Selgin-Turner Vs. Boldrin-Levine

by Don Boudreaux on January 7, 2010

in History, Innovation, Law, Myths and Fallacies, Property Rights

Economic history is fascinating, not least because reality is so creative and revealing.

In this excellent paper, George Selgin and John Turner challenge the now-popular notion that patent protection hampered the development of steam power in the 19th century.

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  • elizadavid
    I agree. Excellent, thoughtful post. I'm curious about the first mover advantage claim. Are they any academic results which account for legal IP protections that show clear first mover advantages in specific industries or across industries? It's always sounded more like a business book idea than reality. Think iPods... They weren't the first digital music players on the block. In a recent EconTalk podcast, Chris Anderson talks about how free can twist around first mover advantage.

    buy r4i
  • NathanS
    I think by excellent, you meant somewhat boring and superfluous to the argument against IP.
  • Of course, even if Selgin is right, this does not damage the anti-IP case.
  • martinbrock
    I haven't read the paper, but neither the title nor the abstract suggests a defense of IP. Showing that a particular empirical study exaggerates the case against IP is no argument in favor of IP. It's only an argument against a particular empirical study. I take for granted that a global monopoly over a category of products is a bad idea. If it's not, show me.
  • George Selgin
    Why not? If that case rests at all on empirical evidence (and surely it ought to), and the Watt story is considered an important component of that evidence (as it is evidently understood to be by Boldrin and Levine), then surely a critical response to Boldrin and Levine's telling of the story does matter, if only a little.

    In other words, the historical record matters! Contrary to what some self-styled Misesians say, you can't settle these questions a-priori. To their credit, Boldrin and Levine themselves appreciate this (obvious) truth.
  • NathanS
    Isn't the natural state of things one in which there are no patents? Shouldn't it be the job of IP advocates to prove that giving people monopolies for arbitrary amounts of time over things that can be hardly called inventions is a welfare maximizing prospect and has nothing to do with connected interest eliminating competition?
  • Dr. Selgin, just because you can find a case where patents do not harm, does not mean they do not do overall harm in other ways.

    Second, there are indeed moral or property rights reasons to oppose IP, as I have argued extensively (see The Case Against IP: A Concise Guide), whether or not you regard this as "apriori." Not everything is empirical.
  • George Selgin
    Stephen, I never claimed that "everything" is empirical! I claim that empirical evidence like that supplied by Boldrin and Levine constitutes _part_ of the "anti-IP case."

    Suppose I concocted a version of Watt's story that succeeded in convincing everyone that had it not been for Watt's patent we'd still be stuck with circa 1750 living standards. Suppose I convinced everyone. Then suppose that Steve Kinsella uncovered crucial errors in my account. Would Kinsella's revisions not "damage the pro-IP case"? What's sauce for the goose... .
  • George, You said "I never claimed that "everything" is empirical! I claim that empirical evidence like that supplied by Boldrin and Levine constitutes _part_ of the "anti-IP case.""

    Sure. That is one way to show IP is a bad idea. But you are right, it's not the only way.

    I took you to be saying something contrary to this when above you wrote "If [the anti-IP] case rests at all on empirical evidence (and surely it ought to)" -- implying that the case "surely ... ought to" rest on empirical evidence; and when you wrote, "Contrary to what some self-styled Misesians say, you can't settle these questions a-priori. To their credit, Boldrin and Levine themselves appreciate this (obvious) truth." I thought by this you meant that the case against (or for) IP is an empirical one. In your subsequent comment you clarify that this is only part of the case against IP, implying that you agree there are some principled, property-based or normative reasons to oppose IP, though presumably they are not "apriori", but something else.

    No normative case can be made for or against a given policy on purely empirical grounds, of course. There are always some presupposed norms informing the relevance given to the data found.
  • George, it's Stephan, not Stephen, N.B. (sounds like Stefan, or Stephanie w/o the "ie")

    I have no problem with poking holes in such an empirical case, if holes there be (I don't know, I haven't examined this yet in detail--in part b/c my own case against IP is not empirical but it based on the libertarian principles of property rights). I just think that there are so many thousands of examples we anti-IP people have to choose from, that if you just remove one of them; it's really irrelevant. It doesn't prove patents were beneficial in Watt's case; only that there is no good proof here that they were notably disastrous.
  • mikeikon
    IP, when taken to its logical conclusion, leads to an absurd state in which every human action is in violation of the 'property' of another.

    I don't think you would argue that such an environment would be efficient, if it could even be managed. Perhaps some moderate position between the two extremes is ideal, but where do you draw the line?
  • David Shaw
    I have a question for anyone who'd care to comment. I have recently tried to engage a few prominent patent law professors in a discussion about the morality of intellectual property, and they refuse to even discuss it, they believe it to be a largely irrelevant discussion, so I ask the patrons here, as a large and thoughtful libertarian audience is hard to come by, what say ye about the morality of a set of laws which restricts the peaceful use of rightfully earned property by free individuals?

    Do you follow Rand- That intellectual property should be as inviolable as real property, that humans have as much right to the product of their minds as to their bodies?

    Or do you follow (well, I'm not really sure who's the most prominent thinker against IP)- That ideas are not property, that they do not require exclusive possession, and that to protect ideas as property is to restrict humans in their use of their minds and bodies?

    I won't bias with my views.
  • Marcus
    I've been a professional software engineer for 25 years and I've seen this industry go from not using patents to the extensive use of software patents we have today. In my opinion the effect has not been positive.

    First of all, if patents served their supposed purpose then I would imagine that the patent office would be the first place programmers turn to for new ideas and ideas to extend. We don't. In fact, we're discouraged from it.

    But it wouldn't matter if we weren't. They're not written by programmers for programmers and as such, they're not useful to programmers. Rather, they're written by lawyers for lawyers. That fact by itself shows which industry's interest software patents actually serve.

    I'm not claiming some evil conspiracy but I will say that the result of software patents has been as a route for lawyers to take over the industry. Before software patents lawyers were virtually unneeded in this industry. Today you can't develop anything without them.

    The next question would be, under which regime has the software industry been more innovative. That's harder to tell. I will just say that it was very innovative prior to software patents and I don't think there was a problem. It simply wasn't true that nobody would develop anything without them because we did.

    Copyright, IMHO, has always been sufficient protection for software.
  • martinbrock
    The morality of it all doesn't interest me much, except in utilitarian terms, but I'm definitely not in Rand's camp. The utility of intellectual property is an empirical question, and the burden of proof rests with proponents, not opponents, in my way of thinking. Global, forcible monopolies are suspect from the word go.

    Having politicians, lawyers and judges decide who gets to produce what hardly seems an efficient system of economic organization. You call tell me all day that the patent office is just, right, proper and noble, only valiantly protecting the heroically inventive individual toiling away in his garage. I'm not buying it. That's what all officers of the state say.

    The very idea that some architect with delusions of grandeur ought to be entitled to blow up a building that many other factors of production built along with him, just because he has a hair up his ass about some moronic manager's authority, is simple lunacy. That's not morality. It's megalomania.
  • Mommsen1625
    Thurston's classic account (1878) of the development of steam power: http://www.history.rochester.edu/steam/thurston...
  • From the abstract I see that they're challenging it but not necessarily refuting it completely? The paper costs money (which is outside my budget) so I can't really tell how strong their challenge is.
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