Wednesday, November 22, 2006

The Piracy Paradox

The "piracy paradox". Could this be the story generations tell their children regarding the dead end of intellectual monopoly, much like we tell the story of the "tragedy of the commons" now?

Here's the paper The Piracy Paradox: Innovation and Intellectual Property in Fashion Design by Kal Raustiala and Chris Sprigman. The abstract begins,

The orthodox justification for intellectual property is utilitarian. Advocates for strong IP rights argue that absent such rights copyists will free-ride on the efforts of creators and stifle innovation. This orthodox justification is logically straightforward and well reflected in the law. Yet a significant empirical anomaly exists: the global fashion industry, which produces a huge variety of creative goods without strong IP protection. Copying is rampant as the orthodox account would predict. Yet innovation and investment remain vibrant. Few commentators have considered the status of fashion design in IP law. Those who have almost uniformly criticize the current legal regime for failing to protect apparel designs. But the fashion industry itself is surprisingly quiescent about copying. Firms take steps to protect the value of trademarks, but appear to accept appropriation of designs as a fact of life. This diffidence about copying stands in striking contrast to the heated condemnation of piracy and associated legislative and litigation campaigns in other creative industries.

Why, when other major content industries have obtained increasingly powerful IP protections for their products, does fashion design remain mostly unprotected - and economically successful? The fashion industry is a puzzle for the orthodox justification for IP rights. This paper explores this puzzle. We argue that the fashion industry counter-intuitively operates within a low-IP equilibrium in which copying does not deter innovation and may actually promote it. We call this the piracy paradox.

Looks like some good Thanksgiving reading. How appropriate since the pilgrims experienced the tragedy of the commons with its concomitant famine. Perhaps some creative soul could write a play about how the Pilgrims dealt with the piracy paradox in their world of fashion, fictitiously of course.... There must be a story line there somewhere.

Hat tip: Volokh Conspiracy

No comments: