The Cost of Price: Why and How to Get Beyond Intellectual Property Internalism


The field of intellectual property (IP) law today is focused, as the name itself advertises, on one particular institutional approach to scientific and cultural production: IP. When legal scholars explain this focus, they typically do so with reference to the virtues of price. Because price gives us a decentralized way to link social welfare to the production of information, IP is alleged to be more efficient than other approaches. The dominant mode of IP scholarship begins here and then addresses questions internal to IP law— for example, how broad or narrow should exceptions to IP rights be? But the internalism that characterizes the field of IP cannot, as I show, be justified by the value of efficiency. Economics offers us no a priori reason to assume that IP is more efficient than other possible approaches, most prominently government procurement and commons-based production. If we take the invitation that economists offer us to think external to IP, we also gain new insights about the implications of values other than efficiency for the choice between different institutional approaches to scientific and cultural production. We see, as I argue, that using price to guide scientific and cultural production—which is to say, using IP—may have costs not only for efficiency, but also for distributive justice and informational privacy. The IP approach is in tension with the value of distributive justice because reliance upon price may yield not only unjust distribution of existing information resources but also unjust production of future information resources. The IP approach is in tension with the value of information privacy because relying on price to generate information facilitates the desire, the demand, and perhaps the capacity for price discrimination. That, in turn, generates an impulse for the extensive collection of personal information. Both government procurement and commons-based production plausibly offer more promise than does IP in both distributive justice and privacy terms, and they may be no less efficient than IP. Giving full scope to all three of these values thus requires us to telescope out from the internalism that characterizes the field, and to countenance a broader role for commons-based production and government procurement. In the field of IP, I conclude, we should pay less attention to IP and more to the alternatives.

About the Author

Amy Kapczynski is Associate Professor of Law at Yale Law School.

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