Intellectual property

I am sure that most of us are aware of laws regarding patents and copyrights. These are primarily aimed at preserving the rights of an individual or an organisation over something valuable, like a piece of art, writing or music.

These laws are based on the concept of intellectual property. Over time, the rules framed under intellectual property have been used to protect and propel scientific and technological innovation. The reason is that these innovations usually bring with them an expectation of profits, which could be negated in case the innovation is copied by others.

Hence, we have all kinds of protection laws against copying the intellectual achievements of others. Of late, though, many have questioned their necessity as they have assumed the character of a double-edged sword.

In order to have a reasonable understanding of these laws, it is important to understand the concept of intellectual property and its genesis. In its meaning and implications, this term is not as straightforward as the simple use of the word ‘property’ which is generally meant in terms of some material possession (like land).

It first appeared in the Oxford English Dictionary in 1769, when an anonymous reviewer reviewed a book titled ‘New and General System of Physic’. In the review, the reviewer accused the author of the book of extensive copying from other material and claiming to have carried out many ‘wonderful’ experiments by himself. The reviewer remarked: “What a niggard this Doctor is of his own, and how profuse he is of other people’s intellectual property!”

Since then, the term slowly began to take hold in English writings. It gradually became an accepted part of social discourse and legal framework. It then spread to mainland Europe and across the Atlantic to the US. The first ever case involving the issue of intellectual property in the US dates back to October 1845. In its decision, the court upheld the principle of intellectual property on the basis that it would sustain inventors who are an integral part of a society based on sound principles. The decision also stated that the labours of one’s mind are as much a fruit of honesty as the ‘wheat he cultivates or the flocks he rears’.

The legal systems around the world, especially in countries where technological prowess is well established, have recognised this right of individuals and steadfastly upheld it over time. And their decisions have been complemented by society’s ready acceptance of this right of citizens.

Here, one needs to make a distinction between the two concepts of physical property and intellectual property. Though they may seem identical, they are different by nature. If physical property is stolen (say money), we then have none of it. But even if intellectual property is stolen, an individual can still use it to gain wealth. For example, a machine may be copied by another individual, but the original machine still remains with the innovator, which he can use to his advantage.

Given these kinds of considerations, there have been many emerging voices in recent times which have termed intellectual property a ‘propaganda term’, one that is employed frequently to protect the interests of established firms. They contend that this supposed negative use of intellectual property is proving to be a hindrance to innovation rather than encouraging new work; this really kills the purpose of introducing intellectual property in the first place.

In 2005, Mark Lemley, a lawyer, wrote that for the majority of individuals, intellectual property means the same thing as other forms of property. This oversimplification easily leads to confusion regarding private and public rights as applicable to the concept of intellectual property. He in fact goes on to suggest that it is a form of subsidy to encourage innovation, but in the end consumers end up paying a heavy price for it (the products of the firm with a patent are usually sold at higher prices given that there is little competition).

The latest to voice their dissatisfaction over this issue are two economists, Michael Boldrin and David Levine, in the form of their research paper ‘The Case against Patents’. In their article, they discuss what they call the ‘patent puzzle’, stating that their research did not indicate any marked increase in the rate of technological progress or R&D expenditures despite the ever increasing strength of legal protection afforded to patents. They go on to claim that this has many negative consequences, one of them being suppressing competition from innovating rivals (established individuals or firms take the legal route to stave off competition, citing the granted patent).

Among the proponents and critics of the concept of intellectual property, there is widespread agreement that protecting it does have its merits. It’s a precursor and strong incentive for individuals to innovate and realise a material return, and to capture a part of social benefits that accrue to the system as a whole in the form of economic growth.

However, critics believe that this concept has been taken too far in its implications, and has reached a point where its negatives outweigh its positives. Specifically, established firms are using it to maintain their monopoly and thus slow down the process of competition through new innovation.

If we take the provision of patents to be a form of subsidy by the government, legal system and the society, then this kind of negative behaviour negates the very basis of providing this subsidy. After all, society is providing this subsidy in order to enhance innovation, not to hinder it. Thus, in evaluating any future policy regarding patents and intellectual property, policymakers and society must address relevant questions like the length of a patent, nature of legal enforcement, nature of ownership, public and private outcomes, government’s role in promoting R&D, the implications for industry in the long and short run, etc.

To properly implement the concept of intellectual property and address its misgivings, it is imperative that these questions be debated.

The writer is a freelance contributor.

Email: shahid.mohmand@gmail.com

Twitter: @ShahidMohmand79