a week later, if the
steam-powered engine, the UK added about 750
market supply of gold has significantly in- horsepower of steam engines per year. In the thirty
Free software licenses allow most open-source soft-
ware to be written by large and loosely organized
creased (or has been replicated), should I years after Watt’s patents had expired, additional
teams of programmers, each contributing small piec-
still be entitled to $1400 when I decide to sell horsepower was added at a rate of more than 4,000
es of code and all benefiting from shared infor-
the gold? per year. Moreover, the fuel efficiency of steam en-
mation and ideas. Similar “open-source” success sto-
gines changed little during the period of Watt’s patent;
ries are in the American automobile industry, the
however, between 1810 and 1835 (after the patent’s
Swiss and German chemical industries, the oxygen
expiration) it is estimated to have increased by a factor
steelmaking industries, the Italian textile and fashion
of five.
industries, the Swiss watch industry, the Czech and
Venetian glass industries, and so on and so forth.