A logical analysis of copyright orthodoxy

NOTE HXA7241 2011-11-27T11:47Z

There is a kind of rhetorical trick in copyright theory. The orthodox model appears to give a rational solidity to copyright, but as an argument for it it is unsound, and proves nothing of what it appears to want to.

The standard copyright model produces a halo of persuasiveness in three stages:

  1. Economists tacitly pluck an assumption out of their hats: that there will be under-supply of informational goods without copyright. There is little to no actual evidence of this.
  2. They then set out the clear logical structure of copyright – the trade-off of incentive and access, and the implied optimal point that maximises efficiency.
  3. Now they can declare the incontrovertible deduction: without copyright, the price of these goods would be driven too low and producers would not be able to afford to make them – i.e: under-supply of informational goods without copyright.

It appears to have proven the very thing it assumed! – any uncertainty that might arise about the assumption seems entirely taken care of. Yet really it is just a kind of tautology.

If it is taken as merely a model, it is reasonable: it is logical, consistent, valid. But if it is taken as an argument for having copyright at all, it is unsound, because its basic assumption is false, or unproven. The model can be logical, comprehensive, lucid, clever, anything, in its own little world, but actually says nothing about the real world. (A common ailment in Economics?)

The trouble is the background rhetorical persuasive effect. The reader is carried away by the solidity, and forgets it is floating on air. (Perhaps another characteristic ailment in Economics?)


Referring to the key exposition of the orthodox view:

"While the cost of creating a work subject to copyright protection – for example, a book, movie, song, ballet, lithograph, map, business directory, or computer software program – is often high, the cost of reproducing the work, whether by the creator or by those to whom he has made it available, is often low. And once copies are available to others, it is often inexpensive for these users to make additional copies. If the copies made by the creator of the work are priced at or close to marginal cost, others may be discouraged from making copies, but the creator's total revenues may not be sufficient to cover the cost of creating the work."

"In its [copyright's] absence anyone can buy a copy of the book when it first appears and make and sell copies of it. The market price of the book will eventually be bid down to the marginal cost of copying, with the unfortunate result that the book probably will not be produced in the first place, because the author and publisher will not be able to recover their costs of creating the work."

– ‘An Economic Analysis of Copyright Law’; Landes, Posner; 1989.

The structure is: if we assume creators will earn by selling copies, they need some level of monopoly on those copies. But the question must be, why should we accept that original assumption? And furthermore, the assumption is never made clear.

"This description of the market for copies and the number of works created assumes the existence of copyright protection. In its absence anyone can buy a copy of the book when it first appears and make and sell copies of it."

– ‘An Economic Analysis of Copyright Law’; Landes, Posner; 1989.

This might appear to declare its assumption, but actually does not. What is described as the case without the assumption is really just the limit-case of the assumption. No copyright is just taken to be copyright of zero duration. But really, the non-assumption alternative is not selling copies with zero-copyright, it is not selling copies – and selling production in a different way.


So we are left with the apparent argument for copyright essentially saying: we need copyright restrictions to allow producers to earn through selling copies, because otherwise how could producers earn by selling copies. It says: we must do A because otherwise we could not do A.

This is hollow. It simply begs the question. Yet the detailed presentation of it leaves some feeling of certainty.


(Creditably, Landes and Posner themselves well know and acknowledge the unsoundness, as noted in the conclusion of ‘The economic structure of intellectual property law’.)