Muutokset

* kopioitu pdf:stä http://www.dklevine.com/papers/ip.ch.1.m1004imbookfinal01.pdf

== Chapter Luku 1: Introduction Johdanto ==

Boldrin & Levine: Against Intellectual Monopoly, Chapter 11Chapter 1: IntroductionIn late Vuoden 1764loppupuolella, while repairing a small korjatessaan pientä Newcomen steamengine-höyrykonetta, the idea of allowing steam to expand and condense inseparate containers sprang into the mind of James WattWattin mieleen tuli ajatus erillisissä astioissa laajenevasta höyrystä. He spentthe next few months in unceasing labor building a model of thenew engineMuutamat seuraavat kuukaudet hän uurasti lakkaamatta rakentaakseen mallin uudesta koneesta. In Vuoden 1768elokuussa, after a series of improvements and substantialborrowinguseiden parannusten ja huomattavan lainanottamisen jälkeen, hän matkusti Lontooseen hakemaan patenttia idealleen. Hän teki seuraavat kuusi kuukautta paljon työtä patentin eteen. Seuraavan vuoden tammikuussa se vihdoinkin myönnettiin. Tuotannon osalta ei tapahtunut juuri mitään ennen vuotta 1775. Silloin, yhteistyökumppaninsa, he applied for a patent on the idearikkaan teollisuusmiehen Matthew Boultonin tuella, requiring him totravel to London in AugustWatt sai parlamentin myöntämään patentille jatkoaikaa vuoteen 1800 asti. Suuri valtiomies Edmund Burke puhui parlamentin edessä kaunopuheisesti taloudellisen vapauden nimissä tarpeettoman monopolin luomista vastaan – ilman vaikutusta. He spent the next six months workinghard to obtain his patent¹ Wattin kumppanin Boultonin yhteydet olivat liian vahvoja tullakseen voitetuksi pelkän periaatteen avulla. It was finally awarded in January of thefollowing year. Nothing much happened by way of productionuntil 1775Kun Wattin patentti oli varmistettu ja tuotanto aloitettu, huomattava osa hänen energiastaan kului kilpailevien keksijöiden torjumiseen. ThenVuonna 1782 Watt varmisti itselleen ylimääräisen patentin, with a major effort supported by his businesspartnerjoka tuli ”tarpeelliseksi sen seurauksena, the rich industrialist kun [Matthew ] Wasborough ennätti niin epäreilusti kehittää ensimmäisenä kampiliikkeen”.² Vieläkin dramaattisemmin 1790-luvulla, kun ylivoimainen ja itsenäisesti suunniteltu Hornblower-moottori saatettiin tuotantoon, Boulton, ja Watt secured anAct of Parliament extending his patent until the year 1800kävivät sen kimppuun koko oikeusjärjestelmän voimalla. The³great statesman Edmund Burke spoke eloquently in Parliament inthe name of economic freedom and against the creation ofunnecessary monopoly – but to no availWattin patenttien aikakaudella Iso-Britanniassa höyrykoneiden yhteenlaskettu teho lisääntyi 750 hevosvoimalla vuosittain. 30 vuotena patenttien jälkeen lisää tehoa tuli yli 4000 hevosvoimaa vuosittain. Sen lisäksi höyrykoneiden polttoainehyötysuhde muuttui vain vähän Wattin patentin aikana, kun taas vuosien 1810 ja 1835 välillä sen on arvioitu parantuneen viisinkertaiseksi.⁴1 The connections ofWatt’s partner Boulton were too solid to be defeated by simpleprincipleKun Wattin patentit raukesivat, ei koettu pelkästään räjähdysmäistä kasvua höyrykoneiden tuotannossa ja tehossa, mutta höyryenergiasta tuli viimeinkin teollista vallankumousta eteenpäin ajava voima.Once Watt’s patents were secured and production startedSeuraavan 30 vuoden aikana höyrykoneita muunneltiin ja paranneltiin, aja olennaiset keksinnöt kuten höyryjuna, höyrylaiva ja höyryllä toimiva kehruukone tulivat yleiseen käyttöön. Olennainen innovaatio oli korkeapaineinen höyrykone – kehitys jonka Watt esti strategisesti patenttiaan käyttämällä. Monet uudet parannukset höyrykoneeseen, kuten esimerkiksi William Bullin, Richard Trevithickin ja Arthur Woolfin, tulivat saataville vuonna 1804: vaikkakin ne oli kehitetty jo aikaisemmin, niitä ei voitu ottaa käyttöön ennen kun Boultonin ja Wattin patentti oli rauennut. Kukaan näistä keksijöistä ei halunnut samaa kohtaloa kuin Jonathan Hornblower.⁵substantial portion of his energy was devoted to fending off rivalinventors. In 1782Ironisesti, sama patenttijärjestelmä, jota Watt secured an additional patentkäytti kilpailijoidensa murskaamiseen, made“necessary in consequence of haittasi myös hänen omaa työtään paremman höyrykoneen kehittämisessä.Olennainen rajoite alkuperäisessä Newcomenin moottorissa oli kyvyttömyys tuottaa tasaista pyörivää liikettä.. having been so unfairlyanticipatedKätevin ratkaisu ongelmaan, by [Matthew] Wasborough in the crank motionjossa yhdistyi kampi ja vauhtipyörä, riippuivat rakennustavasta, jonka James Pickard oli patentoinut, mikä esti Wattia käyttämästä sitä.”2More dramaticallyWatt teki myös itse useita yrityksiä tehokkaamman voimansiirron kehittämiseksi, in the 1790silmeisesti päätyen kuitenkin samaan lopputulokseen kuin Pickard. Patentin olemassaolo pakotti Wattin kehittämään tehottomamman ”aurinko ja planeetta” -vaihteiston. Vasta vuonna 1794, when the superior Hornblowerengine was put into productionPickardin patentin rauettua, Boulton and ja Watt went after himwith the full force of the legal systemottivat käyttöön taloudellisesti ja teknisesti ylivoimaisen kammen.⁶3During the period of Watt’s patents the UWattin patenttien raukeamisen vaikutus hänen imperiumilleen voi myös tulla yllätyksenä. Kuten saattoi odottaa, patenttien rauetessa ”useita höyrykoneita valmistavia yrityksiä perustettiin, jotka käyttivät herra Wattin kehittämiä periaatteita”. Kuitenkin Wattin kilpailijat ”pääasiallisesti tähtäsivät ennemminkin halpuuteen kuin laatuun.K” Lopputuloksena voimme havaita, että heitä ei suinkaan ajettu markkinoilta, vaan ”useita vuosia jälkeenpäin Boulton ja Watt pitivät hintojaan ylhäällä ja saivat silti enemmän tilauksia. added about”⁷750 horsepower of steam engines per year. In the thirty yearsfollowing Watt’s patentsItseasiassa vasta sen jälkeen, additional horsepower was added at arate of more than 4kun heidän patenttinsa raukesi,000 per yearalkoivat Watt ja Boulton todenteolla valmistamaan höyrykoneita. Sitä ennen he lähinnä keskittyivät suurten monopolististen rojaltien keräämiseen lisenssien avulla. MoreoverAliurakoitsijat tuottivat suurimman osan osista, the fuel efficiency ofsteam engines changed little during the period of Watt’s patent;ja Boulton ja Watt lähinnä valvoivat, kun asiakkaat kokosivat komponentit.while between 1810 and 1835 it is estimated to have increased by afactor of fiveSuuressa osassa historiikkeja James Wattia pidetään sankarillisena keksijänä, vastuullisena teollisen vallankumouksen alkamisesta. Faktat viittaavat toisenlaiseen tulkintaan. Watt oli yksi monista höyryvoimaa kehitelleistä älykkäistä keksijöistä 1700-luvun loppupuoliskolla. Sen jälkeen kun hän pääsi askeleen edemmäs muita, hän pysyi siellä – ei paremman innovaation, vaan tehokkaamman oikeusjärjestelmän hyväksikäytön ansiosta. Eikä siitä, että hänen yhteistyökumppaninsa oli rikas mies, jolla oli vahvoja yhteyksiä parlamenttiin, ollut ainoastaan pientä apua.4After the expiration of Watt’s patentsOliko Wattin patentti ratkaiseva kannustin, joka tarvittiin tuomaan esille hänen sisäinen keksijänsä, not only was therean explosion in the production and efficiency of engineskuten perinteisesti historiankirjat ehdottavat? Vai myöhästyttikö hänen oikeusjärjestelmän hyväksikäyttönsä kilpailun tukahduttamiseksi teollista vallankumousta vuosikymmenen tai kaksi? Vielä laajemmin, ovatko kaksi olennaista nykyisen immateriaalioikeutemme osaa – patentit ja tekijänoikeudet – lukuisine vikoineen, välttämätön paha jota meidän on ylläpidettävä nauttiaksemme keksimisen ja luomisen hedelmistä? Vai ovatko ne vain täysin turhia, but steamjäännöksiä ajalta jolloin valtiot myönsivät rutiininomaisesti monopoleja suosituille ylhäisille? Tähän kysymykseen etsimme vastausta.power came into its own as the driving force of the industrialrevolutionWattin tapauksessa vuoden 1769 ja erityisesti vuoden 1775 patentit todennäköisesti myöhästyttivät höyrykoneen laajaa käyttöönottoa: kehitys tukahtui kunnes Wattin patentti raukesi, ja hyvin harvoja höyrykoneita rakennettiin hänen monopolinsa aikana. Over a thirty year period steam engines were modifiedand improved as crucial innovations such as the steam trainVälittömästi patentin raukeamisen jälkeen tapahtuneiden keksintöjen määrästä voimme päätellä, thesteamboat and the steam jenny came into wide usageettä Wattin kilpailijat vain odottivat ennen omien keksintöjensä julkistamista. Tämän ei pitäisi tulla yllätyksenä: uusien höyrykoneiden, olivat ne kuinka paljon Wattin koneita parempia, piti käyttää erillistä lauhdutinta. The keyinnovation was the high-pressure steam engine – development ofwhich had been blocked by Watt’s strategic use of his patentKoska vuoden 1775 patentti tarjosi Boultonille ja Wattille monopolin kyseiselle idealle, monet muut sosiaalisesti ja taloudellisesti arvokkaat muutokset jäivät ottamatta käyttöön.Boldrin & Levine: Against Intellectual MonopolySamalla tavalla, vuoteen 1794 asti Boultonin ja Wattin koneet olivat tehottomampia kuin ne olisivat voineet olla, Chapter 1koska Pickardin patentti esti käyttämästä ja parantamasta ideaa kammen ja vauhtipyörän yhdistelmästä.2Many new improvements to the steam engineNäemme myös kuinka huonosti Wattin keksijäntaidot olivat huonosti allokoitu: huomaamme hänen käyttäneen enemmän aikaa lakijärjestelmän parissa muodostaakseen ja säilyttääkseen monopolinsa kuin hän käytti aikaa varsinaiseen koneensa paranteluun ja tuotantoon. Taloudellisesta näkökulmasta katsoen Watt ei olisi tarvinnut niin pitkään kestänyttä patenttia – on arvioitu että vuoteen 1783 mennessä – 17 vuotta ennen hänen patenttinsa raukeamista – hänen yrityksensä oli päässyt omilleen. Edelleen patentin raukeamisen jälkeen Boulton ja Watt kykenivät ylläpitämään huomattavaa markkinaosuutta, vain koska olivat ensimmäisiä, such as those ofhuolimatta siitä faktasta että heidän kilpailijoillaan oli 30 vuotta aikaa oppia tekemään höyrykoneita. William BullVahingollista yritystä tukahduttaa kilpailua ja hankkia erityisiä etuoikeuksia kutsutaan taloustieteilijöiden piirissä ylivoiton tavoitteluksi (rent-seeking). Historia ja arkijärki ovat osoittaneet sen olevan laillisen monopolin myrkyllinen hedelmä. Wattin yritys jatkaa hänen vuoden 1769 patenttiaan on erityisen törkeä esimerkki ylivoiton tavoittelusta: patentin jatkaminen oli selkeästi tarpeeton antamaan kannustin alkuperäiselle keksinnölle, joka oli jo tapahtunut. Sen lisäksi näemme, Richard Trevithickkuinka Watt käyttää patentteja työkaluna kilpailijoidensa, and Arthur Woolfkuten Hornblowerin, becameWasburoughin ja muiden innovaatioiden tukahduttamiseksi.available by 1804Hornblowerin kone on täydellinen esimerkki asiasta: although developed earlier these innovationswere kept idle until the se oli huomattava parannus Wattiin verrattuna, koska se esitteli uuden käsitteen ”compound enginestä” jossa oli enemmän kuin yksi sylinteri. Tämä, eikä Boultonin ja Wattin malli, oli pohjana höyrykoneiden kehitykselle sen jälkeen, kun heidän patenttinsa oli rauennut. Kuitenkin, koska Hornblower rakensi Wattin aiemman työn pohjalta käyttäen hyväksi ”erillistä höyrystintä”, Boulton and ja Watt patent expiredpystyivät pysäyttämään hänet oikeusteitse ja laittamaan tehokkaasti lopun höyrykonekehitykselle. Monopoli ”erilliselle höyrystimelle”, eli hyödylliselle innovaatiolle, esti samalla tavalla hyödyllisen innovaation, eli ”compound enginen” kehitystä, hidastaen täten taloudellista kasvua. Tällainen innovaation hidastaminen on klassinen esimerkki siitä, mitä kutsumme aineettoman omaisuuden tehottomuudeksi, tai IP-tehottomuudeksi lyhyemmin. None ofthese innovators wished to incur the same fate as JonathanHornblowerLopuksi, höyrykone otettiin käyttöön hitaassa tahdissa ennen Wattin patentin raukeamista. Pitämällä hinnat korkealla ja estämällä muita tuottamasta halvempia ja parempia höyrykoneita, Boulton ja Watt vaikeuttivat pääoman kasautumista ja hidastivat talouskasvua.5IronicallyJames Wattin tarina on vahingollinen tapaus patenttijärjestelmän hyödyllisyydelle, not only did Watt use the patent system as alegal cudgel with which to smash competitionmutta me tulemme näkemään, ettei se ole epätavallinen. Uusi idea kehittyy melkeinpä sattumalta keksijälle kun hän on rutiininomaisesti toimimassa jonkin aivan toisenlaisen lopputuloksen saamiseksi. Patentti tulee vasta vuosia sen jälkeen ja se johtuu enemmänkin lainopillisen terävyyden sekä käytettävissä olevien resurssien käyttäminen ”hyvän onnen rattaiden voitelemiseen” kuin minkään muun. Viimein, kun patenttisuoja on hankittu, but his own effortskäytetään sitä usein työkaluna taloudellisen kasvun estämiseen ja kilpailijoiden satuttamiseen. at developing a superior steam engine were hindered by the verysame patent system Vaikka näkemys, jota tässä esitämme, voi vaikuttaa ikonisoivalta, se ei ole varsinaisesti uusi, eikä erityisemmin alkuperäinen. Frederic Scherer, patenttijärjestelmän arvovaltainen akateeminen tukija, tutkittuaan Boultonin ja Wattin tarinaa, totesi vuonna 1986 seuraavanlaisesti:''Jos patenttisuojausta ei olisi ollut olemassa, ... Boulton ja Watt olisivat varmasti joutuneet seuraamaan varsin toisenlaista bisnestaktiikkaa siihen verrattuna mitä he used to keep competitors at baykäyttivät. Animportant limitation of the original Newcomen engine was itsinability to deliver a steady rotary motionSuurin osa yrityksen voitoista oli saatu moottorien käytön rojalteista eikä valmistettujen moottorien komponenteista, ja ilman patenttisuojaa yritys ei olisi tietenkään kyennyt keräämään rojalteja. The most convenientsolutionVaihtoehtona olisi ollut keskittyä tuotantoon ja huoltopalveluihin päätulonlähteenä, involving the combined use of the crank and a flywheeljoka itseasiassa oli käytäntö,relied on a method patented by James Pickardjota alettiin omaksua 1790-luvulla kun erillisen höyrystimen patentin raukeaminen alkoi lähestyä... On mahdollista todeta vieläkin varmemmin, which preventedettä patenttiriitely 1790-luvulla ei suoraan kannustanut teknologista kehitystä... Boultonin ja Wattin kieltäytyminen lisenssien myöntämisestä muille moottorinvalmistajille erillisen höyrystimen valmistamiseksi selkeästi haittasi sekä kehitystä että parannusten omaksumista.''⁸ Watt from using it. Watt also made various attempts at efficiently* * *transforming reciprocating into rotary motion, reaching,apparentlyTeollisesta vallankumouksesta on jo aikaa, the same solution as Pickardmutta kysymys aineettomasta omaisuudesta on edelleen ajankohtainen. But the existence of apatent forced him to contrive an alternative less efficientmechanical deviceTätä kirjaa kirjoitettaessa yhdysvaltalaistuomari James Spencer on uhkaillut kolmen vuoden ajan sulkea laajasti käytetyn Blackberryn viestintäverkon – patenttikiistan takia.⁹ Eikä Blackberry ole itsekään synnitön: vuonna 2001 Blackberry haastoi oikeuteen Glenayre Electronicsin, the “sun and planet” gear. It was only in 1794koska kyseinen yritys loukkasi Blackberryn patenttia,after the expiration of Pickard’s patent that Boulton and Wattadopted the economically and technically superior crankjoka koski "informaation puskemista isäntäsysteemistä mobiilidatakommunikaatiolaitteeseen".¹⁰6The impact of the expiration of his patents on Watt’sSamanlainen sota on käynnissä tekijänoikeuksien puolella - Napster-palvelu suljettiin liittovaltion tuomarin toimesta heinäkuussa 2000 kiistassa koskien tekijänoikeudella suojattujen tiedostojen jakoa.¹¹ Tunteet käyvät kuumina kummallakin puolella. Jotkut tekijänoikeusvastaiset libertaristit käyttävät slogania “informaatio vain haluaa olla vapaana”. Toisessa ääripäässä suuret musiikki- ja ohjelmistoyhtiöt väittävät maailman ilman immateriaalioikeuksia olevan maailma ilman uusia ideoita. empire may come as a surprise. As might be expected, when theOsa tekijänoikeusväittelyn katkeruudesta heijastuu Stephen Manesin hyökkäyksessä Lawrence Lessigiä kohtaan:patents expired “many establishments for making steam-engines ofMr. Watt's principle were then commenced'Stanfordin lakiprofessorin ja median suosikin Lawrence Lessigin mukaan “liikkeen täytyy alkaa kaduilta”, jotta korruptoitunutta kongressia, ylikeskittynyttä mediaa ja ylihintaista oikeusjärjestelmää vastaan voidaan taistella. Vastoin Lessigin avautumista... “fair use” -poikkeukset nykyisessä tekijänoikeuslaissa...” Howeverovat niin ekspansiivisia, että melkeinpä ainoa asia, jota leikkaamalla-ja-liittämällä ei voi tehdä tekijänoikeuden alaiselle teokselle laillisesti, Watt’scompetitors “principally aimed aton kopioida merkittävää osaa siitä...cheapness rather than¹²'' excellenceVarmastikaan Lessig ei ole nykyisen tekijänoikeuslain ystävä.” As a resultMutta huolimatta Stephen Manesin väitteestä, we find that far from being driven out ofhän uskoo tuottajien ja kuluttajien välisten oikeuksien tasapainottamiseen: hänen kirjansa Free Culture puhuu jatkuvasti tästä tasapainosta ja siitä, kuinka se on menetetty nykyaikaisessa laissa.