A Practical Argument against Copyright Protection

Patri Friedman has an interesting argument against “intellectual property”:

An argument by Milton Friedman about “consensual crimes”, however, pushes me more in the anti-IP camp. Libertarians, of course, decry such “crimes” for moral reasons, but his argument manages to be both consequentalist and general. He points out that consensual crimes have a naturally higher enforcement cost and worse effect on civil liberties.

The reason is that for a normal crime, such as theft, there is someone actively trying to stop the crime, and with the interest to report it and help solve it. For a crime such as prostitution, neither the buyer nor the seller are being harmed. Hence neither will report it, and neither will help solve it. On the contrary, both have an interest in hiding it. So to catch someone at such a crime, you need to spy, to mole, to entrap – because the participants aren’t going to help.

Regardless of your moral beliefs, anyone with a practical bent understands that enforcing laws has costs, and those costs must be measured against the benefits of stopping the bad activity. This argument adds some consequentalist punch to libertarian morality by suggesting that the class of activities we think should be legal (consensual ones) will naturally be more expensive to ban than the class we think should be illegal (nonconsensual ones). In the specific case of IP, the copier/user and the copied are engaging in consensual activities – as with prostitution, it is only some distant authority who wishes this activity to stop.

There’s clearly something to this. The recording industry’s war on file sharing does have some similarities to the war on drugs. But even if we were to conclude that it was hopeless and ought to be abandoned (which I’m not willing to do), I think the implications would be less sweeping that Friedman suggests.

The fundamental problem is that individuals are difficult to deter. There are a lot of them, they can be difficult to catch, and when you do catch them, there’s not a whole lot you can do to them. Many of them don’t have very much money, and it would be (rightly) considered barbaric to throw them in prison for copyright infringement.

But things are rather different for larger institutions. There are many fewer of them, their infringement is easier to detect (since they have multiple employees, any one of which can rat them out), and they have deeper pockets, making them more deterrable. An individual might not think twice about running bootleg copies of Office, but a major corporation will.

We can see the same principle at work in other industries. File-sharing might destroy the home video market, but there will be movie theaters for the foreseeable future, and those will be much easier targets for copyright enforcement. The same principle applies to books: as long as people prefer paper books over eBooks, and as long as book publishing remains a capital-intensive business, copyright holders will be able to prevent the printing of bootleg copies of their books.

So even if the Milton Friedman argument about prohibition applies to file-sharing, that’s an argument for narrowing the scope of copyright (to focus more narrowly on commercial exploitation) rather than abandoning it entirely.

This is also an example of the point I made yesterday: Friedman’s argument doesn’t realy apply to patent law at all. People don’t trade patented works via peer-to-peer networks, and most patent lawsuits are filed against firms rather than individuals anyway. So rather than promising “A practical argument against IP protection,” it would have been more accurate to use the title “A practical argument against copyright protection.” That would have promoted clearer thinking on the subject any prevented any Catallarchy readers from mistakenly thinking that Friedman’s argument also applies to patents.

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