The Case against Copyright: A Comparative Institutional Analysis of Intellectual Property Regimes

Abstract

Contemporary debates over intellectual property (IP) generally evidence positions that appear to line up at opposite ends of the same axis, with one side arguing for rights for IP owners under each major regime - patent, trademark, and copyright - and the other side arguing for fewer. Approaching from what some may see as a more IP view, this paper offers the counterintuitive suggestion to consider abolishing one of these IP regimes - copyright, at least with respect to the entertainment industry, which represents one of that regime's most commercially significant users. This realization is in fact consistent with the underlying view because the view is not accurately seen as even being directed to the more or less debate; and instead is focused on means as much as ends. In keeping with this means-directed approach, the paper provides the first comprehensive analysis of IP regimes using the set of tools from the field of new institutional economics. In so doing the paper offers the first normative case for IP that connects the path breaking literature on the theory of property rights generally with the seminal theories of the firm, transaction costs, and agency costs. Underlying this paper's stark departure from both the more and less bodies of the IP literature is the realization that the institutional structure of the present copyright regime may make the social costs of the present copyright regime too high, for at least the entertainment industry, while at the same time preventing it from providing the coordination benefits an IP regime normatively should provide. Building on this, the paper begins to explore for the first time whether the recent patent and trademark regimes have institutional structures that may allow them to provide these coordination benefits better, and with lower social costs. The paper thereby suggests how the patent and trademark regimes of yesterday may obsolete the copyright system of today.