¹³business “Boulton and Watt for many years afterwards kept uptheir price and had increased ordersKuten Lessig, monet taloustieteilijät ovat skeptisiä nykyisen lain suhteen - 17 huomattavaa taloustieteilijää, mukaanlukien useita Nobel-palkinnon voittaneita, jättivät kirjelmän Yhdysvaltain korkeimmalle oikeudelle kannattaakseen Lessigin haastetta tekijänoikeuden pituuden kyseenalaistamiseksi. Kuten Lessig, myös taloustieteilijät tunnustavat immateriaalioikeuksien roolin: kun lakimiehet puhuvat oikeuksien tasapainottamisesta, taloustieteilijät puhuvat kannustimista.”Lainataksemme kahden huomattavan taloustieteilijän, Robert Barron ja Xavier Sala-i-Martinin oppikirjaa:7In fact''Olisi hyvä antaa kaikki olemassa olevat keksinnöt vapaasti kaikkien tuottajien käyttöön, it is only after their patents expired that Boulton andWatt really started to manufacture steam enginesmutta tämä käytäntö epäonnistuu tarjoamaan... kannustimia myöhempiin keksintöihin. Vastakkain ovat olemassaolevien ideoiden käyttö ja innovatiivisen toiminnan kannustin. Before then their¹⁴''activity consisted primarily of extracting hefty monopolisticroyalties through licensingTosiaan, kun monet meistä nauttivat mahdollisuudesta ladata vapaasti musiikkia internetistä, me olemme myös huolissamme siitä, kuinka muusikko voi ansaita elantonsa mikäli hänen musiikkinsa on välittömästi jaossa ilmaiseksi. Independent contractors produced mostof the partsVaikka keskustelu tekijänoikeuksista ja patenteista käykin kiivaana, on olemassa yleinen hyväksyntä sille, and Boulton and Watt merely oversaw the assembly ofthe components by the purchasersettä jonkinlaista suojaa tarvitaan keksijöille ja luojille, jotta he voisivat nauttia työnsä hedelmistä. "Informaatio vain haluaa olla vapaana" -retoriikka vihjaa, ettei kukaan saisi ansaita omilla ideoillaan.In most historiesTästä huolimatta ei näytä olevan kovinkaan vahvaa vaatimusta, James Watt is a heroic inventorettä samalla kun muiden on aivan hyväksyttävää kerätä oman työnsä hedelmät,keksijöiden ja luojien täytyisi tulla toimeen muiden hyväntekeväisyydellä.responsible for the beginning of the industrial revolution. The factssuggest an alternative interpretationKaikesta tunteellisuudesta huolimatta näyttää siltä, että kummatkin osapuolet ovat samaa mieltä siitä, että immateriaalioikeuslakien tarvitsee löytää tasapaino luomistyön kannustimien tarjoamisen ja olemassa olevien ideoiden käytön vapauden välille. Watt is one of many cleverinventors working to improve steam power in the second half ofthe eighteenth centuryToisin sanoen, kummatkin osapuolet ovat yksimielisiä siitä, että immateriaalioikeuslait ovat "tarpeellinen paha" joka synnyttää uutta innovaatiota, ja erimielisyys koskee sitä, mihin kohtaa viiva olisi piirrettävä. After getting one step ahead of the packAineettoman omaisuuden puolustajat pitävät nykyisiä monopolituottoja juuri ja juuri riittävinä, hekun taas sen vastustajat pitävät niitä aivan liian korkeina.remained ahead not by superior innovation, but by superiorexploitation of the legal systemOma analyysimme johtaa erimielisyyteen kummankin puolen kanssa. Järkeilymme kulkee seuraavanlaisesti. Jokainen haluaa monopolin. Kukaan ei halua kilpailla omien asiakkaidensa tai matkijoiden kanssa. Tällä hetkellä patentit ja tekijänoikeudet antavat tiettyjen ideoiden tuottajille monopolin. Luonnollisesti muutamat ihmiset tekevät jotain myös vastikkeettomasti. The fact that his business partnerBoldrin & LevineUusien hyödykkeiden luojat eivät eroa vanhojen hyödykkeiden tuottajista: Against Intellectual Monopolyhe haluavat saada korvauksen vaivannäöstään. On kuitenkin pitkä ja vaarallinen hyppäys väitteestä, että keksijät ansaitsevat korvaukset vaivannäöstään siihen, että patentit ja tekijänoikeudet, eli monopolioikeudet, ovat paras tai ainoa tapa tuottaa se korvaus. Väitteet kuten "patentti on ''se'' tapa, Chapter 13was a wealthy man with strong connections in Parliamentjolla jotakuta palkitaan arvokkaan kaupallisen idean keksimisestä, ovat yleisiä bisnes-, was nota minor helplaki- ja talouslehdissä.Was Watt’s patent a crucial incentive needed to trigger hisinventive genius Kuten tulemme näkemään, on olemassa monia muitakin tapoja, joilla keksijöitä palkitaan, as the traditional history suggestsjopa huomattavan suuresti, ja joista monet ovat parempia yhteiskunnalle kuin se monopolivoima, jonka patentit ja tekijänoikeudet nykyisellään suovat. Koska keksijöitä voidaan palkita myös ilman patentteja ja tekijänoikeuksia, meidän tulee kysyä: Onko totta, että aineeton omaisuus saavuttaa halutun päämäärän, eli luo kannustimia uuden keksimiselle ja luomiselle, jotka puolestaan korvaavat niistä aiheutuvat haitat? Or did his useof the legal system to inhibit competition set back the industrialrevolution by a decade or two? More broadlyTämä kirja tarkastelee sekä todisteita että teoriaa. Johtopäätöksemme on, että luojien omistusoikeudet voivat olla hyvin suojattuja ilman aineetonta omaisuutta, are the two essentialeikä aineeton omaisuus kasvata innovaatiota eikä uuden luomista. Se on tarpeeton paha.components of our current system of intellectual property – patentsand copyrights – with all of their many faults, a necessary evil we* * *must put up with to enjoy the fruits of invention and creativity? Orare they just unnecessary evilsTämä kirja kertoo taloustieteestä, ei laista. Tai toisin sanoen, tämä ei kerro millainen laki on, vaan millainen sen pitäisi olla. Jos olet kiinnostunut siitä, the relics of an earlier time whenkuinka todennäköisesti joudut vankilaan tiedostojen jakamisesta internetissä, tämä kirja ei ole sinulle. Jos olet kiinnustunut siitä, onko hyvä idea antaa lain estää sinua jakamasta tiedostoja internetissä, niin silloin tämä kirja on sinulle.governments routinely granted monopolies to favored courtiers?That is the question we seek to answerHuolimatta siitä, että tämä kirja ei ole laista, jotain taustatuntemusta laista silti tarvitaan ymmärtämään taloustieteelliset kysymykset. Tulemme tarkastelemaan taloustieteellisesti sitä, mitä viime aikoina on alettu kutsumaan "aineettomaksi omaisuudeksi", erityisesti patentteja ja tekijänoikeuksia. Itseasiassa on olemassa kolme erilaista aineettoman omaisuuden tyyppiä, jotka suurin osa lakijärjestelmistä tunnustaa: patentit, tekijänoikeudet ja tavaramerkit. In the specific case of WattTavaramerkit ovat luonnostaan erilaisia verrattuna patentteihin ja tekijänoikeuksiin: niiden tarkoitus on identifioida hyödykkeiden, the granting of the 1769 andpalveluiden ja ideoiden tuottajat. Kopiointi – mikä olisi tekijänoikeuden loukkaus – on hyvin erilaista verrattuna valehteluun – mikä olisi tavaramerkin loukkaus. Me emme tiedä hyvää syytä antaa markkinaosapuolten varastaa toisten identiteettejä tai naamioitua ihmisiksi, joita he eivät ole. Päinvastoin, on olemassa vahvoja taloudellisia hyötyjä siitä, että markkinaosapuolten annetaan vapaaehtoisesti identifioida itsensä. Vaikka voimmekin pohtia, onko välttämätöntä antaa Intelille monopolioikeutta käyttää sanaa "inside", on yleisesti ottaen hyvin vähän taloustieteellistä epäselvyyttä tavaramerkkien ansioista.especially of the 1775 patents likely delayed the mass adoption ofthe steam enginePatentit ja tekijänoikeudet, kaksi tekijänoikeuden muotoa joihin keskitymme, ovat debatin ja kiistelyn kohteena. Ne eroavat toisistaan suojan laajuudessa, jonka ne tarjoavat. Patentit koskevat erityisenlaista toteutusta ideasta – joskin viime vuosina Yhdysvalloissa on viime vuosina kiinnitetty yhä vähemmän huomiota erityisyyteen. Patentit eivät kestä ikuisesti: innovation was stifled until his patents expired;and few steam engines were built during the period of Watt’s legalmonopolyYhdysvalloissa 20 vuotta patenteille, jotka suojaavat valmistustekniikkaa, ja 14 vuotta muotoa suojaaville. From the number of innovations that occurredimmediately after the expiration of the patentPatentit tarjoavat suhteellisen laajan suojan: kukaan ei voi laillisesti käyttää samaa ideaa, vaikka hän keksisikin sen itsenäisesti, it appears thatilman patentin haltijan lupaa.¹⁶Watt’s competitors simply waited until then before releasing theirown innovationsTekijänoikeudet ovat skaalaltaan kapeampia, suojaten vain tiettyä yksityiskohtaista ja ainutlaatuista teosta – joskin samaan tapaan patenttien kanssa, skaala on laajentunut viime vuosina. This should not surprise us: new steam enginesTekijänoikeus on myös paljon pidempi kestoltaan kuin patentti – tekijän elinikä plus 50 vuotta monissa Bernin sopimuksen allekirjoittaneissa valtioissa,ja – Yhdysvalloissa Sonny Bono Copyright Extension Actin ansiosta – tekijän elinikä olus 70 vuotta.¹⁷ no matter how much better than Watt’sYhdysvalloissa tekijänoikeuksille asetettuja rajoituksia ei löydy patenttilaista. Kuten Stephen Manes aivan oikein tuo esiin hyökkäyksessään Lawrence Lessigiä vastaan, had to "fair use the idea of aseparate condenser" antaa tekijänoikeudella suojatun teoksen omistajalle rajoitettuja oikeuksia käyttää sitä, tehdä osittaisia kopioita siitä ja myydä niitä, riippumatta tekijänoikeuden omistajan mielihaluista. Because the 1775 patent provided Boulton andSen lisäksi tietyt johdannaisteokset ovat sallittuja ilman lupaa: esimerkiksi parodia on sallittua, kun taas jatko-osat eivät. Watt with a monopoly over that ideaSekä patenttien että tekijänoikeuksien tapaukessa, taloustieteellisestä näkökulmasta, laki on kaksiosainen: oikeus ostaa ja myydä kopioita ideasta, plentiful other improvementsof great social and economic value could not be implementedja oikeus kontrolloida kuinka ihmiset käyttävät omia kopioitaan. Ensimmäinen oikeus ei ole kiistanalainen. Bythe same tokenTekijänoikeuslaissa, kun sitä sovelletaan teoksen luojaan, until 1794 Boulton and Watt’s engines were lessefficient they could have been because the Pickard’s patentprevented anyone else from usingtätä kutsutaan usein "ensimmäisen myynnin oikeudeksi". Kuitenkin se jatkuu myös laillisena oikeutena muille myydä omistamiaan kopioita. Toinen oikeus sen sijaan on kiistanalainen, and improvingantaessaan aineettoman omaisuuden omistajalle oikeuden