Response to Baker on “Intellectual Property,” Copyright, and Production

Alexander Baker blogs at Intellectual Space. He’s penned a response to a Facebook comment (included in his post) of mine in which I criticized his conception of so-called “intellectual property.” My response below will be of interest to libertarians who are grappling with the nature of scarcity and goods, especially as they relate to ideas.

“Intellectual property” is a misnomer. There is no such thing as property in ideas per se. Let’s examine why.

Human beings have unlimited wants (ends) and occupy a world of scarce resources (means) with which to achieve their wants (ends). So much information is embedded in this sentence.

Scarcity describes the limited condition of resources. That is, a ‘scarce’ resource is a depletable resource. When the consumption of one unit of a resource to satisfy an end depletes the available stock of that resource, we may describe the resource as ‘scarce.’

A scarce resource is known as a ‘good.’

We may distinguish scarce resources (goods) from superabundant resources (non-goods). The former is the subject of economic analysis and the latter is not.

A great example of a superabundant resource is ‘breathing air on the surface of the earth.’ To the perception of human beings, ‘breathing air on the surface of the earth’ is non-depletable; that is, units of the resource may be consumed without any corresponding reduction in the available stock of the resource. Under other circumstances–say, 50 feet beneath the surface of water–breathing air becomes a scarce resource in that the consumption of one unit of the resource would materially reduce the remaining available stock.

Ideas are superabundant resources (non-goods). It is literally nonsensical to conceive of “consuming an idea,” such that this consumption activity reduces the remaining stock of the idea. It is immediately clear upon reflection that one individual’s possession of an idea (say, thinking of the idea in question) does not in any way reduce the available stock of the idea. Two individuals engaged in the act of thinking about the same idea does not doubly deplete the remaining stock of the idea.

In fact, it is entirely possible for vast amounts of individuals to simultaneously ponder the same idea, and yet have no effect whatsoever on the remaining stock of the idea.

Ideas are not scarce. Ideas are not goods. Ideas are superabundant. There is no such thing as a depletable stock of ideas.

The term ‘property’ describes a good, wherein control is vested in a particular individual. In laymen’s terms, property is an owned good.

It should be clear that resources may only be deemed “property” if the resource in question is scarce. That is, property is only property in the meaningful sense, if the resource in question is not superabundant.

For example, it would be ridiculous to claim property in ‘breathing air on the surface of the earth.’ ‘Breathing air on the surface of the earth’ is superabundant. It’s stock is not depletable by marginal consumption. It is not scarce. To speak of control over a resource that isn’t scarce in the first place is ridiculous.

Thus, insofar as “intellectual property” is meant to mean property in ideas, it has no relevant meaning. There can be no property in ideas, because ideas cannot be owned. Ideas cannot be owned, because ideas are not scarce. Ideas are not scarce, because there is no depletable stock of ideas to be reduced through acts of idea-consumption.

Since ideas are not scarce, they are not goods. Since ideas are not goods, they cannot be owned.

There is no such thing as “intellectual property.” Likewise, there is no such thing as an “intangible good” in the economic sense.

Intellectual property has nothing to do with the subject of “copyright.” A copyright is literally the right to copy. In a contract to sell a good the seller may attach conditions of sale. The buyer may choose to accept these conditions of sale, in order to acquire the prescribed rights to consumption of the good. If the buyer refuses, the sale is terminated. Copyright is a condition of sale. A seller relates to the buyer that the good in question (a book, an MP3 file, etc.) may be purchased and consumed (the book read, the MP3 listened to, etc.) on the condition that the buyer pledge not to copy (scan the book, burn the MP3 to disc, etc.) the good. In this way, the seller literally retains copyright (the right to copy). In other words, the seller retains the right to copy even though the seller has exchanged other rights to the good for payment.

Conditions of sale–copyright being a type thereof–is nothing new. Homes are sold with conditions of sale all the time. A homebuyer will agree not to paint his/her new house florescent pink, park on the grass, or burn down the backyard prior to agreeing to the transaction. Why those who discuss non-existent “intellectual property” and copyright blank out on this common feature of contracts is baffling.

Baker is confused on the concept of production. In one paragraph, he states that producers “[create] nothing” in the literal sense. A “newly-produced good is just a rearrangement of pre-existing matter.” Yet in just a few lines down, he states that in the act of production the “producer has rightly acquired title to something previously unowned.”

Well which is it? Is production the arrangement of previously existing matter or not? If it is, then it must be that the previously existing matter was owned by the producer, or more precisely, that the producer owned the right to arrange the matter in a particular way so as to create some product. How could it be then that product of this arrangement is “unowned” immediately upon completion of the production process?! Clearly the owner of the newly arranged matter is the same owner of the pre-existing matter that was to be arranged by the producer! Or, if the producer has himself purchased the supplies necessary for production, then it is obvious that s/he would be the owner of the new product.

This is why the term homesteading is not synonymous with production. Production is the arrangement of matter in the form of a good that may or may not successfully serve as a means to an end for the consumer of the good. Homesteading is the acquisition of previously unowned goods. Production involves the arrangement of owned goods. Homesteading does not. The distinction is vital.

Hopefully this review of the nature of goods qua scarce resources is helpful to the reader’s understanding of the internally contradictory, so-called “intellectual property,” the proper role of the right to copy (copyright), and the distinction between production and homesteading.