Intellectual capital

“ An artificial scarcity of concepts and ideas can then be established. Much money is to be made when creative flows of knowledge and ideas become scarce products or commodities that can be traded in the market place. And, increasingly, intellectual property law is providing profiteers with vast accumulations of wealth. ”

“ So why should the big manufacturers, publishing houses, record companies, software companies and fashion houses worry? The answer lurks in history. Intellectual property is a relatively new notion. In the near past, no one considered knowledge or the fruits of creativity (art, design) as "patentable", or as someone's "property". ”

“ I have given my guesses about the future of the distributed model of innovation. My own utopia has it flourishing alongside a scaled-down, but still powerful, intellectual property regime. Equally plausible scenarios see it as a dead end or as the inevitable victor in the war of productive processes. These are all guesses, however. At the very least, there is some possibility, even hope, that we could have a world in which much more of intellectual and inventive production is free. ”

“ Economically, he believed that the creation of academic and intellectual property was a social process often paid by governments and by the public and, as had been the case with libraries in previous centuries, he demanded that they stay part of the public good. ”

“ To some people, my argument so far—and Jefferson's and Macaulay's—will seem to miss the point. They see intellectual property rights not as an incentive, a method of encouraging the production and distribution of innovation, but as a natural or moral right. My book is mine because I wrote it, not because society or the law gives me some period of exclusivity over allowing the copying of its contents. My invention is mine because it came from my brain, not because the law declares a twenty-year monopoly over its production or distribution. ”

“ Intellectual property rights – despite their noble title – are less about the intellect and more about property. This is Big Money: the markets in intellectual property outweigh the total industrial production in the world. ”

“ The Predator Economies can also be classified:
Generators of Intellectual Property - These are economies that encourage and emphasize innovation and progress. They reward innovators, entrepreneurs, non-conformism and conflict. They spew out patents, designs, brands, copyrighted material and other forms of packaged human creativity. They derive most of their income from licensing and royalties and constitute one of the engines driving globalisation. Still, these economies are too poor to support the complementary manufacturing and marketing activities. ”

“ Not content with declarations of friendship, profiteers are eager to put into practice their fondness for creativity as well. Action speaks louder than words in capitalist culture. To display their affection, profiteers use legal mechanisms, namely intellectual property law, to watch over concepts and ideas and to protect them from those who seek to misuse them. While we are dead to the world at night, they are busily stockpiling intellectual property at an astonishing rate. ”

“ The twentieth century saw damn near no such thing as the published poet, because publishers didn't make any money from poetry, and poets swept floors. That was the triumph of the intellectual property system's support for incentives for producers. ”

“ Information is hard to value until you have it, but once you have it, how can you dispossess yourself of it? The apple can be taken back by the merchant if you decide not to buy. The facts or the formulae cannot. The moment when you might have decided to pay or not to pay is already over. The great economist Kenneth Arrow formalized this insight about information economics,58 and it profoundly shapes intellectual property policy. ”

“ It would probably be very inefficient, the economists tell us. Perfect information is a defining feature of the perfect market. The more commodified and restricted our access to information, the less efficient the operation of the market, the more poorly it allocates resources in our society. (The permanent and in some sense insoluble tension between the need to provide incentives to generate information, thus raising its cost, and the need to have access to perfect information for efficiency is the central feature of our intellectual property policy.) ”

“ But let a man create books or serials in his head and Congress sees him as a social inferior, a mere wage earner.
The accumulation of intellectual property for a book may require three-quarters of a life. ”

“ But does intellectual property work this way now, promoting the ideal of progress, a transparent marketplace, easy and cheap access to information, decentralized and iconoclastic cultural production, self-correcting innovation policy? Often it does, but distressingly often it does the reverse. The rights that were supposed to be limited in time and scope to the minimum monopoly necessary to ensure production become instead a kind of perpetual corporate welfare—restraining the next generation of creators instead of encouraging them. ”

“ Focus not on the incentives alone, but on the decentralization of information processing and decision making that a market offers. Instead of having ministries of art that define the appropriate culture to be produced this year, or turning the entire path of national innovation policy over to the government, intellectual property decentralizes the choices about what creative and innovative paths to pursue while retaining the possibility that people will actually get paid for their innovation and creative expression. ”

“ If one could turn an algorithm into a patentable machine simply by adding "by means of a computer," then one could turn a business method into something patentable by specifying the organizational or information technology structure through which the business method is to be implemented. 30
If you still remember the first chapters of this book, you might wonder why we would want to patent business methods. Intellectual property rights are supposed to be handed out only when necessary to produce incentives to supply some public good, incentives that otherwise would be lacking. ”

“ Ten years ago, when I first offered the environmental analogy, I claimed that intellectual property policy was seen as a contract struck between industry groups—something technical, esoteric, and largely irrelevant to individual citizens, except in that they were purchasers of the products that flowed out of the system. ”

“ The Enclosure of Science and Technology: Two Case Studies 1 Over the last forty years, much has changed in the way that scientific research and technological development are organized, funded, and institutionally arranged. Much has also changed in the type of scientific and technical material that is covered by intellectual property rights, the ways that material is covered, the parties who hold the rights, and the state of research and development at which rights claims are made. ”