kontrolloida omaisuutta myynnin jälkeen. Tämä oikeus tuottaa monopolin – valtio velvoitetaan toimimaan sellaisia henkilöitä tai organisaatioita vastaan, the idea ofjotka käyttävät ideaa tekijänoikeuden tai patentin omistajan kiellosta huolimatta. combining a crank with a flywheelAineettoman omaisuuden paremmin tunnettujen muotojen – patenttien ja tekijänoikeuksien – lisäksi on myös vähemmän tunnettuja tapoja suojata ideoita.AlsoNäitä ovat sopimukset, we see that Watt’s inventive skills were badlyallocated: we find him spending more time engaged in legal actionkuten shrink-wrap- ja click-through-ehdot, joita kukaan ei ikinä lue ostaessaan ohjelmistoa. Sellainen on myös perinteisin suojauksen muoto – liikesalaisuus – sekä sen sopimusoikeudelliset ja juridiset muodot kuten salassapitosopimukset. Kuten patentit ja tekijänoikeudet, nämä kaikki keinot auttavat idean alkuperäistä omistajaa pitämään monopolin siihen.to establish and preserve his monopoly than he did in the actualimprovement and production of his engineMe emme tiedä yhtään legitiimiä argumenttia sen puolesta, että ideoiden tuottajat eivät saisi hyötyä keksinnöistään. Vaikka ideoita voisikin myydä ilman laillisia oikeuksia, markkinat toimivat parhaiten kun on olemassa selkeästi määritellyt omistusoikeudet. Ei ainoastaan keksijän omistusoikeus tulisi olla suojeltu, vaan myös niiden oikeudet, jotka ovat laillisesti hankkineet kopion ideasta, suoraan tai epäsuoraan, alkuperäiseltä keksijältä. Ensimmäinen kannustaa keksimään, jälkimmäinen kannustaa keksintöjen leviämistä, omaksumista ja parantamista. From a strictlyeconomic point of view Watt did not need such a long lastingpatent – it is estimated that by 1783 – seventeen years before hispatent expired – his enterprise had already broken evenMiksi kuitenkin pitäisi keksijöillä olla oikeus kontrolloida kuinka ostajat käyttävät ideaa tai luomusta? Tämä antaa keksijälle monopolin ideaan. IndeedMe viittaamme tähän oikeuteen "aineettomana monopolina",even after their patent expiredkorostaaksemme, Boulton and Watt were able toettä se on tämä kaikkia kopioita ideasta koskeva monopoli, joka on kiistanalainen, ei oikeus ostaa ja myydä kopioita. Valtio ei yleensä ylläpidä muiden hyödykkeiden tuottajien monopoleja. Tämä siksi, koska on laajalti huomioitu, että monopolit luovat monia sosiaalisia kustannuksia. Aineeton monopoli ei eroa tässä suhteessa. Haluamme esittää kysymyksen, luoko se myös sosiaalista hyötyä, joka ylittäisi nämä sosiaaliset kustannukset. maintain a substantial premium over the market by virtue of having* * *been first, despite the fact that their competitors had had thirtyyears to learn how to make steam enginesThe U.S.The wasteful effort Constitution allows Congress “To promote the progress of science and useful arts, by securing for limited times to suppress competition authors and obtainspecial privileges is referred inventors the exclusive right to by economists as rent-seekingbehaviortheir respective writings and discoveries. History ”¹⁸ Our perspective on patents and common sense show it to be copyright is a poisoned fruitsimilar one: promoting the progress of legal monopoly. Watt’s attempt to extend science and the duration useful arts is a crucial ingredient of hisBoldrin & Levine: Against Intellectual Monopolyeconomic welfare, from solving such profound economic problems as poverty, Chapter 141769 patent is an especially egregious example to such mundane personal nuisances as boredom. From a social point of rent seeking: view, and in thepatent extension was clearly unnecessary to provide incentive forview of the original inventionfounding fathers, which had already taken place. On top the purpose ofthis, we see Watt using patents as a tool and copyrights is not to suppress innovation byhis competitors, such as Hornblower, Wasborough and others.Hornblower’s engine is a perfect case in point: it was asubstantial improvement over Watt’s as it introduced enrich the few at the newconcept expense of the “compound engine” with more than one cyclindermany. Nobody doubts that J.This, and not the Boulton K. Rowling and Watt design, was the basis forfurther steam engine development after Bill Gates have been greatly enriched by their patents expiredintellectual property – nor is it surprising that they would argue in favor of it.However, because Hornblower built on But common sense and the earlier work U.S. Constitution say that these rights must be justified by bringing benefits to all of Watt,us.making use of his “separate condenser” Boulton and Watt wereable to block him in court The U.S. Constitution is explicit that what is to be given to authors and effectively put inventors is an end to steamengine developmentexclusive right – a monopoly. The Implicit is the idea that giving this monopoly over serves to promote the “separate condenser,”a progress of science and useful innovationarts. The U.S. Constitution was written in 1787. At that time, blocked the development idea of another equallycopyright and patent wasuseful innovationrelatively new, the “compound engine,” thereby retardingeconomic growthproducts to which they applied few, and their terms short. This retardation In light of the experience of innovation the subsequent 219 years we might ask: is a classical caseit true that legal grants of what we shall refer monopoly serve to as Intellectual Property-inefficiency, or IPinefficiency for short.Finally, there is promote the slow rate at which the steam enginewas adopted before the expiration progress of Watt’s patent. By keepingprices high science and preventing others from producing cheaper or betterthe useful arts?steam engines, Boulton and Watt hampered capital accumulationand slowed economic growthCertainly common sense suggests that it should.The story of James Watt How is a damaging case for musician to make a living if the benefitsof a patent systemmoment she performs her music, but we shall see that everyone else can copy and give it away for free? Why would the large corporations pay the small inventor when they can simply take his idea? It is not an unusual story.A new idea accrues almost by chance hard to imagine life without the innovator while he isinternet, andcarrying out a routine activity aimed at a completely different endtoday we are all jet setters.The patent comes many years after that and it is due more to amixture Is not the explosion of legal acumen creativity and abundant resources available to “oilinvention unleashed since the gears writing of fortune” than anything elsethe U.S. Finally, after Constitution a testimony to the powerful benefit of intellectual property? Would not the world without patentprotection is obtained, it is primarily used as a tool to preventeconomic progress and hurt competitors.While this view copyright be a sad cold world, empty of new music and of Watt’s role in the industrial revolutionmay appear iconoclastic, it is neither marvelous new nor particularly original.inventions?Frederic Scherer, a prestigious academic supporter of the patentsystem, after going through So the details of first question we will pose is what the Boulton world might be like without intellectual monopoly. Patents and Wattstory, concluded his 1986 examination of their story with thefollowing illuminating wordsHad there been no patent copyrights have not secured monopolies on all ideas at all times. It is natural then to examine times and industries in which legal protection at all,…Boulton andWatt certainly would for ideas have not been forced available to follow a businesspolicy quite different from that which they actuallyBoldrin & Levine: Against Intellectual Monopoly, Chapter 15followedsee whether innovation and creativity were thriving or were stifled. Most of It is the firm’s profits were derived fromroyalties on case, for example, that neither the use of engines rather than from internet nor the sale jet engine were invented in hopes ofmanufactured engine componentssecuring exclusive rights. In fact, and without patentprotection the firm plainly could not have collectedroyalties. The alternative would have been to emphasizemanufacturing and service activities we ordinarily think of “innovative monopoly” as the principalsource of profitsan oxymoron. We shall see that when monopoly over ideas is absent, which in fact was the policy adoptedwhen the expiration date of the patent for the separatecondenser drew near in the late 1790s…. It competition is possible toconclude more definitely fierce – and that the patent litigation activitiesof Boulton & Watt during the 1790s did not directly incitefurther technological progress…as a result innovation and creativity thrive. Boulton Whatever a world without patents and Watt’srefusal to issue licenses allowing other engine makers toemploy the separate-condenser principle clearly retardedthe development copyrights would be like, it would not be a world devoid of great new music and introduction of improvementsbeneficial new drugs.8***The