The fate of WIPO, ACTA, and other intellectual property pushes in the international economy

Intellectual property wars are fiercer than ever, although the
institutions most affected (including the media) prefer not to talk
about them. But we may be in for a pendulum shift.

I recently put out a tweet on this topic and was asked to expand on
it. The issues are too big and complex for me to give them a proper
treatment here, but I’ll throw around a few of them and see whether
you think the trend I’m talking about shakes out.

Intellectual property has had an international component for a long
time (the Berne convention on copyright being the best known). A lot
of the international work has been centralized in the World Intellectual Property Organization, a branch of the United Nations. But certain issues
are the responsibility of other organizations, such as ICANN’s rulings
on domain names and trademarks. All these organizations are
stringently insulated from the public (see for instance
my most recent post on ICANN
).

One issue that’s currently the buzz of the Internet NGOs is an
Anti-Counterfeiting Trade Agreement that would expand the powers of
copyright holders, as well as courts and government agencies
representing them. You won’t find a web page about ACTA at WIPO, or at
the US Copyright Office, or
at other institutions hammering out the deal, but a casual web search
will turn up enough of a diversity of commentary to assure you it’s
really happening.

Up to now, economic trends in IP were pretty straightforward.
Countries with a long history of development tended to export the
products of IP, such as machine designs and cultural works, to
developing nations. The developed nations always wanted strong control
over IP to ensure a flow of revenue from the less developed nations,
who in turn would resist.

You could see this dynamic in the nineteenth century when novels by
Dickens were widely reprinted in the US without royalty payments, and
when the founder of the Industrial Revolution copied English looms in
order to start textile factories in Lowell, Massachusetts. Now we have
battles over the licensing of Monsanto seeds, concerns over exports of
machinery to China, and generic anti-AIDS medications being developed
in India.

And that’s why the juggarnaut of IP may be slowing. The idea behind
this blog was suggested in passing by economist Adam S. Posen in an
article titled “Who Will Sustain Globalization” for the November 2009
issue of Current History.

As I understand the argument, the institutions responsible for passing
new rules respond to the most powerful countries. The US and Europe
are on the decline in these organizations. All the countries that
benefit from looser IP regimes–China, India, Brazil–are growing in
economic strength and are finding themselves in more and more seats at
the tables of the world’s closed economic institutions. For just one
concrete example, look at the shift of responsibility in recent years
from the G-7 to the G-20. The G-7 is a familiar set of countries that
were powerful from the 1950s through the 1970s. The G-20 is truly
diverse, bringing in strong economies from around the world (but still
just the ones with some international economic clout).

Of course, what’s good for large companies that can spread their works
internationally and enforce their IP is bad for innovators elsewhere.
I am totally in favor of rewarding inventors, including large
established firms, for the time, effort, and expertise they have put
into their inventions. But as always, in IP, rewards for past work
must be balanced against the promotion of further development. And
right now, the world is moving more and more to crowdsourcing. The
best ideas will increasingly come from people around the world pooling
their ideas–including people with few resources and no connections to
major institutions. Those institutions had better learn this lesson
before they succeed in choking off inventions that make a
life-or-death difference to people in developing countries.

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  • Karl Fogel

    Unfortunately, one of the markers of “development” in the “developing countries” (even by their own assumptions) is adoption of U.S.-style copyright restrictions. It’s almost a psychological thing: to feel like your country has finally arrived, you need an air force, a certain number of missiles, a certain level of industrialization, and… a particular species of commercial monopoly on cultural works, which is often phrased as “respect for IP”, although trademarks are really unrelated to copyrights and patents (the latter two at least are conceptually similar).

    The way the treaty organizations (e.g., WIPO) lump copyrights and trademarks together is itself a reflection of how they’re inherently client-services organizations, rather than coherent responses to problems in international law. What does identity confusion (trademarks) have to do with unauthorized sharing of information (copyrights)? Nothing at all, and yet we find new copyright restrictions being tacked onto an *anti-counterfeiting* measure.

  • Andy Oram

    I like your perspective, Karl (as always). I hope that Brazil and India, if not other developing countries, will keep an eye out for the needs of the poor. Remember the support for Creative Commons by musician Gilberto Gil as Brazilian minister of culture, and the hard fight put up by India and Brazil to manufacture and distribute generic AIDS drugs.

    A lot depends on who runs the government, of course. Lulu’s government in Brazil comes out of a traditional leftist tradition (somewhat tarnished since he came to power). It’s a bit surprising that Vajpayee–labeled a conservative–would be at the helm when India started manufacturing its AIDS drugs, but there was nothing to stop companies from doing it, so I suppose that’s grand old free market capitalism at work.

    Your main point hits home: just as poor people oppose taxes on rich people because they hope to be rich someday, perhaps conservative governments in developing nations will want to reserve their own companies’ places at the trough.

  • Majjers

    If only the erosion of IP were simply about the spread of ideas. But it’s not. It can be a life and death matter. For example, whatever you may think of pharma companies, the infringement by developing countries of medicines is more than just developing countries flexing their muscles. And that’s not just about Viagra/Cialis knock-offs in your hotmail spam. The children in Brazil who died as a result of substandard copycat medicines from China spells out exactly the problems of those calling for the demise of IP laws as we know them.

    IP laws are not just there to protect businesses. They protect consumers too!

  • Beed

    There is no way the intellectual property laws are meant to protect consumers. Consumers can be protected by the respective bureau of standards and measurements or agencies akin to a food and drug administration that are supposed to check all products to ensure that they are safe. Under copyright law there needs to be a conscientous decision by goverments to be able to suspend copyright when international demand may not be able to met adequately by producers ensuring that, again, standards are not set aside in the manufacturing process. The law is meant to protect the population, not businesses alone. It is time that businesses become ‘lean’ and productive by retaining those in a workforce that do actually produce! Have you ever seen someone working in a kitchen who does not cook? No one should be bailed out because they have significant IP. The should be reformed to get rid of the bloated middle management that delays innovation and productivity – or else they deserve to have the idea taken from them. The world is full of people who have great ideas but fail to act on them. Reward naturally comes to those who not only think of helping others, but actually proceed to do so. Once that mentality is maintained money and other resources will follow.

  • Andy Oram

    In regard to the preceding exchange about protecting the public, amusing to read in the Washington Post about how trade secrects (a branch of IP law) “protect” the public:

    http://www.washingtonpost.com/wp-dyn/content/article/2010/01/03/AR2010010302110.html
    Use of potentially harmful chemicals kept secret under law

    On the broader issue of rewarding innovation, I’m not ready to totally strip away all copyrights and patents. Particularly not on O’Reilly books. Yes, there are other ways to keep building on one’s work, and innovators shouldn’t rest on their laurels. But we take a big risk even in the current environment to create and release things people want, so we need some space to get back some income.

  • http://forexinformation.webs.com Gerry Ribald

    Until China, Russia and the far east start playing ball, IP is a joke. Go to Thailand and you will see what I mean. American movies, software, everything, for pennies. Why we do not impose harsh penalties on countries that allow this, I will never know…