“ Lacking an ability to exclude, creators will be unable to charge for their creations; there will be inadequate incentives to create. Thus, the law must step in and create a limited monopoly called an intellectual property right. 26
How about the argument that the increasing importance of information-intensive products to the world economy means that protection must increase? Must the information commons be enclosed because it is now a more important sector of economic activity? 23 This was certainly one of the arguments for the first enclosure movement. ”

“ The author shows also that the progress of the natural and mechanical sciences will deliver man from the pressure of the more painful sorts of labor; and that wealth, freed from the barriers which now hinder its circulation, would be distributed freely throughout society. Intellectual property would be seriously guaranteed, and would enrich the men of genius, whose inventions and discoveries are now profitable, not to the authors, but to the capitalists who take advantage of them. ”

“ LEARNING FROM ENVIRONMENTALISM 23
I have argued that our policies are distorted not merely by industry capture or the power of incumbent firms, but by a series of cultural and economic biases or presuppositions: the equation of intellectual property to physical property; the assumption that whenever value is created, an intellectual property right should follow; the romantic idea of creativity that needs no raw material from which to build; the habit of considering the threats, but not the benefits, of new technologies; the notion that more rights will automatically bring more innovation ”

“ SENSE OF CONGRESS. It is the sense of Congress that--
(1) the United States intellectual property industries have created millions of high-skill, high-paying United States jobs and pay billions of dollars in annual United States tax revenues; (2) the United States intellectual property industries continue to represent a major source of creativity and innovation, business start-ups, skilled job creation, exports, economic growth, and competitiveness ”

“ No one who looks at the Web can doubt the power of distributed, and frequently uncompensated, creativity in constructing remarkable reference works, operating systems, cultural conversations, even libraries of images and music. Some of that innovation happens largely outside of the world of intellectual property. Some of it happens in privately created areas of sharing that use property rights and open, sometimes even machine-readable, licenses to create a commons on which others can build. The world of creativity and its methods is wider than we had thought. ”

“ But the system and order that so govern the work, and that come into view in its procedure and results, are the logical system and order of intellectual enterprise, not the mechanical or statistical systematization that goes into effect in the management of an industrial plant or the financiering of a business corporation. ”

“ The worst ones can still be avoided altogether, and there are powerful counterweights in both law and culture to the negative trends I describe here. There are lots of reasons for optimism. I will get to most of these later, but one bears mentioning now. Contrary to what everyone has told you, the subject of intellectual property is both accessible and interesting; what people can understand, they can change—or pressure their legislators to change. ”

“ They are matters of "the state of industrial arts," and are the outcome of the work of those men who are engaged in the industrial employments rather than of those who are occupied with business affairs. The inventors, engineers, experts, or whatever name be applied to the comprehensive class that does the intellectual work involved in the modern machine industry, must prepare the way for the man of pecuniary affairs by making possible and pitting in evidence the economies and other advantages that will follow from a prospective consolidation. ”

“ Many academics who study both science's organizational structure and the intellectual property claims that surround it are concerned about the results. To say this is not to conjure up a tragically lost world of pure research science, untainted by property claims or profit motives. That world never existed and it is probably a good thing too. Intellectual property rights, and the profit motive more generally, have a vital and beneficial role in moving innovations from lab bench to bedside, from computer simulation to actual flight. ”

“ Yet the changes brought about by the spread of instruction and the consequent struggles of an uneasy ambition, are, or at least might well be, forcing on many minds the need of some regulating principle with regard to the publication of intellectual products, which would override the rule of the market: a principle, that is, which should be derived from a fixing of the author's vocation according to those characteristics in which it differs from the other bread-winning professions. ”

“ Everyone is beginning to understand that in the world of the twenty-first century the rules of intellectual property are both vital and contentious. How good it would be then if our debate on intellectual property policy were as vigorous and as informed as the debates of the nineteenth century. ”

“ But suppose the inventor is a poor man—and a great many inventors are poor men—his chance of getting paid for his ability is very small. Because, to begin with, he has to pay a good deal to patent his invention, and then, often enough, he needs capital to work the patent, and has none.
What is he to do? He must find a capitalist to work the patent for him, or he must find a man rich enough to buy it from him. ”

“ I want to convince you that intellectual property is important, that it is something that any informed citizen needs to know a little about, in the same way that any informed citizen needs to know at least something about the environment, or civil rights, or the way the economy works. ”

“ As I have tried to show here using the words of Jefferson and Macaulay and examples such as term extension, software copyrights, and garage door openers, this logic is fallacious. Even without data, the "more is better" idea is obviously flawed. Copyrighting the alphabet will not produce more books. Patenting E=?mc2 will not yield more scientific innovation. Intellectual property creates barriers to, as well as incentives toward, innovation. ”

“ I am inclined to think that the actual status of an intellectual production and the relation of its producer to the community would be more accurately expressed by a combination of the first and fourth of these theories. We may assume in the first place that the right of the producer to the complete and unrestricted control of an intellectual production has been accepted as no less binding upon the community than the rights of the producers of material property. ”