industrial revolution was long ago. But the issue You will gather by now that we are skeptical ofintellectual property is a contemporary onemonopoly – as are economists in general. At Our second topic will be an examination of the time we wrotethis, Umany social costs created by copyrights and patents.S. District Judge Adam Smith – a friend and teacher of James Spencer had been threatening forthree years Watt – was one of the first economists to shut down the widely used Blackberry messagingnetwork – over explain how monopolies make less available at a patent disputehigher price.9 And Blackberry itself is notwithout sin: in 2001 Blackberry sued Glenayre Electronics forinfringing on its patent for “pushing information from a hostsystem to a mobile data communication device.”10A similar war is taking place over copyright – In some cases, such as the Napsternetwork was shut down by a federal judge in July production of 2000 music, this may not be a great social evil; in adispute over other cases such as the sharing availability of copyrighted filesAIDS drugs, it may be a very great evil indeed.11 Emotions run However, as we shall see, low availability and highon both sidesprice is only one of the many costs of monopoly. We have the anti-copyright slogan “information justwants to be free” promoted The example of James Watt is a case in point: by some civil libertarians. On making use of the otherextremelegal system, large music he inhibited competition and software companies argue that a worldwithout intellectual property would be a world without prevented his competitors from introducing useful new ideasadvances. We shall also see that because there are no countervailing market forces, government-enforced monopolies such as intellectual monopoly are particularly problematic.Some of the bitterness of the copyright debate is reflectedin Stephen Manes’ attack on Lawrence LessigAccording to Stanford law professor While monopoly may be evil, and media darlingLawrence Lessig, a “movement must begin while innovation may thrive in the streets”to fight a corrupt Congressabsence of traditional legal protections such as patents and copyrights, overconcentrated media it may be that patents andan overpriced legal systemcopyrights serve to increase innovation.The presumption in the U.S.Contrary to Lessig'srants...“Fair use” exceptions in existing copyright law...areso expansive Constitution is that they do, and that just about the only thing cut-benefits of more entertainment and-pastersBoldrin & Levine: Against Intellectual Monopoly, Chapter 1more6clearly can't do legally with a copyrighted work is directlycopy a sizable portion of itinnovation outweigh the costs of these monopolies.12Certainly Lessig the monopolies created by patents and copyright may be troublesome – but if that is no friend the cost of current copyright law. Yethaving blockbuster movies, despiteStephen Manes assertions to the contraryautomobiles and flu vaccine, he does believe inbalancing the rights most of producers us are prepared to put up with it. That is the rights position traditionally taken by economists, most of users: his bookFree Culture speaks repeatedly of this balance and how it has beenlost whom support patents and copyright, at least in modern lawprinciple.13Like Lessig, many economists are skeptical Some of current law– seventeen prominent economists, including several Nobel Prizewinners, filed a brief with them take the U.S. Supreme Court in support view that intellectual monopoly is an unavoidable evil if we are to have any innovation at all; other simply argue that at least some modest amount ofLessig’s lawsuit challenging the extension of the length intellectual monopoly is desirable to provide adequate incentive for innovation and creation. Our third topic will be an examination ofcopyright. Also like Lessig, economists recognize a role forthe theoretical arguments supporting intellectual property: where lawyers speak of balancing rightsmonopoly,economists speak of incentivesas well as counter-arguments about why intellectual monopoly may hurt rather than foster creative activity. To quote from a textbook by twoprominent economists Robert Barro and Xavier Sala-i-MartinIt would be [good] is crucial to make the existing discoveries freelyavailable recognize that intellectual monopoly is a double-edged sword. The rewards to all producers, but this practice fails to providetheinnovative effort are certainly greater if success is awarded a government monopoly...incentives for further inventions. A tradeoff arisesbetween restrictions on But the use existence of existing ideas and monopolies also increases therewards to inventive activitycost of creation.14IndeedIn one extreme case, while many of us enjoy the benefits of being able a movie that cost $218 to make had to freelypay $400,000download for the music from rights.¹⁹ As we will argue at length, theoretical arguments alone cannot tell us if intellectual monopoly increases or decreases creative activity. In the internetfinal analysis, we worry as well how themusician only justification for intellectual property is to make a living if her music is immediately givenaway for free.While a furious debate rages over copyrights that it increases – ''de facto'' and patents,there is general agreement that some protection is needed to securefor inventors substantially – innovation and creators creation. What have the fruits last 219 years taught us? Our final topic is an examination of their laborsthe evidence about intellectual monopoly and innovation. The rhetoricIs it a fact that “information just wants intellectual monopoly leads to be free” suggests more creativity and innovation? Our examination of the data shows no evidence that no one shouldbe allowed it does. Nor are we the first economists to profit from her ideas. Despite reach this, there does notconclusion. After reviewing an earlier set of facts in 1958, the distinguished economist Fritz Machlup wrote seem to ''“it would be a strong lobby arguing that while it is ok for irresponsible, on the rest basis ofus to benefit from the fruits our present knowledge of our laborsits economic consequences, inventors and creatorsshould have to subsist on the charity of othersrecommend instituting [a patent system].”²⁰'' For all the emotion, it seems both sides agree Since there is no evidence thatintellectual property laws monopoly achieves the desired purpose of increasing innovation and creation, it has no benefits. So there is no need for society to strike a balance betweenproviding sufficient incentive for creation and the freedom benefits against the costs. This leads us to makeuse of existing ideas. Put it differently, both sides agree thatour final conclusion: intellectual property rights are a “necessary evil” that fostersinnovation, and disagreement is over where the line should bedrawnan unnecessary evil. For the supporters of intellectual property, currentBoldrin & Levine: Against Intellectual Monopoly, Chapter 17monopoly profits are barely enough; for its enemies currently'''Comments'''monopoly profits are too high.Our analysis leads to conclusions that We are at variance withboth sides. Our reasoning proceeds along the following lines.Everyone wants a monopoly. No one wants grateful to compete against hisown customersGeorge Selgin and John Turner, or against imitators. Currently patents andcopyrights grant producers of certain ideas a monopoly. Certainlyfew people do something in exchange for nothing. Creators the University of newgoods are not different from producers Georgia Terry College of old ones: they want to becompensated Business, for their effort. Howeverpointing out a number of factual mistakes and imprecisions in our rendition of the James Watt story, as it is a long had appeared in earlier versions of this chapter and dangerousjump from the assertion that innovators deserve compensation fortheir efforts to the conclusion that patents in our 2003 Lawrence R. Klein Lecture, published in Boldrin and copyrightsLevine [2004]. In a recent article, that ismonopolySelgin and Turner [2006], are also take issue with our interpretation of the best or the only way facts and add a few additional ones that, in their view, contradict our vision of providing that reward.Statements such James Watt as “A patent is the way of rewarding somebodyfor coming up with a worthy commercial idea”15 abound in thebusiness, legal and economic pressprimary example of an intellectual monopolist. As we shall see there are manyother ways in which innovators are rewardedIt seems clear, even substantiallyfrom the references quoted by Selgin and Turner,and most that many students of them are better for society than the monopoly powerIndustrial Revolution share our view – more properly: we shared theirs. patents Selgin and copyright currently bestow. Since innovators may berewarded even without patents Turner’s argument and copyrightfacts do not, we should ask: is ittrue that intellectual property achieves however, address the intended purpose ofcreating incentives for innovation issues we raise about Boulton and creation that offset Watt. Take theirconsiderable harm?This book examines both discussion of the evidence and the theoryhypothetical “Watt sans patent. Ourconclusion is that creators’ property rights can be well protected inthe absence of intellectual property” Obviously Boulton and Watt fought hard for their patents, and that the latter does notincrease either obviously they claimed innovation or creationwould have been impossible without them. They are an unnecessaryevil.***This Our point is a book about economics, not about law. Or putdifferently, it is not about what another: could they have made enough money to compensate their opportunity cost without the patent? All the law evidence, including that reported by Selgin and Turner, suggests this is but rather what the lawshould becase. If you are interested in whether or not you are likely towind up in jail for sharing your files over In fact they make our case quite convincingly: quoting F.M. Scherer they assert that seventeen years before the internetsecond patent expired they, Boulton and Watt, this is notthe book for youwere already breaking even. If you are interested in whether it is a good ideafor the law to prevent you from sharing In economics, “breaking even” means that your opportunity costs have been paid, and your files over capital has received the internetrisk-adjusted,then this book expected return, and Scherer is for youa distinguished economist.HoweverWhatever profits Boulton and Watt made after that, were all extra rents due to monopoly power and, while this book is not about the laweconomically, somebackground on the law is necessary not needed to understanding the economicissuespay their opportunity costs. We are going to examine So, we all agree that, at least for the economics of what has, inrecent final 17 years, come to be called “intellectual propertythe patent was not serving a useful economic purpose,” especiallypatents and copyrighthence it was damaging because it created monopoly distortions. In fact, there are three broad types ofBoldrin & Levine: Against Intellectual Monopoly, Chapter 18intellectual property recognized in most legal systems: patents,copyrights and trademarks.Trademarks are different in nature than patents andcopyrights: they serve to identify the providers of goods, servicesor ideas. Copying – which would be a violation of copyright – isquite different from lying – which would be a violation oftrademark. We do not know of a good reason for allowing marketparticipants to steal identities or masquerade as people they arenot. Conversely, there are strong economic advantages in allowingmarket participants to voluntarily identify themselves. While wemay wonder if it is necessary to allow the Intel Corporation amonopoly over the use of the word “inside,” in general there islittle economic dispute over the merits of trademarks.Patents and copyrights, the two forms of intellectualproperty on which we focus, are a subject of debate andcontroversy. They differ from each other in the extent of coveragethey provide. Patents apply to specific implementations of ideas –although in recent years in the U.S. there has been decreasingemphasis on specificity. Patents do not last forever: in the UnitedStates, 20 years for patents covering techniques of manufacture,and 14 years for ornamentation. Patents provide relatively broadprotection: no one can legally use the same idea, even if theyindependently rediscover it, without permission from the patentholder.16Copyrights are narrower in scope, protecting only thespecific details of a particular narrative – although as with the caseof patents, the scope has been increasing in recent years. Copyrightis also much longer in duration than patent – the life of the authorplus 50 years for the many signatory countries of the BerneConvention, and – in the U.S. since the Sonny Bono CopyrightTerm Extension Act – the life of the author plus 70 years.17In the U.S. there are limitations on copyright not present inpatent law. As Stephen Manes correctly points out in his attack onLawrence Lessig, the right of fair use allows the purchaser of acopyrighted item limited rights to employ it, make partial copies ofit and resell them, regardless of the desires of the copyright holder.In addition, certain derivative works are allowed withoutpermission: parodies are allowed, for example, while sequels arenot.In the case of both patents and copyright, from the point ofview of economics, there are two ingredients in the law: the rightto buy and sell copies of ideas, and the right to control how otherpeople make use of their copies. The first right is not controversial.Boldrin & Levine: Against Intellectual Monopoly, Chapter 19In copyright law, when applied to the creator this right issometimes called the “right of first sale.” However, it extends alsoto the legitimate rights of others to sell their copies. It is the secondright, enabling the owner to control the use of intellectual propertyafter sale, that is controversial. This right produces a monopoly –enforced by the obligation of the government to act againstindividuals or organizations that use the idea in ways prohibited bythe copyright or patent holder.In addition to the well-known forms of intellectual property– patents and copyright – there are also lesser-known ways ofprotecting ideas. These include contractual agreements, such as theshrink-wrap and click-through agreements that you never readwhen you buy software. They also include the most traditionalform of protection – trade secrecy – as well as its contractual andlegal manifestations such as non-disclosure agreements. Likepatents and copyright all of these devices serve to help theoriginator of an idea maintain a monopoly over it.We do not know of any legitimate argument that producersof ideas should not be able to profit from their creations. Whileideas could be sold in the absence of a legal right, markets functionbest in the presence of clearly defined property rights. Not onlyshould the property rights of innovators be protected but also therights of those who have legitimately obtained a copy of the idea,directly or indirectly, from the original innovator. The formerencourages innovation, the latter encourages the diffusion,adoption and improvement of innovations.Why, however, should creators have the right to controlhow purchasers make use of an idea or creation? This givescreators a monopoly over the idea. We refer to this right as“intellectual monopoly,” to emphasize that it is this monopoly overall copies of an idea that is controversial, not the right to buy andsell copies. The government does not ordinarily enforcemonopolies for producers of other goods. This is because it iswidely recognized that monopoly creates many social costs.Intellectual monopoly is no different in this respect. The questionwe address is whether it also creates social benefits commensuratewith these social costs.***The U.S. Constitution allows Congress “To promote theprogress of science and useful arts, by securing for limited times toauthors and inventors the exclusive right to their respectiveBoldrin & Levine: Against Intellectual Monopoly, Chapter 110writings and discoveries.”18 Our perspective on patents andcopyright is a similar one: promoting the progress of science andthe useful arts is a crucial ingredient of economic welfare, fromsolving such profound economic problems as poverty, to suchmundane personal nuisances as boredom. From a social point ofview, and in the view of the founding fathers, the purpose ofpatents and copyrights is not to enrich the few at the expense of themany. Nobody doubts that J. K. Rowling and Bill Gates have beengreatly enriched by their intellectual property – nor is it surprisingthat they would argue in favor of it. But common sense and theU.S. Constitution say that these rights must be justified by bringingbenefits to all of us.The U.S. Constitution is explicit that what is to be given toauthors and inventors is an exclusive right – a monopoly. Implicitis the idea that giving this monopoly serves to promote theprogress of science and useful arts. The U.S. Constitution waswritten in 1787. At that time, the idea of copyright and patent wasrelatively new, the products to which they applied few, and theirterms short. In light of the experience of the subsequent 219 yearswe might ask: is it true that legal grants of monopoly serve topromote the progress of science and the useful arts?Certainly common sense suggests that it should. How is amusician to make a living if the moment she performs her music,everyone else can copy and give it away for free? Why would thelarge corporations pay the small inventor when they can simplytake his idea? It is hard to imagine life without the internet, andtoday we are all jet setters. Is not the explosion of creativity andinvention unleashed since the writing of the U.S. Constitution atestimony to the powerful benefit of intellectual property? Wouldnot the world without patent and copyright be a sad cold world,empty of new music and of marvelous new inventions?So the first question we will pose is what the world mightbe like without intellectual monopoly. Patents and copyrights havenot secured monopolies on all ideas at all times. It is natural then toexamine times and industries in which legal protection for ideashave not been available to see whether innovation and creativitywere thriving or were stifled. It is the case, for example, thatneither the internet nor the jet engine were invented in hopes ofsecuring exclusive rights. In fact, we ordinarily think of“innovative monopoly” as an oxymoron. We shall see that whenmonopoly over ideas is absent, competition is fierce – and that as aresult innovation and creativity thrive. Whatever a world withoutBoldrin & Levine: Against Intellectual Monopoly, Chapter 111patents and copyrights would be like, it would not be a worlddevoid of great new music and beneficial new drugs.You will gather by now that we are skeptical of monopoly– as are economists in general. Our second topic will be anexamination of the many social costs created by copyrights andpatents. Adam Smith – a friend and teacher of James Watt – wasone of the first economists to explain how monopolies make lessavailable at a higher price. In some cases, such as the production ofmusic, this may not be a great social evil; in other cases such as theavailability of AIDS drugs, it may be a very great evil indeed.However, as we shall see, low availability and high price is onlyone of the many costs of monopoly. The example of James Watt isa case in point: by making use of the legal system, he inhibitedcompetition and prevented his competitors from introducing usefulnew advances. We shall also see that because there are nocountervailing market forces, government-enforced monopoliessuch as intellectual monopoly are particularly problematic.While monopoly may be evil, and while innovation maythrive in the absence of traditional legal protections such as patentsand copyrights, it may be that patents and copyrights serve toincrease innovation. The presumption in the U.S. Constitution isthat they do, and that the benefits of more entertainment and moreinnovation outweigh the costs of these monopolies. Certainly themonopolies created by patents and copyright may be troublesome– but if that is the cost of having blockbuster movies, automobilesand flu vaccine, most of us are prepared to put up with it. That isthe position traditionally taken by economists, most of whomsupport patents and copyright, at least in principle. Some of themtake the view that intellectual monopoly is an unavoidable evil ifwe are to have any innovation at all; other simply argue that atleast some modest amount of intellectual monopoly is desirable toprovide adequate incentive for innovation and creation. Our thirdtopic will be an examination of the theoretical argumentssupporting intellectual monopoly, as well as counter-argumentsabout why intellectual monopoly may hurt rather than fostercreative activity.It is crucial to recognize that intellectual monopoly is adouble-edged sword. The rewards to innovative effort are certainlygreater if success is awarded a government monopoly. But theexistence of monopolies also increases the cost of creation. In oneextreme case, a movie that cost $218 to make had to pay $400,000for the music rights.19 As we will argue at length, theoreticalBoldrin & Levine: Against Intellectual Monopoly, Chapter 112arguments alone cannot tell us if intellectual monopoly increasesor decreases creative activity.In the final analysis, the only justification for intellectualproperty is that it increases – de facto and substantially –innovation and creation. What have the last 219 years taught us?Our final topic is an examination of the evidence about intellectualmonopoly and innovation. Is it a fact that intellectual monopolyleads to more creativity and innovation? Our examination of thedata shows no evidence that it does. Nor are we the firsteconomists to reach this conclusion. After reviewing an earlier setof facts in 1958, the distinguished economist Fritz Machlup wrote“it would be irresponsible, on the basis of our presentknowledge of its economic consequences, to recommendinstituting [a patent system].”20Since there is no evidence that intellectual monopolyachieves the desired purpose of increasing innovation and creation,it has no benefits. So there is no need for society to balance thebenefits against the costs. This leads us to our final conclusion:intellectual property is an unnecessary evil.Boldrin & Levine: Against Intellectual Monopoly, Chapter 113CommentsWe are grateful to George Selgin and John Turner, of theUniversity of Georgia Terry College of Business, for pointing out anumber of factual mistakes and imprecisions in our rendition of theJames Watt story, as it had appeared in earlier versions of thischapter and in our 2003 Lawrence R. Klein Lecture, published inBoldrin and Levine [2004]. In a recent article, Selgin and Turner[2006], also take issue with our interpretation of the facts and add afew additional ones that, in their view, contradict our vision ofJames Watt as a primary example of an intellectual monopolist. Itseems clear, even from the references quoted by Selgin and Turner,that many students of the Industrial Revolution share our view –more properly: we shared theirs.Selgin and Turner’s argument and facts do not, however,address the issues we raise about Boulton and Watt. Take theirdiscussion of the hypothetical “Watt sans patent.” ObviouslyBoulton and Watt fought hard for their patents, and obviously theyclaimed innovation would have been impossible without them. Ourpoint is another: could they have made enough money tocompensate their opportunity cost without the patent? All theevidence, including that reported by Selgin and Turner, suggeststhis is the case. In fact they make our case quite convincingly:quoting F.M. Scherer they assert that seventeen years before thesecond patent expired they, Boulton and Watt, were alreadybreaking even. In economics, “breaking even” means that youropportunity costs have been paid, and your capital has received therisk-adjusted, expected return, and Scherer is a distinguishedeconomist. Whatever profits Boulton and Watt made after that,were all extra rents due to monopoly power and, economically, notneeded to pay their opportunity costs. So, we all agree that, at leastfor the final 17 years, the patent was not serving a useful economicpurpose, hence it was damaging because it created monopolydistortions.Notes'''Notes'''

1 ¹ Lord [1923] p. 5-3.htm.2 ² Carnegie [1905] p. 157.3 ³ Much of the story of James Watt can be found in Carnegie[1905], Lord [1923], and Marsden [2004]. Information on the roleBoldrin & Levine: Against Intellectual Monopoly, Chapter 114 role of Boulton in Watt’s enterprise is drawn from Mantoux [1905]. Alively description of the real Watt, as well of his legal wars againstHornblower – and many other – and of how he subsequently usedhis status to alter the public memory of the facts, can be found inMarsden [2004]. That Pickard’s patent was unjust is also the viewof Selgin and Turner (2006), who, like Watt, do not seem toprovide any evidence of why it was so. As both the Lord and Carnegie works are out of copyright,both are available online at the very good Rochester site on thehistory of steam power www.history.rochester.edu/steam. Laterdrafts of this chapter benefited enormously from the arrival ofGoogle Book Search, which allowed us to check so many originalhistorical sources about James Watt and the steam engine wewould have never thought possible.4 ⁴ Lord [1923] gives figures on the number of steam enginesproduced by Boulton and Watt between 1775 and 1800, while the''The Cambridge Economic History of Europe '' [1965] provides dataon the spread of total horsepower between 1800 and 1815 and thespread of steam power more broadly. However, Kanefsky [1979]has largely discredited the Lord numbers, which is why we usefigures on machines and horsepower from Kanefsky and Robey[1980]. Our horsepower calculations are based on 510 steamengines generating about 5,000 horsepower in the U.K. in 1760.During the subsequent forty years we estimate that about 1,740engines generating about 30,000 horsepower were added. Thisgives our estimate that the total increased at a rate of roughly 750horsepower each year. For 1815 we estimate about 100,000horsepower – that is, the average of the figures Kanefsky andRobey [1980] give for 1800 and 1830. This together with the35,000 horsepower we estimate for 1800 gives our estimate thatthe total increased at a rate of roughly 4,000 horsepower each yearafter 1800. Data on the fuel efficiency, the “duty,” of steam engines isfrom Nuvolari [2004b].

5 ⁵ Kanefsky and Robey [1980] together with Smith [1977-78]provide a careful historical account of the detrimental impact of theNewcomen’s, first, and of Watt’s patents, later, on the rate ofadoption of steam technology. Apart from the books just quoted,information about the Hornblower’s engine and its relation toBoldrin & Levineto Watt’s are widely available through easily accessible web sites, such as Encyclopedia Britannica, Wikipedia, and so on. Some details of Hornblower’s invention may be of interest. It was patented in 1781 and consisted of a steam engine with two cylinders, significantly more efficient than the Boulton and Watt design. Boulton and Watt challenged his invention, claiming infringement of their patent because Hornblower engine used a separate condenser, and won. With the 1799 judicial decision against him, Hornblower had to pay Boulton and Watt a substantial amount of money for past royalties, while losing all opportunities to further develop the compound engine. His compound steam engine principle was not revived until 1804 by Arthur Woolf. It became one of the main ingredients in the efficiency explosion that followed the expiration of Boulton and Watt’s patent. Watt’s low-pressure engines were a dead end for further development; history shows that high-pressure, non-condensing engines were the way forward. Boulton and Watt’s patent, covering all kinds of steam engines prevented anyone from working seriously on the high-pressure version until 1800. This included William Murdoch, an employee of Boulton and Watt, who had developed a version of the high-pressure engine in the early 1780s. He named it the “steam carriage” and was legally barred from developing it by Boulton and Watt’s successful addition of the high-pressure engine to their patent, although Boulton and Watt never spent a cent to develop it. For the details of this story the reader should check the on line site Cotton Times at http: Against Intellectual Monopoly//www.cottontimes.co.uk/ or Carnegie [1905, pp. 140-141]. The “William Murdoch” entry in Wikipedia provides a good summary. More generally various researchers directly connect Murdoch to Trevithick, who is now considered the official “inventor” (in 1802) of the high-pressure engine. Quite plainly, the evidence suggests that Boulton and Watt’s patent retarded the high-pressure steam engine, Chapter 1and hence economic development, of about 16 years.15⁶ The story about Pickard’s patent blocking adoption by Watt is told in von Tunzelmann [1978]. ⁷ Thompson [1847] p. 110 and quoted also in Lord [1923]. ⁸ Scherer [1984] pp. 24-25.

Watt’s are widely available through easily accessible web sites,such as Encyclopedia Britannica, Wikipedia, and so on. Somedetails of Hornblower’s invention may be of interest. It waspatented in 1781 and consisted of a steam engine with twocylinders, significantly more efficient than the Boulton and Wattdesign. Boulton and Watt challenged his invention, claiminginfringement of their patent because Hornblower engine used aseparate condenser, and won. With the 1799 judicial decisionagainst him, Hornblower had to pay Boulton and Watt a substantialamount of money for past royalties, while losing all opportunitiesto further develop the compound engine. His compound steamengine principle was not revived until 1804 by Arthur Woolf. Itbecame one of the main ingredients in the efficiency explosion thatfollowed the expiration of Boulton and Watt’s patent.Watt’s low-pressure engines were a dead end for furtherdevelopment; history shows that high-pressure, non-condensingengines were the way forward. Boulton and Watt’s patent,covering all kinds of steam engines prevented anyone fromworking seriously on the high-pressure version until 1800. Thisincluded William Murdoch, an employee of Boulton and Watt,who had developed a version of the high-pressure engine in theearly 1780s. He named it the “steam carriage” and was legallybarred from developing it by Boulton and Watt’s successfuladdition of the high-pressure engine to their patent, althoughBoulton and Watt never spent a cent to develop it. For the detailsof this story the reader should check the on line site Cotton Timesat http://www.cottontimes.co.uk/ or Carnegie [1905, pp. 140-141].The “William Murdoch” entry in Wikipedia provides a goodsummary. More generally various researchers directly connectMurdoch to Trevithick, who is now considered the official“inventor” (in 1802) of the high-pressure engine. Quite plainly, theevidence suggests that Boulton and Watt’s patent retarded thehigh-pressure steam engine, and hence economic development, ofabout 16 years.6 The story about Pickard’s patent blocking adoption by Watt istold in von Tunzelmann [1978].7 Thompson [1847] p. 110 and quoted also in Lord [1923].8 Scherer [1984] pp. 24-25. Boldrin & Levine: Against Intellectual Monopoly, Chapter 116 9 ⁹ U.S. District Court for Eastern District of Virginia Plaintiff NTP,Inc. v. Defendant Research In Motion Ltd. Civil Action Number3:01CV767-JRS.10 ¹⁰ U.S. Patent 6219694.11 ¹¹ United States Court of Appeals for the 9th Circuit Court, In Re:Napster.12 ¹² Stephen Manes [2004] .13 ¹³ Lessig [2004].14 ¹⁴ Robert Barro and Xavier Sala-i-Martin [1999] p. 290.15 ¹⁵ ''The Economist'', June 23rd 2001, page 42, with italics added.16 ¹⁶ Information on U.S. Patent Law can be found at the U.S. PatentOffice at www.uspto.gov/main/patents.htm. In addition to utilityand design patents, there is also a third class of patent, the plantpatent. Like a utility patent, a plant patent lasts 20 years.17 ¹⁷ The Sony Bono Copyright Extension Act can be found online atlibrary.thinkquest.org/J001570/sonnybonolaw.html, while theBerne Convention on Copyright can be found atwww.law.cornell.edu/treaties/berne/. A useful discussion of fairuse, including parodies, is Gall [2000].18 ¹⁸ U.S. Constitution Article 1, Section 8. The U.S. Constitution, notbeing copyrighted, is online at various places, such ashttp://www.law.cornell.edu/constitution.19 ¹⁹ The $218 movie was Tarnation and the information from BBCNews, is at http://news.bbc.co.uk/2/hi/entertainment/3720455.stm.20 ²⁰ Machlup [1958], p. 80. He nevertheless concluded that weshould keep the patent system. We discuss his position further inour conclusion.[[Luokka:Käännöstyöt]]